Last year, Disney was hit with an antitrust lawsuit by a group of YouTube TV subscribers from four different states, who claim that the business deals it has done with live TV service providers have inflated the amount consumers have to pay.  There is also another group of DirecTV subscribers fighting the same problem.

Disney requires live TV platforms like YouTube TV to include ESPN in their base package, meaning that customers have to pay much more, even if they don’t want to watch ESPN.   The lawsuit alleges that Disney uses ESPN and Hulu to set a price floor in the SLPTV Market and inflates prices marketwide by raising the prices of its own products. And this is precisely what Disney has done in the past three years, since it took operational control of Hulu.

The plaintiff’s lawyers have said that “many consumers would prefer a base package that does not include ESPN and costs meaningfully less.”

This past Tuesday, Disney’s lawyers asked earlier in the week for a U.S. judge to dismiss these consumer antitrust cases.  In a court filing, Disney’s attorneys have argued that the nine plaintiffs have” misconstrue basic antitrust and economic concepts.”  And that the plaintiffs failed to show “a relevant antitrust market in which competition was harmed.” They also contend “the antitrust laws exist to protect competition, not individuals.”

One of the biggest reasons why cord-cutting has become so popular, especially in the United States, is that streaming services offer more choices and are generally much cheaper.  However, it became very apparent the additional costs of ESPN and Disney channels were drastically increasing the price of live TV streaming bundles when Disney and YouTube TV got into a carriage dispute, which saw Disney’s channels temporarily become unavailable, and YouTube TV issued a statement saying that if they couldn’t get a new deal, the Disney-owned channels would be removed and customers would receive a price cut from US$64.99 to US$49.99.   The deal was worked out, with YouTube TV staying at $65.99.  This $ 15-a-month difference is what looks to have been the catalyst for this lawsuit.

Should this lawsuit go through, it could have significant issues for Disney and other platforms.  Especially as forcing ESPN to be included in bundles like YouTube TV and DirectTV, drastically benefits Disney’s income.

Do you think Disney should offer Live TV without ESPN included?  Let us 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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