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YouTube vs. Disney: What’s behind the fight

YouTube TV customers are bracing for another frustrating weekend.

For the last week, YouTube TV’s 10 million subscribers have been denied access to ESPN, ABC and other Walt Disney Co. channels in a dispute that has swelled into one of the largest TV blackouts in a decade. Instead of turning on “College GameDay,” “Monday Night Football” or “Dancing With the Stars,” customers have been greeted with a grim message: “Disney channels are unavailable.”

The standoff began Oct. 30 when the two behemoths hit an impasse in their negotiations over a new distribution contract covering Disney’s channels and ABC stations.

Google, which owns YouTube, has rebuffed Disney’s demands for fee increases for ESPN, ABC and other channels. The Burbank entertainment giant has been seeking a revenue boost to support its content production and streaming ambitions, and help pay for ESPN’s gargantuan sports rights deals.

Talks are ongoing, but the two sides remain apart on major issues — prolonging the stalemate.

“Everyone is kind of sick of these big-time companies trying to get the best of one another,” said Nick Newton, 30, who lives near San Francisco and subscribes to YouTube TV. “The people who are suffering are the middle-class and lower-class people that just love sports … because it’s our escape from the real world.”

Both companies declined to comment for this article.

The skirmish is just the latest between YouTube and programming companies. Since August, Rupert Murdoch’s Fox Corp., Comcast’s NBCUniversal and Spanish-language broadcaster TelevisaUnivision have all complained that YouTube TV was trying to use its market muscle to squeeze them for concessions.

Here’s a look at what’s driving the escalating tensions:

Google’s growing clout in television

The struggle between Disney and YouTube reflects television’s fast-shifting dynamics.

Disney has long entered carriage negotiations with tremendous leverage, in large part because it owns ESPN, which is a must-have channel for legions of sports fans.

Programmers, including Disney, structured their distribution contracts to expire near a pivotal programming event, such as a new season of NFL football. The timing motivated both sides to quickly reach a deal rather than risk alienating customers.

But for Google’s parent, Alphabet, YouTube TV is just a sliver of their business. The tech company generated $350 billion in revenue last year, the vast majority coming from Google search and advertising. That gives YouTube a longer leash to hold out for contract terms it finds acceptable.

“This dispute is not that painful for Google,” said analyst Richard Greenfield of LightShed Partners, noting that YouTube TV could probably withstand “two weekends without college football, and two weeks without ‘Monday Night Football’ — as long as their consumers stay with them.”

Disney, however, depends on TV advertising and pay-TV distribution fees. The week-long blackout has already dampened TV ratings, which means less revenue for the company.

Consumers like YouTube TV

For decades, throngs of consumers loathed their cable company — a sentiment that Disney and other programmers were able to use in their favor in past battles. Customer defections prompted several pay-TV companies to find a compromise to restore the darkened TV channels and stanch the subscriber bleeding.

But YouTube is banking on a more loyal user base, including millions of customers who switched to the service from higher-priced legacy providers.

“I’ll stick this thing out with YouTube TV,” Newton said, adding that he hoped the dispute didn’t drag on for weeks.

“This is one of the problems facing Disney,” Greenfield said. “It’s been a noticeable change in tone from past carriage fee battles. If customer losses stay at a minimum, then Disney is going to be in a tough place.”

It boils down to power and money

YouTube TV is the fastest-growing television service in the U.S. Analysts expect that, within a couple of years, YouTube TV will have more pay-TV customers than industry leaders Spectrum and Comcast.

In the current negotiations, Google has asked Disney to agree to lower its rates when YouTube TV surpasses Comcast’s and Spectrum’s subscriber counts. Disney maintains that YouTube already pays preferred rates, in recognition of its competitive standing, and that Google is trying to drive down the value of Disney’s networks.

“YouTube TV and its owner, Google … want to use their power and extraordinary resources to eliminate competition and devalue the very content that helped them build their service,” top Disney executives wrote last Friday in an email to their staff.

People close to YouTube TV reject the characterization, saying the service has been a valuable partner by providing a strong service that brings Disney billions of dollars a year in distribution revenue.

“The bottom line is that our channels are extremely valuable, and we can only continue to program them with the sports and entertainment viewers love most if we stand our ground,” the Disney executives wrote in last week’s email. “We are asking nothing more of YouTube TV than what we have gotten from every other distributor — fair rates for our channels.”

Higher sports rights fees

A major reason Disney is asking for higher fees is because it’s grappling with a huge escalation in sports costs.

Disney is on the hook to pay $2.6 billion a year to the NBA, another $2.7 billion annually to the NFL, and $325 million a year for the rights to stream World Wrestling Entertainment. Such sports rights contracts have nearly doubled in the last decade, leading to the strain on TV broadcasters.

In addition, deep-pocketed streaming services, including Amazon, Apple and Netflix, have jumped into sports broadcasting, driving up the cost for the legacy broadcasters.

The crowded field also strains the wallets of sports fans, and appears to be adding to the fatigue over the YouTube TV-Disney fight.

Newton wrote in a recent Twitter post that he was spending $400 a month for his various internet, phone and TV services, including Disney+ and NFL Sunday Ticket, which is distributed by YouTube TV.

“I’m already on all the major subscriptions to watch football these days,” Newton, a third-generation San Francisco 49ers fan, said. “You need Netflix. You need Peacock, you need Amazon Prime and the list goes on and on. I’m at the point where I’m not paying for anything else.”

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Disney asks YouTube TV to restore ABC for election coverage

Millions of YouTube TV subscribers could miss “Monday Night Football” on ESPN and ABC News’ election day coverage as the blackout of Walt Disney-owned channels stretches into a second week.

“Monday Night Football” features the Dallas Cowboys battling the Arizona Cardinals. In addition, several important political contests are on Tuesday ballots, including the New York City mayor’s election, gubernatorial races in Virginia and New Jersey, and California’s Prop. 50 to decide whether officials can redraw the state’s congressional map to favor Democrats.

Disney on Monday sought a temporary thaw in tensions with Google Inc. after the two sides failed last week to strike a new distribution contract covering Disney’s television channels on Google’s YouTube TV.

“Despite the impasse that led to the current blackout, we have asked YouTube TV to restore ABC for Election Day so subscribers have access to the information they rely on,” a Disney spokesperson said in a statement Monday. “We believe in putting the public interest first and hope YouTube TV will take this small step for their customers while we continue to work toward a fair agreement.”

A Google spokesperson was not immediately available for a comment.

ABC’s “World News Tonight With David Muir” is one of television’s highest rated programs.

More than 10 million YouTube TV customers lost access to ESPN, ABC and other Disney channels late Thursday after a collapse in negotiations over distribution fees for Disney channels, causing one of the largest recent blackouts in the television industry.

The two TV giants wrangled for weeks over how much Google must pay to carry Disney’s channels, including FX, Disney Jr. and National Geographic. YouTube TV — now one of the largest pay-TV services in the U.S. — has balked at Disney’s price demands, leading to the outage.

YouTube TV does not have the legal right to distribute Disney’s networks after its last distribution agreement expired.

“We know this is a frustrating and disappointing outcome for our subscribers,” a YouTube spokesperson said in a statement last week. “We continue to urge Disney to work with us constructively to reach a fair agreement that restores their networks to YouTube TV.”

YouTube has said that should the outage stretch for “an extended period,” it would offer its subscribers a $20 credit.

Spanish-language TelevisaUnivision-owned channels were knocked off YouTube TV in a separate dispute that has lasted more than a month. Televisa has appealed to high-level political officials, including President Trump and Federal Communications Commission Chairman Brendan Carr.

Last year, after Disney-owned channels went dark on DirecTV in a separate carriage fee dispute, Disney offered to make available to DirecTV subscribers its ABC coverage of the sole presidential debate between President Trump and then-Vice President Kamala Harris.

DirecTV viewed ABC’s offer as something of a stunt, noting the debate would be streamed. DirecTV countered by asking Disney to instead make all of its channels available.

That fee dispute resulted in a 13-day blackout on DirecTV, one that was resolved a few days later.

Heightened tensions in the television industry have led to numerous blackouts.

In 2023, Disney and Charter Communications were unable to iron out a new contract by their deadline, resulting in a 10-day blackout of Disney channels on Charter’s Spectrum service. A decade earlier, Time Warner Cable subscribers went nearly a month without CBS-owned channels.

Programming companies, including Disney, have asked for higher fees for their channels to help offset the increased cost of sports programming, including NFL and NBA contracts. But pay-TV providers, including YouTube have pushed back, attempting to draw a line to slow their customers’ ever-increasing monthly bills.

More than 40 million pay-TV customer homes have cut the cord over the last decade, according to industry data. Many have switched to smaller streaming packages. YouTube TV also benefited by attracting disaffected customers from DirecTV, Charter Spectrum and Comcast. YouTube TV is now the nation’s third-largest TV channel distributor.

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ESPN, Disney channels blacked out on YouTube TV in contract dispute

More than 10 million YouTube TV customers lost access to ESPN, ABC and other Walt Disney Co. channels after contract talks broke down Thursday night in one of the largest television blackouts in recent years.

The Disney blackout was set to begin by 9 p.m. Thursday, interrupting “SportsCenter with Scott Van Pelt” on ESPN and “9-1-1: Nashville” and “Grey’s Anatomy” on ABC.

The two TV giants have been wrangling for weeks over carriage fees for Disney’s channels, including FX, Disney Jr. and National Geographic. YouTube TV — now one of the largest pay-TV services in the U.S. — has balked at Disney’s price demands, fueling the dispute that spilled beyond Thursday’s deadline for a new deal.

Without an agreement, Google-owned YouTube TV no longer had legal rights to distribute Disney’s channels.

“We know this is a frustrating and disappointing outcome for our subscribers,” a YouTube spokesperson said in a statement. “We continue to urge Disney to work with us constructively to reach a fair agreement that restores their networks to YouTube TV.”

Should the outage stretch for “an extended period,” YouTube said it would offer subscribers a $20 credit.

The blackout highlights heightened tensions in the television industry.

Programming companies, including Disney, have sought higher fees for their channels to help offset the increased cost of sports programming, including NFL and NBA contracts.

But pay-TV providers such as YouTube have pushed back, attempting to draw a line as customers grow weary of ever-increasing monthly bills.

They don’t want to lose subscribers to a rival service or have them drop their subscriptions. More than 40 million pay-TV customer homes have cut the cord over the last decade, according to industry data.

Disney becomes the latest TV programmer to allege that Google has been throwing its weight around in contract negotiations.

People close to the Burbank entertainment giant accuse YouTube TV of refusing to pay market rates for Disney’s popular channels or accept terms accepted by other pay-TV distributors. Disney has clinched deals with six other pay-TV companies this year, including the nation’s largest channel distributors, Charter Spectrum and Comcast.

“Unfortunately, Google’s YouTube TV has chosen to deny their subscribers the content they value most by refusing to pay fair rates for our channels, including ESPN and ABC,” Disney said in a statement. “Without a new agreement in place, their subscribers will not have access to our programming, which includes the best lineup in live sports – anchored by the NFL, NBA, and college football, with 13 of the top 25 college teams playing this weekend. With a $3 trillion market cap, Google is using its market dominance to eliminate competition and undercut the industry-standard terms we’ve successfully negotiated with every other distributor.”

Since August, Rupert Murdoch’s Fox Corp., Comcast’s NBCUniversal and Spanish-language broadcaster TelevisaUnivision have all complained that YouTube TV was trying to use its clout to squeeze them for concessions now that YouTube TV has become so popular with consumers.

Ultimately, Fox and NBCUniversal negotiated new distribution contracts with Google without having their channels going dark.

Univision wasn’t as fortunate; its channels have been off YouTube TV for nearly a month.

YouTube TV, for its part, has alleged that Disney was the one making unreasonable demands. The San Bruno, Calif.-based platform cited recent agreements it reached with NBCUniversal and Fox..

“Last week Disney used the threat of a blackout on YouTube TV as a negotiating tactic to force deal terms that would raise prices on our customers,” YouTube TV said in a statement. “They’re now following through on that threat. … This decision directly harms our subscribers while benefiting their own live TV products, including Hulu + Live TV and Fubo.”

Both Disney’s Hulu service and Fubo compete with YouTube TV by offering packages of many of the same traditional channels.

YouTube has alleged that Disney is using the blackout to steer disaffected YouTube TV customers to Disney-owned streaming services after the Burbank company lost subscribers who canceled following the late-night comedian Jimmy Kimmel’s brief suspension last month.

The two companies’ fraught dealings extend beyond the negotiations.

Last spring, Disney’s former distribution chief, Justin Connolly, abruptly exited to take a similar position at YouTube TV. Connolly had spent two decades at Disney and ESPN and helped devise the company’s distribution strategy. Disney sued to block the move, but a judge allowed Connolly to take his new position — putting him on the opposite side of the negotiation table.

It’s unclear how long the impasse might last.

A separate distribution fee dispute between Disney and DirecTV last year resulted in a 13-day blackout of Disney channels for customers of the El Segundo-based television provider. In 2023, another ugly tussle led to Disney channels being dropped from Charter’s Spectrum service for 10 days.

News and sports fans might quickly notice the absence of their favorite channels.

They could miss college football on ESPN and ABC as well as a “Monday Night Football” game between the Arizona Cardinals and Dallas Cowboys.

A football player holds a ball.

ESPN is scheduled to televise a University of Miami-SMU football game on Saturday.

(Jason Allen / Associated Press)

Disney’s ABC stations, including KABC-TV in Los Angeles, and the network’s affiliate stations around the country also will be unavailable on YouTube TV.

That means viewers could miss local newscasts, “Jeopardy,” “Wheel of Fortune,” “Good Morning America” and “Jimmy Kimmel Live.”

YouTube TV launched in April 2017 for $35 a month. The package of channels now costs $82.99.

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