The recently announced Discovery Sports streaming service from Disney, Fox and Warner Bros. isn't exactly a gang-bang to many in the industry, and probably not to the government either.
Fubo was the first to file a lawsuit, but he may not be the last. On February 20, Fubo TV Inc., which describes itself as the “leading sports-first live TV streaming platform,” filed an antitrust lawsuit against three of its new joint venture companies and their affiliates. The lawsuit alleges that Disney, Fox, and WBD “engaged in a years-long campaign to block Fubo, resulting in significant harm to both Fubo and consumers.”Date of those claims in front On February 7, Trio's own unnamed, unpriced sports-focused service was suddenly announced, which the new lawsuit alleges “stealed Fubo's strategy.”
Hey, if you can't beat them…
Fubo's lawsuit further states that the defendants “used their iron grip over sports content to extract billions of dollars from their ultra-competitive interests.” In particular, Disney and Warner Bros. Discovery, with their highly engaging sports content, have been able to force distribution companies to offer an array of channels, including ones that many customers don't want. . Hubo said the practice has caused “billions of dollars in damages” and that the joint venture is “simply the latest coordinated step to eliminate competition in a sports-first streaming market.” Stated.
Okay, so Fubo is not a fan. The OG sports streamer was more insulting than most, but he wasn't the only one to denigrate the joint venture early on. America's two major sports leagues, the NFL and NBA, were both surprised by the Disney/Fox/WBD announcement. Powerful, multibillion-dollar sports leagues aren't used to being caught off guard by broadcast partners.
For now, each league is monitoring all developments. MVPD (Multichannel Video Programming Distributor) and v(virtual)MVPD will do something similar. They already have to pay for channels that no one watches (WBD's Science, Disney's Freeform) for the privilege of paying more for channels that their customers actually watch. Thinking wisely. I want it (WBD's Food Network, Disney's ESPN). Providers of traditional terrestrial TV packages like Comcast and Charter's Spectrum, or streaming equivalents like Hulu + Live TV and YouTube TV, are probably pretty upset about this joint venture.
Representatives for Comcast, Charter, Hulu + Live TV, and YouTube TV did not immediately respond to IndieWire's requests for comment. Anything; put them all on the list.
(Hulu is now wholly owned by Disney, which puts it in a particularly contradictory position. Hulu is also, in some ways, the model here. Hulu started out as a joint venture between Disney, Fox, and NBC. Well, that's fine. went!)
Fox President Lachlan Murdoch and Disney CEO Bob Iger have each said their company's new sports service will be code-never, meaning a traditional linear bundle in the US that has never had a traditional linear bundle to begin with. I purposely swore that I was targeting people. (WBD's David Zaslav will be on the company's earnings call on February 23rd.) It's an argument that doesn't follow any logic — Code Bar's decision to pay for sports in the first place (Code's ) I had no interest in it at all.
As proposed, new services, if priced competitively, will accelerate the rate at which Americans move away from the traditional cable ecosystem. Wells Fargo analyst Stephen Cahall estimates that the new joint venture will accelerate the already dire pace of code reduction by 2 percent annually through at least 2027. Make your dollar box before you run out of usable flank steaks. The cow was dead anyway.
Disney and Fox did not immediately respond to IndieWire's requests for comment for this story. Warner Bros. Discovery declined to comment.
It looks like at least some of the plans will change. Carriage negotiations between channel providers and channel distributors are becoming increasingly contentious. Disney learned that firsthand through Charter. What saved the deal was Disney+, which Charter wanted to offer free to cable customers. Some consumers will understand exactly that. Otherwise, wholesale pricing for Disney+ and ESPN+ will apply.
ESPN is another Disney brand in strange territory. The popular cable channel has already been overshadowed by its owner's streaming dreams. ESPN+ is both a complement and a competitor to ESPN. Plus, in 2025, Disney (yet!) new Direct-to-consumer ESPN app.
Disney Chief Financial Officer Hugh Johnson said in a recent appearance on CNBC that the joint venture will be responsible for “more than 80 percent of the domestic games that are currently aired.” If I didn't know better, I'd say that sounds a bit like a monopoly. (To be fair, Johnson said both companies will negotiate with the league as individuals over sports rights; the joint venture is for distribution purposes only.)
Who isn't dissatisfied with monopoly? In 2018, the Department of Justice withdrew Fox Regional Sports Networks (RSN) from Disney's acquisition of the majority of Fox assets. At the time, the Department of Justice cited competition issues, and yes, they would like to consider this issue.
It's already planned. Bloomberg first reported that the Justice Department “will review the terms of the joint venture once they are finalized.” Disney, Fox and Warner Bros. Discovery were not notified of such reviews, they wrote.
The Department of Justice did not immediately respond to IndieWire's request for comment on this story.
