More than 10 million YouTube TV customers lost access to ESPN, ABC and other Walt Disney Co. channels after contract negotiations collapsed Thursday night in one of the largest television blackouts in recent years.
The Disney blackout was scheduled to begin at 9 p.m. Thursday, disrupting “SportsCenter with Scott Van Pelt” on ESPN and “9-1-1: Nashville” and “Grey's Anatomy” on ABC.
The two TV giants have been arguing for weeks over streaming fees for Disney channels, including FX, Disney Jr. and National Geographic. YouTube TV, now one of the largest pay-TV services in the United States, has objected to Disney's pricing demands, fueling the dispute that extended past Thursday's deadline for a new deal.
Without a deal, Google-owned YouTube TV no longer had legal rights to distribute Disney channels.
“We know this is a frustrating and disappointing result 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 its networks to YouTube TV.”
If the outage lasts for “an extended period,” YouTube said it would offer subscribers a $20 credit.
The blackout highlights growing tensions in the television industry.
Programming companies, including Disney, have sought higher rates for their channels to help offset the rising cost of sports programming, including NFL and NBA contracts.
But pay TV providers like YouTube have pushed back, trying to draw a line in the road as customers tire of ever-increasing monthly bills.
They don't want to lose subscribers to a rival service or have them abandon their subscriptions. More than 40 million households with pay TV customers have cut the cord in the last decade, according to industry data.
Disney becomes the latest TV programmer to allege that Google has been exerting influence in contract negotiations.
People close to the Burbank entertainment giant accuse YouTube TV of refusing to pay market rates for popular Disney channels or accept terms accepted by other pay-TV distributors. Disney has closed deals with six other pay-TV companies this year, including the country's largest channel distributors, Charter Spectrum and Comcast.
“Unfortunately, Google's YouTube TV has chosen to deny its 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, your subscribers will not have access to our programming, which includes the best live sports programming based on the NFL, NBA and college football, with 13 of the top 25 college teams playing this weekend. With a market capitalization of $3 billion, Google is using its market dominance to eliminate competition and undermine the industry-standard terms we have successfully negotiated with all other distributors.”
Since August, Rupert Murdoch's Fox Corp., Comcast's NBCUniversal and Spanish-language broadcaster TelevisaUnivision have complained that YouTube TV was trying to use its influence to win concessions now that YouTube TV has become so popular with consumers.
In the end, Fox and NBCUniversal negotiated new distribution deals with Google without their channels going dark.
Univision was not so lucky; Their channels have been off YouTube TV for almost a month.
YouTube TV, for its part, has alleged that Disney was the one making unreasonable demands. The San Bruno, California-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 settlement terms that would increase prices to our customers,” YouTube TV said in a statement. “Now they are making good on that threat… This decision directly harms our subscribers while also 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 bundles of many of the same traditional channels.
YouTube has alleged that Disney is using the blackout to direct disgruntled YouTube TV customers to Disney-owned streaming services after the Burbank company lost subscribers who canceled following late-night comedian Jimmy Kimmel's brief suspension last month.
The tense agreements between the two companies extend beyond the negotiations.
Last spring, former Disney distribution chief Justin Connolly abruptly resigned to take a similar position at YouTube TV. Connolly had spent two decades at Disney and ESPN and helped shape the company's distribution strategy. Disney sued to block the move, but a judge allowed Connolly to assume his new position, putting him on the opposite side of the negotiating table.
It is unclear how long the stalemate could 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 fight caused Disney channels to be removed from Charter's Spectrum service for 10 days.
News and sports fans may 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 the Dallas Cowboys.
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 nationwide will also not be available 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 per month. The channel package is now $82.99.
