Fubo Sues Fox, Warner Bros, Disney Over Sports Streaming
Fox Corp., Warner Bros Discovery Inc. and Walt Disney Co. were sued by FuboTV Inc. over a proposed sports streaming service, saying the companies wouldn’t allow their smaller rival to carry just a bundle of sports channels.
The lawsuit seeks to block a joint venture for the service, saying the three companies are using their power to hinder Fubo’s business, the company said in a statement.
Disney, Fox and Warner Bros. have “consistently engaged in anticompetitive practices that aim to monopolize the market,” Fubo Chief Executive Officer David Gandler said. “Simply put, this sports cartel blocked our playbook for many years and now they are effectively stealing it for themselves.”
The Justice Department already plans to scrutinize the new product over concerns it will harm consumers, media rivals and sports leagues, Bloomberg News reported last week, citing two people familiar with the process. Regulators will look at terms of the joint venture once it is finalized, the people said.
ESPN and Fox declined to immediately comment while officials at Warner Bros Discovery couldn’t be immediately reached. The Wall Street Journal reported on the lawsuit earlier Tuesday.
Fubo said the companies charge it licensing rates as much as 30% to 50% higher than other distributors like Disney’s Hulu and Alphabet Inc.’s YouTube since those firms receive rebates that effectively lower their rate, according to the complaint. The companies have also hiked the prices they charge for content, forcing Fubo to raise its prices from $35 per month in 2017 to $79.99 today, the complaint said.
Video-on-Demand
The companies have declined to allow Fubo to offer some features — such as video-on-demand and recording — things that Disney CEO Bob Iger has said will be available in its new ESPN+ package.
The streaming service, announced earlier this month, would combine content from Disney’s ESPN and ABC networks, Fox, and Warner channels including TNT and TBS. Citi analysts estimated the venture would control about 55% of US sports rights.
The companies’ say they aim to attract viewers who don’t subscribe to a pay-television bundle and offer sports programming available on traditional cable packages.
The case is FuboTV Inc. v Walt Disney Co. et al, 24-mc-70, US District Court, Southern District of New York.
(Updates with additional details beginning in sixth paragraph.)