Dispute continues: YouTube TV, Disney fail to reach carriage fee agreement

The ongoing standoff between Youtube TV and Disney over carriage fees has left millions of subscribers without access to popular channels like ABC and ESPN. Both companies have expressed a willingness to reach agreement but have to resolve key financial disputes.

The blackout commenced last Thursday after negotiation failed to produce a new licensing deal. Disney confirmed in a memo to employees on Friday that discussions with Google, YouTube’s parent company, will not lead to any conclusion.

Disney Entertainment co-chairs Dana Walden and Alan Bergman, along with ESPN chairman Jimmy Pitaro, said, “We are headed into another sports-packed weekend without a deal in place”.

Initially, Disney announced a new agreement that would cost YouTube TV less than the recently expired license. The company also offered flexible packages allowing subscribers to choose from sports,  entertainment and family programming. However, Disney executives stated that YouTube TV has requested to receive preferential terms below market value and also has made few concessions.

In response, YouTube denied Disney’s characterization of the negotiations, asserting that it is not seeking lower rates but rather parity with existing industry agreements. In a statement YouTube stated, “Our team stands ready to make a fair agreement in line with their deals with other distributors”.

The Google-owned service also accused Disney of misrepresenting facts and negotiating publicly through paid talent, claiming that Disney is demanding higher rates than those paid by Charter and DirecTV for the same networks.

The dispute revolves around carriage fees, which are the per-subscriber rates that distributors like YouTube TV pay to media companies for carrying their networks. These fees have become a contentious issue as streaming platforms and traditional broadcasters compete for revenue in a shifting television landscape.

Industry analyst predict that such conflicts will become more frequent as streaming services aim to keen subscriptions costs low while media companies strive to maintain revenue from declining cable audiences.

Disney is particularly sensitive about the blackout, as it involves major sports events and political coverage that could impact advertising revenue and viewership. For YouTube TV, which has over eight million subscribers, the absence of ABC and ESPN two of its most watched networks could challenge customer loyalty as sports fans seek alternatives for live coverage.

Apart from their agreements, both companies have reiterated their commitment to restoring services. Disney plans to continue discussion on common ground , while on the other hand, YouTube TV remains firm that it’s offer is fair and according to market. Neither company has provided timeline for the confirmation of the agreement. It has also left subscribers uncertain about the return if their favorite Disney-owned channels.

As blackout continues for another week, sports and entertainment sides remain firm in their positions while facing increased pressure from viewers and advertisers.