Two years ago, a group of YouTube TV subscribers came together to launch an antitrust class action against Disney over forcing price rises of its own products and setting a price floor following the company owning both Hulu and ESPN.  Though the court case referred to Hulu, this is leaning more toward the ownership of Hulu+Live TV rather than just the streaming platform.

Television providers in the United States, like YouTube TV and Sling TV, are required by Disney to also carry ESPN if they want to offer its other linear channels like FX, National Geographic, and Disney Channel.  Resulting in subscribers having to pay more than they should.

On Tuesday, the case came before US Judge Edward J. Dav, where Disney tried to get the case thrown out; however, the case will continue to run forward as the Judge feels that the company could’ve leveraged its purchase of Hulu to raise prices of live TV streamed over the internet across the market.  It’s also likely that Disney may have imposed anticompetitive terms on rivals, including AT&T’s DirectTV and Dish’s Sling TV, by forcing them to carry ESPN as part of the cheapest bundle they offer and instituting so-called most favoured nation clauses, which ensure that ESPN affiliate fees negotiated with any given competitor represent an industrywide price floor.

But the Judge did make a decision that the plaintiffs won’t be able to seek damages. However, there could still be a possibility of future injunctions that could stop Disney from engaging in such antitrust violations in the future.

“Because Plaintiffs have specifically alleged that the terms of the MFN provision permit Disney to set a price floor and raise its competitors’ ESPN prices (which translate to the subscription package prices) whenever it raises Hulu’s prices, the Court finds Plaintiffs’ allegations sufficient to plead Disney’s market power in a well-defined SLPTV market in the United States”

The order highlighted a huge shift in how audiences watch television over the past fifteen years and the launch of online television providers like YouTube TV. 

When Disney purchased 20th Century Fox in 2019, it also gained control of Hulu, which also included Hulu+Live TV.  Recently, Comcast activated a deal it made with Disney back in 2019, where Disney had to buy out Comcast’s 33% stake in Hulu, and that is also going through some legal hurdles as the two companies can’t come to an agreement on the valuation. However, a third party has been brought in to try to break the deadlock.

Disney is also locked in other legal battles with Fubo TV over the impending launch of “Venu Sports”, which will see Disney team up with Warner Brothers Discovery and Fox to launch a streaming service with its combined sports offering. 

Roger’s Take:   The days of cable television, where major studios could bundle together all their channels into one package and force customers to pay for them, regardless of if they want them, is over and they tried to do the same thing with the streaming TV business.   This situation is messy for Disney, as while the lawsuit might not cost them a huge amount in damages, there could be some major problems.  For years, I’ve felt that the future of Hulu+Live TV is murky, as there is little growth for new subscribers, and more people are moving away from cable-lite packages.   With Disney going all in on streaming, I could easily see Disney selling or closing down Hulu+Live TV eventually to streamline its focus on Disney+ and ESPN. 

What do you think is going to happen with Hulu+Live TV?  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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