Disney and YouTube TV have reached a carriage agreement, ending a pitched battle that dragged on for 15 days, frustrating consumers and fascinating the media business.
Included in the multi-year pact are carriage of ABC and ESPN, a portfolio of other networks. The Unlimited tier of ESPN’s new direct-to-consumer streaming outlet will also be included at no extra charge for YouTube TV’s 10 million subscribers. The “duo bundle” of Disney+ and Hulu will also be made available in “select YouTube offerings,” the companies said, and certain networks will also be part of genre-specific packages.
The genre packages and access to the new ESPN streaming service, which launched in August as a major hedge against cord-cutting, had been on the priority list for Disney negotiators for months. While comments by executives largely centered on disputes over pricing and fair market value, a sticking point in the negotiations – ingestion – reflected the complexities of the streaming era.
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The new pact includes a form of ingestion, according to a person familiar with the details, but not into YouTube’s channel store. Content from ESPN Unlimited will be incorporated into the user experience of YouTube TV, allowing subscribers to view it within the app as opposed to having to jump out to the ESPN app. Allowing YouTube to ingest content into its channel store is a more existential threat to programmers over the long term, as the tech giant would control the data and make running a direct-to-consumer business unsustainable.
“This new agreement reflects our continued commitment to delivering exceptional entertainment and evolving with how audiences choose to watch,’’ Disney Entertainment Co-Chairmen Alan Bergman and Dana Walden and ESPN Chairman Jimmy Pitaro. “It recognizes the tremendous value of Disney’s programming and provides YouTube TV subscribers with more flexibility and choice. We are pleased that our networks have been restored in time for fans to enjoy the many great programming options this weekend, including college football.”
YouTube TV, which has grown into one of the top U.S. pay-TV providers since launching in 2017, will restore programming, including titles stored on cloud DVRs, from Disney over the next 24 hours. The restoration came in time for viewers to be able to tune in for a packed college football slate and Monday Night Football‘s Dallas Cowboys-Las Vegas Raiders game. At 15 days, the blackout was the longest ever for Disney and was threatening to extend a drought of college football to a third weekend in the prime of the season.
“We’re happy to share that we’ve reached an agreement with Disney that preserves the value of our service for our subscribers and future flexibility in our offers,” a YouTube spokesperson said in a statement. “We apologize for the disruption and appreciate our subscribers’ patience as we negotiated on their behalf. “