YouTube TV is firmly in line to become the No. 1 pay-TV distributor as soon as next year, and this week made multiple moves to burnish its presence with sports fans.
The Google-owned entity completed the long-awaited integration of one major distribution pact, while striking another, and solidified the availability of two high-profile streaming services within the overall YouTube footprint. Among the latest moves:
- ESPN Unlimited, the sports media giant’s direct-to-consumer service, is now directly accessible within YouTube TV, and subscribers are now able to link YouTube and ESPN accounts. This integration has long been widely anticipated since YouTube TV and ESPN parent company Disney completed a carriage agreement last fall after months of rancor. The process of combining the services, known within the industry as ingestion, has quickly become a critical part of many other deals between distributors and programmers as the lines blur further between linear programming and streaming. YouTube VP of subscription products Christian Oestlien said Tuesday the ESPN move was “just an initial step” toward a broader upgrade.
- NBCUniversal, in the process of separating from parent company Comcast, completed a long-term carriage extension with YouTube TV. Among the key elements in the new pact are the inclusion of Peacock in YouTube Premium, the ad-free version of its core video offering, beginning next year—providing a subscriber boost in the millions to Peacock. Additionally, NBC Sports will produce “select premiere live sporting events” shown on YouTube. The newly profitable Peacock has long boasted one of the most comprehensive sports programming lineups anywhere in streaming, with NBC Sports holding rights to the NFL, NBA, MLB, Premier League, and Olympics, among others.
“We’re pairing [our] ultimate viewing experience with Peacock’s expansive lineup of live sports like Sunday Night Football and the NBA, blockbuster Universal movies, and original series,” said YouTube CEO Neal Mohan. “This makes it easier than ever for our members to find and watch all the premium content they love.”
That sentiment is another marked change after YouTube TV had a difficult carriage negotiation last year with NBCUniversal, separate from the battle it also had with Disney.
Market Factors
These steps, providing direct access on YouTube TV to a wide array of major sports leagues and events, collectively arrive as the service is set to soon pass its two top competitors among U.S. pay-TV distributors. YouTube TV is estimated to have more than 10 million subscribers, approaching the 12.5 million most recently reported for Charter’s Spectrum service and the 10.67 million for Comcast.
Both Spectrum and Comcast, however, continue to shed considerable numbers of linear cable customers each quarter as cord-cutting accelerates across the industry. Amid that broad shift, Comcast’s Xfinity has even started selling YouTube TV as an add-on option for its internet-only subscribers.
Price pressures, meanwhile, remain highly salient. YouTube TV’s base price starts at $82.99 per month—a cost that looks increasingly like those for traditional linear packages that many consumers have abandoned for a streaming-based offering. YouTube TV also offers a sports-oriented skinny bundle beginning at $64.99 per month and featuring content from both ESPN and NBC, among others.
Overall, YouTube continues to pace the U.S. media industry in overall television and streaming consumption. The company claimed 13.8% of all viewing hours during May, according to Nielsen, easily above No. 2 and top rival Netflix at 8%.
