Disney (DIS) has pulled its channels, including ESPN and ABC, from Google’s (GOOGL) YouTube TV after the two companies failed to reach a new licensing agreement. The breakdown in talks has led to a blackout affecting millions of YouTube TV subscribers, cutting off access to most-watched sports and entertainment networks. The agreement between Disney and YouTube TV expired at midnight on Thursday, October 30.
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Disney-YouTube TV Showdown
YouTube TV said in a post on X, “Our contract with Disney has reached its renewal date, and we’ll not agree to terms that disadvantage our members while benefiting Disney’s TV products.”
On the other hand, a Disney spokesperson stated that Google is leveraging its massive size to squeeze competitors and push for terms below the industry standards that we’ve consistently secured with all other distributors.
Additionally, Disney and other media companies argue that their content is what makes YouTube TV appealing to viewers, so they deserve fair compensation. The company also stated that YouTube TV is using its growing power in the market to demand tougher terms during negotiations.
On the other hand, YouTube TV argued that Disney’s proposed terms would drive up prices for consumers and unfairly benefit Disney’s own live TV platforms, including Hulu + Live TV.
YouTube TV Stands Its Ground
YouTube TV is among the biggest pay-TV services in the U.S. This year, it has been busy securing new content deals with major media companies. Recently, the platform signed a multi-year agreement with Comcast’s (CMCSA) NBCUniversal, ensuring that hit shows like Sunday Night Football and America’s Got Talent stay available to its subscribers.
Before this, YouTube TV reached an agreement with Fox (FOXA) to keep Fox News, Fox Sports, and other Fox channels available to its subscribers.
In its Q3 results released on Wednesday this week, YouTube reported ad revenue of $10.26 billion, up from $8.92 billion a year earlier, driven by stronger brand and performance campaigns.
Are Google Shares a Good Buy?
Overall, Wall Street analysts have a Strong Buy consensus rating on GOOGL stock based on 28 Buys and nine Holds assigned in the past three months. The average GOOGL price target of $306.06 per share implies a 8.73% upside potential.
