By Cynthia Littleton

ESPN and other Disney channels have stopped broadcasting on DirecTV after the parties failed to reach a new agreement over broadcasting rights. The business impasse reflects the broader economic pain that is spreading through the pay-TV industry.

The blackout, which comes on a key weekend for college football and ESPN's coverage of the US Open tennis tournament, affects most of DirecTV's 11 million+ subscribers in the US. DirecTV said Disney made the decision to pull the plug while negotiations were ongoing. Disney executives argued they had no choice since DirecTV refused to pay what it described as market prices for its channels.

"While we are open to offering DirecTV the flexibility and terms we have extended to other distributors, we will not enter into a deal that undervalues our portfolio of television channels and programming. We invest significantly to deliver the No. 1 brands in entertainment, news and sports because that is what our viewers expect and deserve. We urge DirecTV to do what is in the best interest of its customers and reach a deal that would immediately restore our programming," Disney said in a statement attributed to Disney Entertainment co-chairmen Dana Walden and Alan Bergman and ESPN Chairman Jimmy Pitaro.