YouTube TV, Google’s internet pay-TV service, said it will drop the Fox regional sports networks and the YES Network from customer lineups this Saturday, Feb. 29 — citing an impasse in negotiations with Sinclair Broadcast Group, which owns the RSNs.
“We purchase rights from Sinclair to distribute content to you,” the YouTube TV account said in a post on Twitter. “Despite our best efforts, we’ve been unable to reach an agreement with Sinclair. As a result, we will no longer offer Fox Regional Sports Networks, including YES Network, beginning February 29th.”
As part of its Twitter thread, YouTube TV also said, “We do not take this decision lightly. This is a reflection of the rising cost of sports content.” It didn’t give any indication of passing the savings on to customers of the $50-per-month service, however.
In a statement, Sinclair spokesman Ronn Torossian said the broadcaster “offered YouTube TV the best terms under which their competitors carry our regional sports networks. Unfortunately, they alone decided to drop these channels citing ‘rising costs’ despite our offer to actually lower the fees they pay us.” He also said Sinclair offered YouTube TV a short-term extension while both sides continue negotiating but that YouTube has not yet responded to that offer.
YouTube TV’s dispute with Sinclair over the Fox RSNs comes after Dish Network dropped the networks from its satellite and Sling TV services in July 2019. In January, over-the-top pay-TV provider Fubo TV also cut the Fox RSNs loose.
Sinclair in August 2019 acquired the 21 Fox regional sports networks from Disney, which was required to divest the RSNs as part of securing Justice Department approval of its deal for 21st Century Fox’s film and TV businesses. Sinclair under a separate deal acquired an interest in YES Network, which carries New York Yankees and Brooklyn Nets games among other programming.
In the wake of the Sinclair-YouTube TV standoff, YES Network is urging viewers to switch to another service that carries the channel, including Hulu With Live TV and AT&T TV Now.
YouTube TV had over 2 million subscribers at the end of 2019, according to Google. First launched in 2017, the internet-TV package offers over 70 channels including local stations for $50 per month (after raising rates a year ago).
Meanwhile, last week Google struck a deal with WarnerMedia granting YouTube TV carriage rights to HBO and Cinemax for the first time as well as a commitment that WarnerMedia’s HBO Max streaming service will be available on YouTube TV at launch this spring.
Sports programming is the most expensive content in the TV biz. Dish, for one, will save around $400 million per year by not carrying the Sinclair-owned RSNs, according to an estimate from LightShed principal analyst Rich Greenfield in a recent blog post. At the same time, Dish stands to lose $40 million per year in earnings (based on its satellite-subscriber losses over the last six months of 2019).