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AT&T Drops ESPN 3D, Citing High Carriage Fee

After carrying ESPN 3D during its
rookie year, AT&T dropped the network from its U-Verse
TV platform after its carriage agreement expired on July
31, saying that the price tag was simply too high.

“We’re always listening to customers and working to
make sure we’re delivering the channels
they want, while keeping costs down,”
AT&T said in a statement. “The price
tag for ESPN 3D was too high, especially
considering the low demand we’ve
seen from customers. We’ve decided not to renew our
agreement for ESPN 3D.”

Asked to comment, ESPN said, “Unfortunately, we
could not reach agreement on a renewal at this time”
with AT&T. The sports programmer said ESPN 3D has
featured more than 120 events in its first year, and is
available to more than 60 million households through
Comcast, DirecTV, Time Warner Cable, Bright House
Networks and Verizon Commuications’ FiOS TV.

AT&T charged an additional $10 per month for the Uverse
3D Technology package of ESPN 3D and a small number
of 3D movies on-demand. The telco said the $10 charge
will be automatically removed from customers’ bills.

“We continue to add new channels and content that
our customers want,” AT&T said. “We offer several 3D titles
today in our U-verse Movies library, and we’ll look
to deliver more 3D channels and content,
at a reasonable cost, as more of our customers
purchase 3DTVs and tell us they
want it.”

Last month, AT&T added Starz’s 3D
video-on-demand package, which currently offers four
movies to subscribers of the premium network for no
additional charge.

After initially high expectations, 3DTV sales in 2010
were a big disappointment for consumer-electronics
manufacturers. In July, the Consumer Electronics Association
issued a more bullish 2011 forecast for 3D displays,
projecting 3.6 million 3DTVs will ship in the U.S.,
up from January’s forecast of 1.9 million units.