Gulp: Sinclair-YouTube Negotiations Break Down, YES Network Off the Air, Scary Implications

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Gulp: Sinclair-YouTube Negotiations Break Down, YES Network Off the Air, Scary Implications

Chicago Cubs

This is one of those bits of news that, on its face, is bad but not crazy bad. But then your mind starts doing some extrapolating and you go to dark, dark places. Maybe I can talk myself through this.

First, the news, then the darkness, then the hopefulness:

You may recall that Sinclair and YouTube TV had reached a temporary extension agreement, with the tenor sure sounding like a deal would be reached before Opening Day for all the regionals.

That was very good news for a couple reasons: (1) it strongly suggested that the Cubs and Marquee – whose carriage is also being negotiated by Sinclair – would get a deal with YouTube TV; and (2) with another major streaming deal in place, that would bode very well for Marquee’s carriage on Comcast (both because it would offer a serious cancellation option for Comcast customers who wanted Marquee, and also because Sinclair is negotiating with Comcast on various other carriage deals).

Can you see why today’s news has me feeling the darkness?

Although Sinclair did manage to make some kind of deal with Google’s YouTube TV for the smaller RSNs, the ones in New York and LA are out in the cold.

“YouTube TV, for its own selfish reasons and with total disregard for its YES customers, has refused to pay the market rate and accept market terms and conditions that other YES distributors have agreed to,” YES Network told SportBusiness. “In fact, YouTube TV sought a rate that was well below what other YES distributors are paying …. Sinclair, for its own reasons, elected to make a deal for some but not all of its programming services which excluded large-market RSNs featuring iconic franchises and star players.”

It is definitely odd that Sinclair would agree to a deal for some RSNs but not all, and that is also a really bad sign for the Cubs and Marquee, because it means that Sinclair is not wielding its national leverage to ensure carriage for all their RSN partners. To be sure, the price tag for YES Network (and presumably Fox Sports West, in LA) is much, much higher than other RSNs. It’s a tougher negotiation to get carriage at the price tag other providers have agreed to … but part of the reason you partner with Sinclair in the first place is so that their national leverage can help the WHOLE GROUP of RSNs get carriage. I’d be pissed if I were the Yankees (and Yankee fans), and it kinda looks like they are. It could be that Sinclair is feeling so much pressure (things have not gone well for them this year) that they have to cut any deal they can get, some partners be damned.

In other words, today’s news *could* mean that Sinclair has also left Marquee out of their negotiations on these deals with YouTube TV. To be sure, we don’t yet know that for a fact. It probably depends on the price tag relative to market, and whether Chicago – from a pricing perspective – is seen as being right there with New York and LA. Ever felt like rooting for Chicago to be considered a small market?

I anticipate we’re going to learn soon whether Marquee is now being dusted by YouTube TV. In the meantime, the Yankees – who are also partners with Amazon, mind you – have informed MLB that they will refuse to allow any of their games to be part of the national broadcasts that the league does on YouTube. They have power and they are scorching some earth.

It really sucks for Yankee fans in the New York area who wanted to be cord cutters. And if this comes to pass in Chicago, the same will be true for Cubs fans (who may have to consider switching to Hulu+ Live TV to get Marquee). *AND* if YouTube is out the window, *AND* if Sinclair is not using its leverage to prop up all RSNs, you wonder what that means for the negotiations with Comcast.

I don’t want to sound like I’m rationally sounding the panic alarm. It’s definitely mostly me being extra concerned about the, you know, 5% possibility that the Yankees and Sinclair and Google and YouTube have just created a ripple effect that is going to eff the Cubs and their fans. Comcast will still have a whole lot of incentive to carry Marquee this year. Unfortunately, though, the world is bigger than just Chicago, and this industry is changing so rapidly and in so many interconnected ways that predicting anything with certainty is impossible.

And that leads to feelings of darkness when you see news like today’s …

… but hey, maybe this is all just more jockeying, and eventually they’ll still get a deal in place and all will be well! That does happen sometimes in these high-stakes negotiations. Maybe YouTube thinks it can take YES off the air for a few weeks and then get a deal done at the zero hour on Opening Day. It does happen. There. Ended on a brighter note.

One more bright note: there is one other big difference between YES Network and Marquee, which could plausibly muck up negotiations with the Yankees but not with the Cubs. The YES Network is part-owned by Amazon, a major Google competitor in a variety of spaces, especially web infrastructure (heck, Google just swiped MLB’s cloud deal from Amazon’s AWS this very week!). And Amazon owns the *exclusive* rights to 21 Yankees games this year, which will be streamed on Amazon Prime. Any chance that was kind of an extra layer that caused a problem in the negotiations with YouTube? Maybe a major layer?



Author: Brett Taylor

Brett Taylor is the Editor and Lead Cubs Writer at Bleacher Nation, and you can find him on Twitter at @BleacherNation and @Brett_A_Taylor.