YouTube TV Blackout Reveals New Power Dynamic With ESPN: Analyst
Blackout "battles of attrition" between pay-TV providers and distributors will let the former assess the impact of losing carriage fees while they grow their direct-to-consumer services, Ampere Analysis' Sam Nursall wrote Tuesday, pointing to Disney channels going dark last week on YouTube TV. It's the first major dispute with a carrier since Disney released its ESPN app, with the streaming platform "significantly shifting the dynamic between ESPN and carriage partners such as YouTube TV," Nursall said. Instead of relying on carriage agreements with MVPDs and virtual MVPDs, ESPN is now a competitor, especially with the ESPN/Disney+/Hulu bundle, he noted. Between the ESPN app and Fox One app, the vast majority of sports are available in the U.S. via streaming, and the ability of fans to create a streaming-only subscription basket could incentivize further cord-cutting among pay-TV and vMVPD subscribers, he added.
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Nursall also said the blackout could help Disney in multiple ways. It owns YouTube TV's Hulu TV and Fubo competitors, which could benefit from churn, he said. In addition, the ESPN app stands to gain from the blackout as ESPN likely earns more revenue per user from direct subscribers than from a carriage fee related to an individual pay-TV subscriber, he said.