Earlier this week, Disney made a shock announcement that it was going to combine its Hulu + Live TV business with Fubo, which will see Disney own 70% of Fubo. Fubo’s existing management team, led by Fubo Co-founder and CEO David Gandler, will operate the newly combined Fubo and Hulu + Live TV businesses.

As part of this new agreement, the combination of Fubo and Hulu + Live TV, will have over 6.2 million subscribers in North America — will facilitate an enhanced choice of programming packages and address a variety of consumer preferences at attractive price points.

Prior to the deal, Fubo TV was able to get a temporary injunction to pause the launch of “Venu Sports”, which is a new sports streaming service that will combine all of the sports content from ESPN, FOX and Warner Bros. Discovery. As part of this new deal between the two, Fubo has settled all litigation with Disney, FOX and Warner Bros. Discovery. 

However, the future of Venu Sports still isn’t looking positive, as some of the other competitors in the market, DirecTV and Dish, have written to U.S. District Judge Garnett to look over the dismissal of Fubo’s lawsuit, with now DirecTV and EchoStar now looking to get the launch of Venu Sports blocked.  With DirecTV stating via THR:

“Through the settlement and acquisition, the defendants have purchased their way out of their antitrust violation.  This settlement clears the path for Venu to launch unencumbered by removing the injunction the court imposed to preliminarily prevent the immediate and irreparable harms the JV launch presents. DirecTV is just one of several non-parties that expressed ‘grave concerns’ about the impact Venu would have on competition for sports programming,”

EchoStar also wrote:

“Now, with the injunction undone by voluntary dismissal, DISH, Sling and other distributors will suffer antitrust injury. Their services will be hampered by the massive incentive that the JV defendants have to raise programming fees for distributors that compete against Venu, and they will be effectively foreclosed from competing,”

We are likely going to see more consolidation between different streaming services and cable networks in the coming years ahead, as the industry deals with the impact of cord-cutting. 

As part of the deal between Disney and Fubo, a termination fee of $130 million will be payable to Fubo under certain circumstances, including if the Transaction fails to close due to the failure to obtain requisite regulatory approvals on the terms and conditions set forth in the definitive agreement.

Roger’s Take:  It’s not surprising to see the other streaming networks trying to come together to block the launch of Venu Sports since it’s likely going to be a major disruptor within the industry as audiences will flock to a service that only offers them the sports content they desire, without all the other bundled channels, which is why cable prices have always been so expensive.

The combination of Fubo and Hulu + Live TV is probably less likely to cause as much of a legal issue since, even when combined, they will still be smaller than YouTube TV.  Plus, the combined offering won’t be much different than anything on the market.  Whereas the creation of Venu Sports is worrying the other cable television providers, as they know that live sports is the only thing keeping more subscribers.  Eventually, most sports coverage is going to be heading to streaming services, so it feels like a bandaid to slow the losses rather than an actual fix to the problem.  

If there is another lawsuit to block the launch of Venu Sports, I do wonder if Disney, Warner Brothers Discovery and Fox, might just give up on the plan and offer a slimmed-down sports bundle to all providers, while Disney also merges Hulu + Live TV in with Fubo TV, to help shift the loss-making platform away from its direct-to-consumer business.

Do you think Venu Sports will still launch?  Let me know on social media!

Roger Palmer

Roger has been a Disney fan since he was a kid and this interest has grown over the years. He has visited Disney Parks around the globe and has a vast collection of Disney movies and collectibles. He is the owner of What's On Disney Plus & DisKingdom. Email: Roger@WhatsOnDisneyPlus.com Twitter: Twitter.com/RogPalmerUK Facebook: Facebook.com/rogpalmeruk

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