Sling TV is probably having a good chuckle right now. The streaming service that offers cable TV channels and internet-based content in a package does not offer broadcast networks, meaning that they avoid the tense negotiations that go along with network contract renewals and affiliates battles. While it does offer Comcast-owned channels nothing hangs over the head of a provider like the loss of one of the big four broadcast channels in the middle of an NFL season. And that’s where YouTube TV is now.
Comcast and YouTube TV are doing the dance that used to be reserved for legacy cable and satellite providers. YouTube TV will be without Comcast-owned channels unless the two companies work out a deal to continue to have the networks part of the new style TV bundle.
The standoff means that if things are not worked out YouTube TV customers will lose USA, Syfy, NBC, CNBC, MSNBC and others. Maybe YouTube TV is not concerned about losing those channels. Services have dropped entire channel bundles before. Viacom famously lost a couple of partners for some time and both sides lived to fight another day. But this disagreement may have a different kind of ending that could land decidedly in Comcast’s favor. This is because Comcast has a major counter punch to losing access on YouTube TV. Peacock.
According to arsTECHNICA the impasse between the two companies started when Comcast asked that YouTube TV pick up Peacock Premium as part of the renewal deal. Peacock Premium is built into TV packages from Comcast and Cox Cable. And if you have been following Peacock since before it hatched you will remember that Comcast had planned to have the service built-in with multiple traditional providers technically making it free to those customers. Of course, what it really wanted was for the providers/cable companies to pay for the service so that it could provide it. As you can see so far most providers have not jumped aboard. Even more, the average customer has not gravitated to the service as a paid option either. While Peacock has millions of active accounts it appears that the service’s free content is just fine. You can tell because Peacock/Comcast does not publish the number of Peacock Premium subscribers.
Now though we have to ask. Is Comcast pulling some sort of rope-a-dope? And even more, is YouTube falling for it? Think about this. YouTube has said it will cut the cost of its service by $10.00 while it is unable to offer Comcast channels. Meanwhile, YouTube is actually telling customers they can get NBC sports content and after air viewing of NBC Universal content on Peacock. I don’t think YouTube TV understands what it’s doing here. It might be giving Comcast exactly what it wants. Direct access to customers. If consumers take YouTube TV at their suggestion and add Peacock and find that it works just fine for them then YouTube TV might be forced to keep their prices lower. And even more if they turn around and raise them without adding the Comcast content back consumers will howl. Even worse they might just jump to another provider. Meanwhile, Comcast may rake in more actual Peacock Premium customers along the way. Comcast has to know that the traditional bundle, whether it is part of a legacy TV service such as their own or an Internet-based one, is on the way out. And the content owners have all been working on their own spins for direct-to-consumer offerings. Disney for instance offers Hulu, Disney+ and ESNP+ for $13.99 and has been steadily adding to the live sports content on ESPN+. ViacomCBS offers access to shows from its myriad channels along with a live feed of CBS via Paramount+. But because Peacock was last into the ring it failed to make the impact that others did. And at the moment while Peacock does offer live content from NBC sports such as NFL and College football, you can not currently watch a live feed of your local NBC affiliate via Peacock. Here’s a guess that this will change at some point.
Let’s just say that YouTube TV calls Comcast’s bluff. And it stops carrying all of its channels permanently and even keeps the price drop (which I doubt). What happens when Disney comes a calling for renewal? Will YouTube TV be willing to lose the entire ESPN lineup, Disney lineup, and access to ABC? Will it offer to lower its cost again and tell people they can sign up for Hulu in order to watch ABC shows? Boy, would that be a mistake. In fact when that moment does come expect Disney to wield its own competing service like a bludgeon. YouTube TV won’t carry your ABC stations and ESPN anymore but guess who will, “Hulu with Live TV”.
The cable industry ignored people’s propensity to choose cheaper delayed viewing options to its own detriment expecting that consumers would eventually come back around to understanding the value of the big bundle. They have not. And while the cable replacement services have picked up some of the former cable customers there are many who have just learned to watch TV in other ways. And now that services like Peacock also give viewers access to live sports the need for a linear network decreases exponentially.
What if that is exactly what Comcast knew when it launched Peacock in the first place. Your move Google.
