ESPN-YouTube TV dispute gets serious as NFL goes dark

For the better part of cable’s existence there have been carriage fights. Distributors like Comcast and networks like ESPN, fight over the terms to put a channel on TV, blaming one another for whatever impasse arises, and then, when NFL football is on the line, suddenly the two sides find their way to a deal.

This weekend, though, Disney’s family of networks – including, most notably, ESPN – stayed dark on Google-owned YouTube TV, causing millions of fans to miss Monday night’s nationally televised showdown between the Dallas Cowboys and Arizona Cardinals. That came on the heels of a full slate of missed college football Saturday, leaving fans across the country irate and thrusting this media skirmish into unfamiliar territory.

The fight is about money, of course. ESPN has spent billions of dollars on live sports rights (mainly the NFL, college football and the NBA) in recent years, so it needs to charge distributors more to cash in on those investments. That’s especially true as cord-cutting means fewer overall homes pay for TV.

YouTubeTV, naturally, wants to pay less. It has also asked Disney, which has always sold its networks as a bundle, to allow it to carry some but not all of its networks. Why should it be forced to pay for, say, National Geographic and Freeform when it really wants ABC and ESPN?

There is a new wrinkle to the wrangling here: YouTube TV is owned by the tech behemoth Google. The service, which now costs more than $80 a month, is the fastest growing TV distributor with around 10 million subscribers, and is on pace to be the largest pay TV distributor as early as next year, surpassing DirecTV and Comcast. It has the market power to challenge the way Disney does business.

In addition to cost, YouTube TV is making an argument over how it would like to deliver ESPN to its subscribers.

ESPN, for example, has launched a stand-alone app and Disney has made ESPN available on skinnier bundles on platforms that it owns, including with Hulu and on Fubo TV. YouTube TV wants similar flexibility, possibly to sell ESPN as part of its own sports bundle or the ability to offer all the bells and whistles of ESPN’s app within the YouTube TV.

“They want to have a one-stop shop where you can watch everything sports in one place,” said Rich Greenfield, founder of media and technology investment firm LightShed Partners, said in an appearance on CNBC’s “Squawkbox” this week. “That obviously isn’t great for anyone with a standalone sports application like ESPN.”

In these disputes, content used to be king. When football fans started clamoring for their NFL games, distributors usually folded. But there was a reason for that: Comcast’s cable business is dependent on having millions of cable subscribers.

Google is not a cable company. The revenue from YouTube TV are just a small fraction of its overall business. ESPN can try to direct fans to its app ($30/month), but the loss of distribution revenue from YouTube TV would be far more meaningful to its bottom line. (According to research firm S&P Global, Disney netted an average of $10.08 per ESPN cable subscriber in 2024.)

But Patrick Crakes, a former Fox Sports executive turned industry consultant, said that would be shortsighted for Google.

“If Google wanted to, they could just pay for every single Disney channel and keep the price for YouTube TV low,” he said. “They’d materially impact all the other Pay TV distributors over the next couple years. Yes, they’d lose money on a cost accounting basis but they’d roll up the business. But they don’t do that. Instead, they seem to want to run the YouTube TV business to try and break even, which is baffling.”

Both Greenfield and Crakes predicted the two sides would come to an agreement soon. But the contours for the next generation of carriage fights have been drawn. And in the meantime, millions of fans are locked out of their favorite sports and scrambling to find alternative viewing options.