Anika Begay
The three entertainment companies had been trying to create a new streaming service called Venu Sports that would launch this fall and charge $42.99 a month for access to the networks in their portfolios, including ESPN, Fox Sports and TNT. Bundling sports content from all three companies would put other distributors like Fubo at “an extreme competitive disadvantage,” Fubo said at the time. DirecTV and Dish sided with Fubo in the case.
The deal has also raised alarm bells for lawmakers including Sen. Elizabeth Warren (D-MA), Sen. Bernie Sanders (I-VT), and Rep. Joaquin Castro (D-TX), who recently called for federal authorities to investigate. They warned that the joint venture (JV) could put the companies “in a position to exercise monopoly power over televised sports” and effectively require competitors to negotiate with the JV companies “for access to more than half of the major sports licensing rights, while simultaneously competing with those companies to offer the best product to broadcast or stream those programs.”
Southern District of New York Judge Margaret Garnett said Fubo would likely succeed on the merits in arguing that the deal violates the Clayton Act, which governs mergers and acquisitions, and granted a preliminary injunction to block it.
“Simply put, the antitrust problem presented by the JV is this: If the JV is allowed to depart, it will be the only option in the marketplace for those television consumers who want to spend their money on more live sports channels that they love to watch, but not on superfluous entertainment channels that they don’t,” Garnett wrote. “And the JV’s corporate owners, the JV Defendants, are the same actors who (1) used their longstanding bundling practices to create the void in the pay TV market tailored for the JV to fill only for live sports and also (2) exercise near-monopolistic control over the ability of a different live sports-only streaming service to exist and compete with the JV.”
Fubo co-founder and CEO David Gandler called the decision a victory for both Fubo and consumers. “This decision will help ensure that consumers have access to a more competitive marketplace with multiple sports streaming options,” he said in a statement. “But our fight continues. Fubo has always said that we seek fair treatment from these media giants and a level playing field in our industry. The proposed joint venture was just the latest example of the anti-competitive practices that The Walt Disney Company, FOX Corp. and Warner Bros. Discovery have consistently engaged in for many years. We believe these practices monopolize the market, stifle competition and deprive consumers of the choice they deserve.”
Venu Sports did not immediately respond to requests for comment.
