FuboTV, a streaming service with a focus on sports, has initiated an antitrust lawsuit against Walt Disney, Fox, and Warner Bros Discovery concerning their proposed sports streaming platform. FuboTV alleges that the collaboration’s launch, integrating a wide range of professional and collegiate sports rights from the media companies, will eliminate competition in the direct-to-consumer streaming sports apps market. FuboTV further contends that this joint venture will impose exorbitant and unjust prices on consumers. The legal action was announced by FuboTV on Tuesday.
The lawsuit was filed in the U.S. District Court for the Southern District of New York, naming Disney, Fox, and Warner Bros Discovery as defendants. It seeks to enjoin the joint venture or require restrictions for it to proceed, such as economic parity of licensing terms. It also seeks “substantial damages” from the Defendants.
Fubo, founded nine years ago to offer a sports-centric package of live TV streaming channels, says the vertically integrated media companies have engaged in a long-running campaign that has hindered competition in the U.S. streaming industry and caused harm to FuboTV and its customers. The three companies’ plan to offer a combined sports streaming app is the latest in that campaign, Fubo alleged.
Specifically, Fubo alleges that the Defendants have used unfair tactics to prevent Fubo from competing fairly in the marketplace, including through unlawful “bundling” — forcing Fubo to carry dozens of expensive non-sports channels that its customers do not want as a condition of being able to license the Defendants’ sports content. In addition, the Defendants have charged Fubo content licensing rates up to 50% or higher than they charge other distributors and imposed non-market penetration requirements, which have increased Fubo’s costs that it must pass on to its customers.
Disney, Fox, and Warner Bros Discovery announced in February that they would form a partnership to create a new sports streaming service this autumn. The unified platform will include their existing channels and be offered as an add-on to Hulu, ESPN+, and other streaming services. The companies are expected to charge around $50 monthly for the service, competing with other sports-focused streaming services such as Fubo and YouTube TV. The announcement sparked concerns that the joint venture could trigger a review by the Department of Justice to determine whether it violates antitrust laws. Last week, a report from The Verge noted that it’s risky for the companies to team up now, given all of the antitrust activity in the industry.