Fubo is currently challenging the upcoming Venu Sports streaming service, which would be shared by Disney, Fox, and Warner Bros. Discovery (WBD). Earlier this year, Fubo won an injunction against the service, and on November 4, 2024, they filed a 70-page document with the U.S. Court of Appeals for the Second Circuit arguing that the service will be detrimental to any competition.
What is Fubo’s argument?
Fubo is arguing that Disney, Fox, and WBD own the live-streaming “rights to more than half of all U.S. live televised sports content,” which they will leverage into a “skinny sports bundle” that could put competitors out of business.
The crux of the argument is that Venu streamers will not allow competitors to have only the channels they want. Instead, they demand that outside providers carry other unwanted channels that they are charged for. Then, those fees are passed on to customers.
Since Disney, Fox, and WBD are working together, they can make a sports-focused channel at a lower price than any competitor can offer.
(JV stands for “joint venture” meaning the Venu Sports service.)
“They further propose to give their JV the exclusive right to offer consumers the ability to subscribe to sports and only to sports programming – a coveted arrangement known as a ‘skinny sports bundle. No distributor can compete in the market for live pay television without the commercially critical sports content that defendants control and the JV would offer.
As a condition of licensing that content, defendants now force distributors to carry other, unwanted content. Under defendants’ anticompetitive agreement, the [joint venture] would become the only distributor able to carry their sports content without also carrying (and paying for) their other content. That exclusive access would give the JV a built-in advantage over every other distributor – a manufactured pathway to instant market dominance.”
As such the likely outcome of Venu’s “skinny bundle” will see customers leaving the competitors and going to Venu.
Fubo argues that this will put competitors out of business.
If this deal is allowed to go forward Fubo argues that it will render them and others “insolvent.”
“Its artificial advantage will capture hundreds of thousands of subscribers and tens of millions of dollars from Fubo alone, driving Fubo into insolvency, and destroying or damaging other distributors.”
The fear is that if the competition is destroyed the trio would be free to raise prices without competition. Harming not only competitors but the subscribers as well.
Currently Venu is set to price at around $43 a month, with the launch on hold due to the injunction.
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Source: The Wrap
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