“Must-have” ESPN is not as must-have as the pay television business once believed as the costly basic cable network reported more subscriber losses as consumers cut the cord.

Despite a claim from ESPN owner Walt Disney that the sports network is watched in 83 percent of U.S. cable households, the number of cable customers buying a television package that includes ESPN is in decline. Subscriber disinterest and the growing unaffordability of cable television are the two primary reasons even the “untouchable” cable networks are starting to see the effect of cord cutting.

ESPN is the most expensive basic cable channel, costing every pay television customer at least $6.61 a month in 2015 according to SNL Kagan estimates. That price increases by about 8% a year, needed to keep up with ever-increasing sports rights fees networks pay to televise events. With subscribers covering the bill, ESPN has been able to outbid traditional network television and other cable networks to win the rights to more prestigious events. But since broadcast networks now collect money from cable subscribers as well, bidding wars have erupted that have made sports teams and league organizations very rich, thanks to cable customers that pay for ESPN and other networks whether they watch them or not.

ESPN sports programming costs

But those days may soon be over, as customers discover cheaper “skinny bundles” of cable television packages or sign up for online video services that avoid costly sports networks. That was not possible just a few years ago. ESPN’s contract mandates its network be available on the standard basic tier — no optional sports tiers allowed, if a cable system wishes to carry it. To collect even more from cable subscribers, ESPN also effectively forces cable systems to carry one or more of their ancillary networks, which include ESPN2, ESPN3, ESPN+, ESPN Latin America, ESPNews, ESPNU, ESPN Classic, ESPN Deportes, Longhorn Network, and the SEC Network. That puts even more money in ESPN’s pocket.

The network has been a safe bet for investors for years, at least until this week when the company lowered its expectations for cable operating income growth from 2013-2016. Instead of growth between 7-9 percent, ESPN is now predicting only 4-6 percent. Although some might see that as a modest adjustment, Wall Street didn’t think so and Disney shares tanked 8.4% Wednesday. That was nothing compared to what happened today.

“Media stocks are getting slaughtered,” Aaron Clark, a portfolio manager at GW&K Investment Management, which manages $25 billion in assets, told the Wall Street Journal. “It’s been the long-running fear that we would eventually see cord-cutting. Everyone thought it would be a slow-moving train wreck, but Disney’s comment woke people up.”

Viacom, Inc. dropped 12 percent after it reported declines in second-quarter profits and revenue, which investors blamed on cord-cutting. Disney fell another 2.5% today and 21st Century Fox lost 6% after lowering its expectations for full-year profit for fiscal 2016. Cord-cutting, again.

To say ESPN is important to Disney would be an understatement. At least 75% of Disney’s cable network revenue comes from ESPN and estimates suggest 25% of Disney’s entire operating income in 2015 comes from the sports cable network. As ESPN faces customer defections and pressure on revenue growth, their costs are still rising. Sports rights at ESPN rose by 13% in 2014 and 19% in 2015, according to MoffettNathanson. If ESPN continues to lose customers and is forced to become more conservative about future price increases, parent company Walt Disney will feel the heat.

AT&T will soon have the highest activation fees in the wireless industry after an August price increase takes effect, boosting activation and upgrade charges for existing customers and adding a new $15 fee to activate a phone you already own and want to use on AT&T’s network.

AT&T confirmed that effective Aug. 1, the activation fee for new one or two-year contract plans will increase by $5 to $45.

The company also plans to add a $15 activation fee for new AT&T Next customers wishing to activate a “bring your own device” (BYOD) and sign up for a new line. For now, Next customers already committed to an installment plan before Aug. 1, 2015 will have the $15 activation fee waived for their next upgrade, but will pay the fee after that. AT&T warns it may drop that waiver at any time.

An AT&T spokesperson would only say, “We are making a few adjustments to our activation and upgrade fee structures,” in an e-mailed statement.

AT&T raised its activation fees from $35 to $40 last year and Verizon Wireless followed in January. It is very likely, based on earlier rate changes, Verizon will eventually match AT&T’s fee increases.

Two cable industry trade associations have asked the Federal Communications Commission to start collecting more fees from satellite television operators to cover the FCC’s regulatory expenses — a move satellite providers argue will cause consumers to suffer bill shock from increased prices.

The American Cable Association and the National Cable & Telecommunications Association have filed comments with the FCC asking the commission to impose the same regulatory fees on satellite subscribers that cable companies are likely to pay in 2015 — 95 cents a year per subscriber.

The FCC has proposed initially charging satellite operators $0.12 this year per customer, or about one cent a month. The two cable lobbying groups want that 12 cent fee doubled to 24 cents and then raised an additional 24 cents each year until it reaches parity with what cable companies pay.

“The FCC is off to a good start by declaring that Dish and DirecTV should pay regulatory fees to support the work of the agency’s Media Bureau for the first time and proposing setting the initial per subscriber fee at one cent per month in 2015,” said Matthew Polka, president and CEO of the ACA. “But given the FCC proposes that cable operators pay nearly 8 cents per month, per customer, it must do more, including requiring these two multibillion dollar companies with national reach to shoulder more of the fee burden next year that is now disproportionately borne by smaller, locally based cable operators.”

The satellite industry has filed their own comments with the FCC objecting to any significant fee increases, claiming it will cause consumers to experience bill shock and that satellite companies pose less of a regulatory burden on the FCC in comparison to cable operators.

The ACA counters that even if the satellite companies were required to pay the full 95 cents this year — the same rate small independent cable operators pay — it would add a trivial $0.08 a month to customer bills — less than a 0.4% increase on the lowest priced introductory offer sold by satellite providers.

The ACA reminded the FCC it did not seem too concerned about rate shock when it imposed a 99 cent fee on IPTV providers like AT&T U-verse in 2014 without a phase-in.

DirecTV and Dish argue the FCC has jurisdiction over cable’s television, phone and Internet packages — a more complex assortment of services. Satellite providers currently only sell television service, so charging the same fee cable companies pay would be disproportionate and unfair, both claim.

Despite the sudden introduction of the IPTV fee last year, AT&T managed to use the opportunity to turn lemons into lemonade.

AT&T added a “Regulatory Video Cost Recovery Charge” on customers’ bills after the FCC assessed a 99 cent fee on IPTV services like U-verse in 2014. But AT&T charged nearly three times more than what it actually owed. U-verse customers were billed $0.24 a month/$2.88 in 2014 for “regulatory fee cost recovery.” But AT&T only paid the FCC $0.99 for each of its 5.7 million customers. It kept the remaining $1.89 for itself, amounting to $10,773,000 in excess profit.

This year the FCC expects to collect $0.95 from each U-verse subscriber, a four cent decline.

A tiny Madison Avenue investment bank (so small its only web presence is a webpage displaying its logo) that spent one week advising Charter Communications on its merger deal with Time Warner Cable and Altice SA on its acquisition of Suddenlink Communications will earn as much as $65 million in fees if both deals close, according to a report from Bloomberg News.

LionTree Advisors has fewer than 50 employees, which adds up to more than $1 million per worker. Charter is expected to be billed as much as $25 million for the bank’s advice on the Time Warner acquisition and $40 million advising Altice on its buyout of Suddenlink. That represents about $1 from each Charter, Time Warner Cable and Bright House Networks customer and approximately $27 from each Suddenlink customer.

Aryeh Bourkoff and Ehren Stenzler, co-founders of the bank, were more than little thankful to “be a part of these transactions on behalf of our clients.”

With regulators considering rejecting Comcast’s $45 billion merger with Time Warner Cable, investment bankers hoping to reap fat fees “advising” Comcast and Time Warner Cable about the deal are starting to panic they won’t get paid.

Although a merger flop won’t hurt giants like JPMorgan Chase, which operates a 24/7 cash vacuum, continuously sucking fees from companies engaged in Mergermania, smaller “boutique” investment banks like Allen & Co., Centerview Partners, and PJT Partners don’t have that luxury.

Reuters reports some of the smaller investment banks involved in the deal are now on edge, worried they won’t get their share of at least $140 million in investment banking advisory fees that would be paid to complete the Comcast-Time Warner Cable merger deal.

“Big banks have many deals going on, and they can afford to lose one more, even though it is painful. Smaller firms are less diversified, so for them it’s much more painful,” Campbell Harvey, a professor of international business at Duke University’s Fuqua School of Business, told Reuters.

But crying towels are also being readied for investment bankers involved in two side deals involving Charter Communications, which are likely to also fall apart in a chain reaction if the Comcast-Time Warner Cable merger dies.

Charter has deals pending with both Comcast and Time Warner Cable to launch GreatLand Connections and have plans to takeover Bright House Networks, both contingent on the Comcast-Time Warner Cable merger getting approval.

Those two transactions will bring another $170 million in fees to investment bankers, with JPMorgan Chane, former top Morgan Stanley banker Taubman, and Barclays Bank splitting $51-68 million in fees between the three firms.

Time Warner Cable’s own advisers are waiting for $57-75 million in fees as well, among them Morgan Stanley, Allen & Co., Citigroup, and Centerview Partners.

To understand how important the fees are to smaller bankers, Taubman was ranked 23rd in mergers & acquisitions fees in 2014. Without the Comcast deal, Taubman drops out of the top-100.

Some bankers may have negotiated a token fee to be paid by Comcast and Time Warner Cable if the deal falls apart. Most estimates suggest usual fees amount to around 10-15 percent of the amount they would collect if a merger is successfully completed.