Fubo Challenges Disney, Fox, and Warner Bros. Discovery in Court Over Sports Joint Venture, Alleging Anticompetitive Practices
Fubo, a sports-centered online TV subscription service, is taking legal action against Disney, Fox Corporation, and Warner Bros. Discovery, accusing them of planning to introduce a competitive sports streaming package.
The legal action, lodged recently in the Southern District of New York, claims that Disney, Fox, Warner Bros. Discovery, along with Disney’s ESPN and Hulu, have been “engaged in a years-long campaign to block Fubo’s innovative sports-first streaming business resulting in significant harm to both Fubo and consumers.” The lawsuit contends that the defendants’ planned sports streaming service, set for a debut in fall 2024, is a direct copy of Fubo’s model and infringes upon antitrust regulations.
Fubo’s legal filing seeks an injunction against the defendants’ joint venture or the imposition of specific conditions, such as “economic parity of licensing terms”, to allow the venture to proceed. Additionally, Fubo is pursuing “substantial” financial compensation, though the exact figure is not disclosed in the filing.
Fubo criticizes the defendants for exploiting their dominant position in sports broadcasting to secure “billions of dollars in supra-competitive profits” by enforcing high costs for premium sports programming, adversely affecting both the company and its clientele.
The lawsuit further alleges that Disney, Fox, and Warner Bros. Discovery have systematically engaged in unfair practices to thwart Fubo’s competitive edge. This includes mandatory “bundling” of unwanted non-sport channels with their sports offerings and charging Fubo inflated licensing fees—at least 50% higher than those offered to other distributors. The complaint also mentions the imposition of unreasonable market penetration thresholds that Fubo must adhere to.
Moreover, Fubo accuses the trio of barring it from introducing “compelling” streaming options that would appeal to consumers, freedom enjoyed by other traditional and streaming television services, including Disney’s Hulu platform.
Fubo’s lawsuit claims these actions by Disney, Fox, and Warner Bros. Discovery breach several U.S. antitrust laws, specifically mentioning the Sherman Act’s Section 1, the Clayton Act’s Section 7, and the New York Donnelly Act.
David Gandler, Fubo’s co-founder and CEO, condemned these practices in a statement, asserting, “Each of these companies has consistently engaged in anti-competitive practices that aim to monopolize the market, stifle any form of competition, create higher pricing for subscribers and cheat consumers from deserved choice.”
Gandler also stated, “By joining together to exclusively reserve the rights to distribute a specialized live sports package, we believe these corporations are erecting insurmountable barriers that will effectively block any new competitors from entering the market. This strategy ensures that consumers desiring a dedicated sports channel lineup are left with no alternative but to subscribe to the Defendants’ joint venture.”
In a related development, it was reported last week that the Justice Department is set to scrutinize the Disney/Fox/Warner Bros. Discovery sports streaming venture for potential adverse effects on consumers, citing unnamed sources.
Ragul Thangavel
With over nine years of diverse professional experience, Ragul has made significant contributions across various domains, including Media Operations, OTT Technologies, Video Production, Ecommerce, and Social Media.
Holding an Engineering degree, Ragul's career took an unconventional turn when he discovered his passion for writing, leading him to begin his journey as a content writer.
His career has been exclusively dedicated to the growth and development of startups, where he has played a pivotal role. His unique blend of technical knowledge and creative prowess has enabled him to drive innovation and success in every venture he has been a part of.
