|Happier Times: David & George|
In an unusual intervention, Disney executive chairman Bob Iger flew across the country to broker peace at ABC News.
Iger smoothed things over and gave Stephanopoulos, 60, a valuable contract extension, defusing the situation. Muir, 47, also remains under a long-term contract.
"They found a way to have two big stars and build towards the future," one of the sources said.
But not without a whole lot of drama along the way. The previously unreported spat showcases the challenges of talent management and how TV anchor roles are evolving in the streaming age.
Spokespeople for ABC News, a unit of Disney, declined to comment for this story. More than half a dozen sources spoke to CNN Business on condition of anonymity.
At issue was a title, "chief anchor," and a key network news responsibility: leading special coverage of breaking news stories and special events.
Stephanopoulos, the co-anchor of "GMA" on weekdays and "This Week" on Sundays, will be adding a production company and prime time specials to his portfolio. Sources said that he will create new shows for Disney-owned platforms like Hulu and National Geographic.
Now, no one at ABC News will have the title of "chief anchor."
The title was invented in 2014, and that's really where this story begins.
Diane Sawyer was stepping down from "World News," the network's flagship evening broadcast, historically the top job at ABC News.
Stephanopoulos was anchoring "GMA" and was, according to some sources, coveting the "World News" chair.
But power was shifting from the evenings to the mornings. As Bill Carter wrote for The New York Times in 2014, "Stephanopoulos is now too important a part of ABC's top-rated morning program, 'Good Morning America' — by far the biggest profit center for the news division — to be moved to the evenings."
Muir was promoted to replace Sawyer at 6:30 p.m. instead.