YouTubeTV, Disney (DIS) talks continue as deadline looms
By Andrew Knoll
18:48, 15 December 2021
A dispute between Disney and YouTube TV could cause Disney-owned channels, such as ABC and ESPN, to vanish from the YouTube TV platform this week.
Alphabet-owned YouTube sent a letter to its subscribers and posted an update on its blog indicating that if an agreement was not reached by Friday, they would lower the base cost of their TV streaming platform service to $49.99 a month from $64.99 a month, a 23% decrease. That cost differential tracks roughly with the $13.99 it would cost for users to add Disney’s own streaming bundle of Disney+, ESPN+ and Hulu, which includes much of the content jeopardised by the expiring contract.
“If Disney offers us equitable terms, we will renew our agreement with them. However, if we are unable to reach a deal by Friday, the Disney-owned channels will no longer be available on YouTube TV and we will decrease our monthly price by $15, from $64.99 to $49.99 (while this content remains off our platform),” YouTube TV said. “We would love every member to stay with our service, but we give you the flexibility to pause or cancel your membership anytime. If you want to continue watching some of Disney’s content, you can consider signing up for their own service, The Disney Bundle.”
Earlier in the week, Disney had expressed optimism that amicable terms could be reached.
Opening the door
If an agreement is not reached by Friday, the YouTube-Disney discord could represent an opportunity for competitors, including Disney’s own TV streaming service Hulu.
Hulu’s price for Hulu plus live TV with ads is set to rise to $69.99 from $64.99 on 21 December. However, along with that cost increase comes access to Disney+ and ESPN+.
DIRECTV STREAM, formerly AT&T TV, and the sports-focused fuboTV are among the other competitors who could seek to capitalise on the carriage dispute.
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Old dynamics in new frontiers
In the 2000s, much of the talk around television content was centred on the potential for regional monopolies by cable companies, some of whom would trade minority market shares amongst each other to effectively dominate individual markets. Cable providers in markets like Philadelphia and Los Angeles would make exclusive arrangements to broadcast local sporting events in order to gain an advantage over cable competitors as well as satellite providers, who in turn tried to get their own exclusive content, like DIRECTV’s exclusive holding of NFL SUNDAY TICKET.
Today, streaming services have broken free from regional restrictions in terms of operation and their broadband mode of delivery has streamlined access. That has created an environment of greater consumer choice and customisation, but also one in which there are more business arrangements between more content providers and platforms than ever.
Even in the cable-dominated days, Disney content, ESPN in particular, contributed to more significant costs for cable companies than other content. Today, they are joined by other media giants like Comcast in a marketplace with a dizzying number of content-sharing pacts.
YouTube TV has seen its share of carriage negotiations recently. YouTube TV and the streaming platform Roku recently ended a contract dispute, for instance. In October, YouTube TV and Comcast’s NBCUniversal also extended their deal to keep content from NBC and Telemundo on YouTube TV, avoiding a blackout of channels.
Read more: ROKU stock jumps 18% after Google agreement
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