Disney Channels Remain Blocked on YouTube TV, Causing $30 Million Weekly Revenue Loss

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Disney Channels Remain Blocked on YouTube TV, Causing $30 Million
A sign near an entranceway to Walt Disney World on MAY 22, 2023 in Orlando, Florida. Joe Raedle/Getty Images/Getty Images

Disney's standoff with YouTube TV has stretched into its second week, costing the entertainment giant an estimated $30 million in lost revenue every week, according to a new report from Morgan Stanley.

The blackout, now on its 13th day, has left millions of YouTube TV subscribers without access to major Disney-owned networks, including ABC and ESPN.

The dispute began on October 30 after contract talks between Disney and Google-owned YouTube TV collapsed over pricing terms.

According to FoxBusiness, analysts say the outage could cost Disney around $60 million if it lasts two full weeks — roughly $4.3 million per day in missed advertising and affiliate fees.

"Each week of lost distribution could lower Disney's adjusted earnings per share by $0.02," Morgan Stanley wrote in a note to investors.

The firm, however, maintained an "overweight" rating for Disney's stock and set a price target of $140, signaling confidence that the issue will be resolved soon.

The loss of ESPN and ABC comes during one of the busiest sports seasons, disrupting broadcasts of NFL Monday Night Football, NBA games, and college football matchups. For Disney, which relies heavily on sports programming to drive revenue, the timing couldn't be worse.

YouTube TV Offers $20 Amid Disney Dispute

Meanwhile, YouTube TV is working to ease frustration among its roughly 10 million subscribers. The streaming service announced it will offer customers a $20 credit for the disruption, NY Post reported.

"We know it's been disappointing to lose Disney channels," the company said in a post on X. "We remain committed to working with Disney to bring their content back."

If every subscriber redeems the credit, the rebate could cost Google nearly $200 million, though analysts expect only a portion of users to claim it.

Disney executives Dana Walden, Alan Bergman, and ESPN Chairman Jimmy Pitaro said in a memo that YouTube TV "continues to insist on receiving preferential terms that are below market and has made few concessions."

They added that Disney has offered "real savings" in negotiations but wants fair compensation for its content.

YouTube, on the other hand, argues that Disney is demanding higher rates than it charges other providers.

The company said it's working toward a fair deal but won't "pay more than competitors for the same content."

The company has faced similar disputes with Charter and DirecTV in recent years, though none have had the same visibility or subscriber reach as YouTube TV.

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