Paramount Global television networks, including CBS, could go dark on Google’s YouTube TV on Thursday night in the latest contract showdown between a major programmer and a distributor.
Paramount began warning CBS, BET and Comedy Central viewers that a blackout was likely as negotiations went down to the wire with executives who run YouTube TV. The deadline for a new carriage deal is 8 p.m. PT on Thursday.
“We remain hopeful that we can reach an agreement that fairly recognizes the full power of our brands and popular programming,” Paramount’s leaders said in a note to employees.
YouTube TV has grown into one of the industry’s most popular multichannel distributors, with 8 million customers.
“We’ve been working hard to reach a fair agreement with Paramount that allows us to keep their channels, including CBS and CBS Sports, on YouTube TV without passing on additional costs to our subscribers,” YouTube said in a blog post. “Unfortunately, despite our good faith negotiations, we haven’t been successful yet.”
YouTube TV got a subscriber boost when it took over the NFL’s “Sunday Ticket” offering in 2023 after that package became too expensive for longtime rights-holder DirecTV. However, the nearly $2-billion-a-year price for the Sunday afternoon NFL games drove up the cost of operating YouTube TV, prompting Google to scrutinize other contract costs.
Cable channel fee disputes have become increasingly common in the television industry. This dispute shows that Google is not immune from the financial challenges facing traditional distributors, including DirecTV, Dish Network, Charter Spectrum and Comcast Xfinity.
YouTube TV has offered lower-cost promotions to recruit customers defecting from DirecTV and other services.
Last month, YouTube TV raised its charge to customers to $82.99 a month, up from $72.99 a month.
The company said it would offer YouTube TV customers an $8 credit a month “if we can’t reach an agreement and [Paramount] content is unavailable for an extended period of time,” Google said in a blog post. “Paramount is an important partner for us and as you can imagine, this is not the outcome that we want.”
Paramount entered this year’s negotiations with a weaker hand than it had when YouTube TV launched eight years ago.
Paramount’s cable channels, including Nickelodeon and MTV, have lost millions of subscribers amid a migration to such video-on-demand streaming services as Netflix, Disney+ and Paramount+. In August, Paramount took a $6-billion write-down to account for the declining value of its cable television portfolio. The company has endured several rounds of layoffs.
CBS, with its news and entertainment programming, including “Tracker,” “Ghosts” and “The Late Show With Stephen Colbert,” is Paramount’s biggest draw.
Paramount’s controlling shareholder Shari Redstone struck a deal last summer to sell the company to David Ellison’s Skydance Media. The $8-billion deal has hit a snag at the Federal Communications Commission. The agency must sign off on the transfer of the CBS television licenses to Ellison for the deal to go forward.
The dispute with Google becomes Paramount’s latest corporate headache. CBS is also sparring with Sony Pictures Television to retain distribution rights for Sony’s hugely popular “Jeopardy!” and “Wheel of Fortune.”
