After a bit of a scare leading up to the October 1 deadline, NBC and YouTube TV have officially agreed to a long-term carriage agreement that will keep NBCUniversal networks on the popular pay TV platform.
According to an announcement by the network on Thursday afternoon, NBC and YouTube TV have come to terms on a distribution deal and will therefore avoid blackouts of popular live sports programming like Sunday Night Football. The two sides reached a short-term agreement earlier this week to keep NBC programming on the platform as details about the new agreement were hammered out.
In addition to announcing a new distribution agreement, NBC revealed it will launch a new version of NBC Sports Network this fall. The channel will likely be used to carry some of Peacock’s exclusive live sports programming, as was first reported earlier this year.
As usual, squabbles over the pricing of NBC-owned networks took center stage. YouTube TV, now the fourth-largest pay TV distributor in the country with approximately 10 million subscribers, sought to negotiate better wholesale prices given the platform’s scale. During YouTube TV’s last set of negotiations with NBC, the platform had about half as many subscribers as it does today.
However, this negotiation also centered around a different issue, that of “ingestion.” As part of the new deal, YouTube TV sought to negotiate the ability to “ingest” NBC-owned content into its platform. What does that mean? Essentially, YouTube TV wants its users to have direct access to NBC-owned on-demand content within YouTube TV itself. For example, if you wanted to watch last night’s episode of Saturday Night Live on Sunday morning, you’d be able to watch directly within YouTube TV rather than having to flip over to Peacock. This concept would extend to Peacock-exclusive live sporting events. Say you wanted to watch a Big Ten basketball game. Instead of launching Peacock, the game would show up within YouTube TV’s channel guide and you could watch there.
Critically, it seems that NBC has only partially given in on this point. In the release, NBCUniversal distribution executive Matt Schnaars said, “We’ve secured long-term access to our full portfolio of broadcast and cable networks on YouTube TV, and we’re advancing our Peacock strategy with an upcoming launch on YouTube Primetime Channels and ongoing presence on Google TV.” This would seem to indicate that NBC is willing to “ingest” its content into YouTube TV as part of YouTube Primetime Channels, though not in the fully bundled sense. Per the release, Peacock will be available “in the coming months” on that service for an additional cost, similar to how Amazon’s Prime Video Channels operates.
“Ingestion” is objectively pro-consumer, but also something that threatens the business model of a streaming service like Peacock, which has invested heavily in content designed to pull viewers into its own app. It’s part of a larger “re-bundling” debate that began in earnest with Disney’s distribution deal with Charter over two years ago in which Disney allowed the distributor to bundle its streaming services, such as Disney+, into its pay TV packages. The differentiator between that deal and an “ingestion” deal is that Charter subscribers still have to launch the Disney+ app to access the content, whereas YouTube TV wants the content integrated within its own platform, thereby collecting valuable user data and tallying more minutes on platform for itself.
While this may spell the end for the NBC-YouTube TV debate, these types of negotiations are far from over. This month, Disney faces its own carriage battle with YouTube TV, much of which will center around the same issues of pricing and ingestion. Additionally, YouTube TV is in ongoing disputes with TelevisaUnivision (owner of Univision and TUDN) and the D.C.-area Monumental Sports Network, all of which are currently dark on the platform.
About Drew Lerner
Drew Lerner is a staff writer for Awful Announcing and an aspiring cable subscriber. He previously covered sports media for Sports Media Watch. Future beat writer for the Oasis reunion tour.