YouTube TV and NBC are headed toward a cliff. If the two sides can’t strike a deal by September 30, subscribers to the streaming service might lose NBC and its affiliated channels like USA, E!, and Bravo. So why is this fight happening now? According to Lightshed Partners, NBCUniversal is trying to force YouTube TV to bundle and pay for Peacock Premium as part of a new affiliation agreement for the NBCU channels.
It’s not unusual for media companies to try to strong-arm cable carriers or live TV streaming providers like YouTube TV. Each side is trying to leverage their offering for the highest possible profit and NBCU is willing to gamble that its fans will raise enough of a ruckus that YouTube TV would cave. Unlike the typical carriage fight, however, NBCU is trying to leverage this situation not into more money, but more Peacock subscribers.
It’s no secret Peacock has had a checkered start. From the delay of the Tokyo Olympics to a sparse slate of original content, it didn’t launch with the same splash as many of its peers. Over time, the library has become more robust and the addition of the WWE gives it something unique. But with Comcast investors demanding explosive streaming growth, they may need something outside-the-box to drive that momentum.
YouTube TV already offers HBO Max access to anyone who subscribes to linear HBO. But everything available on linear HBO is also available on the streaming platform. Peacock does not offer 24/7 live streaming of NBC affiliates or CNBC or MSNBC, so it’s not a 1:1 comparison. You also won’t find content from their regional sports networks.
For its part, YouTube TV says its users can just get a $10/month discount until the battle blows over. That’s enough to pay for Peacock Premium without ads. And that move certainly makes YouTube TV seem like less of the bad guy in this situation.
As these battles play out, each side must tread carefully. NBCUniversal has some leverage with fans of their programming. Sports fans are especially protective of their viewing options. But whenever a content provider pulls its programming behind ever-higher paywalls, a not-insignificant number of viewers simply throw up their hands and walk away. Boxing promoters have made a fortune by going to pay-per-view, but they’ve also whittled their sport’s fanbase down to two dozen old guys smoking cigars at a dimly lit poker table.
We know that linear TV viewing is on the decline across the board, and fights like this aren’t likely to help. YouTube TV has no real incentive to cave in, its subscribers would bristle at a higher base rate if the only benefit was the addition of Peacock, and it would set a precedent that Paramount+, Disney+, ESPN+, and others could follow when their carriage contracts were up.
Lightshed suggests that Comcast may be readying its own vMVPD product, which may make sense, considering the company is also dabbling in set-top boxes. We know that consumers are willing to pay for content, but companies throwing up barriers to that content need to be sure the content is worth paying a premium for. Do NBCU and Peacock have enough unique content to make that case? Stay tuned.