The Likely Winner of the Disney/Charter-Spectrum Dispute? YouTube TV

For those interested in the media industry, the Disney/Charter carriage dispute could become a watershed moment for the Pay TV industry. Charter, the second-largest cable provider in the United States with 15 million subscribers, has been in a carriage-fee dispute with Disney. As a result, subscribers have lost access to ESPN, Disney, and ABC for the last six days.

Charter’s pro-consumer demands are reasonable: they want their subscribers to have access to the ad-supported tiers of Disney’s streaming services. Why should Charter subscribers pay a third of their cable bill for Disney and ESPN without access to all their content? Currently, cable companies are paying for their own deaths, essentially financing the studios’ foray into streaming services, a move that may ultimately phase out cable TV. When Disney eventually offers an ESPN streaming service, one of cable television’s last attractions will disappear. Why shouldn’t cable companies fight back?

Interestingly, however, cable companies may have an edge over studios. Cable is no longer the primary focus for most of these companies; mobile and broadband services are. However, studios rely heavily on carriage fees to fund their transition from cable to streaming. They’re in a precarious position, reluctant to shut off the cable revenue before acquiring enough streaming subscribers to make up the difference.

Meanwhile, Charter might actually follow through on its threat to abandon its cable services if Disney doesn’t cooperate. For the Pay TV sector, this sounds dire: 25% of cable TV subscribers could be gone, along with billions in carriage fees for Disney, Paramount, NBC/Universal, and Warner. Those studios would lose their ability to continue financing their streaming services.

However, the scenario is unlikely to play out this way. If Charter drops its cable TV service, subscribers will likely switch to streaming cable options. Although Charter doesn’t offer ESPN or Disney, YouTube TV and Hulu Live do — and they’re just a click away. No need to wait for a technician to set up the service between the hours of 12 p.m. and 11 a.m. the next day.

Viewers of Fox News, ESPN, and MSNBC won’t lose access; they’ll simply switch and adapt. In fact, every cable provider in America continues to lose subscribers except for one: YouTube TV. It may be pricey, but it’s convenient and now the exclusive home of NFL Sunday Ticket. Charter subscribers concerned about missing NFL games can switch providers and catch not just the in-market games, but every game.

There won’t be a cable TV apocalypse, not yet anyway — just a shift in the landscape. More people will subscribe to YouTube TV, while fewer will stick with Charter — I’d be surprised if tens of thousands haven’t already made the switch — but they’ll all continue to pay too much for 150 channels, only a handful of which they actually watch.