The never-ending streaming war rages on. This is just the latest dispute in Google’s (NASDAQ: GOOG) YouTube TV dealings following a several-month-long negotiation battle with Roku being resolved just two weeks ago.
The platform cut negotiations close in its most recent game of cat and mouse, with Disney (NYSE: DIS) services being lost in a 2-day blackout. But the pair finally came to an agreement just in time for popular Monday Night Football to be restored to the TV network.
How does it affect YouTube?
YouTube would have lost ESPN, the ABC network, FX, and the Disney channel. Although YouTube TV currently owns and operates more than 85 channels on its platform, it could have been a serious hit for the company in its bid to become a real competitor in streaming if the contract wasn’t renewed.
It seems the house of mouse is looking to strike the best bargains, particularly amid the pandemic times where Disney has seen a negative impact on its Theme Park and Resorts business. Although it wasn’t disclosed what terms the pair came to, a Disney representative stated it appreciated “Google’s collaboration to reach fair terms that are consistent with the market”.
YouTube made good on its promise to customers, however, even though the outage was only temporary before the dispute was put to rest. As a sign of goodwill, the company will be refunding a credit of $15 to its estimated 3-4 million subscribers. The credit is likely to have little effect on the business in the long run, but it could spark customer concern over the reliability of the overall YouTube TV service.
While the negotiating panel over at YouTube might be raising eyebrows, in the grand scheme of things, it’s a win-win for both Google and Disney investors. Disney gets immediate royalties to bolster its business and YouTube attracts new audiences by benefitting from content subscribers know and love.
Financial Writer at MyWallSt
David's favorite stock is Google. He's a daily user of its YouTube platform, where you can learn or find something brand new at the touch of a button. He believes the company will continue to grow for many years to come.