The three entertainment companies had sought to create a new streaming service called Venu Sports that would launch this fall and charge $42.99 a month for access to networks across their portfolios, including ESPN, Fox Sports and TNT. Bundling sports content from the 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 also raised alarm bells among lawmakers including Sen. Elizabeth Warren (D-Mass.), Sen. Bernie Sanders (I-Vt.) and Rep. Joaquin Castro (D-Texas), who recently called on federal authorities to investigate. They warned that the joint venture could put the companies “in a position to exert monopoly power over televised sports” and force competitors to negotiate with the joint venture companies “for access to more than half of the major sports licensing rights while simultaneously competing against these companies to offer the best product to broadcast or stream these programs.”
Southern District of New York Judge Margaret Garnett said Fubo would likely succeed in arguing that the deal violates the Clayton Act, which regulates mergers and acquisitions, and granted a preliminary injunction blocking it.
“Simply put, the antitrust problem presented by the joint venture is this: If the joint venture is allowed to launch, it will be the only option in the market for those television consumers who want to spend their money on multiple live sports channels that they love to watch, but not on superfluous entertainment channels that they don’t like,” Garnett wrote. “And the corporate owners of the joint venture (the joint venture defendants) are the same actors who (1) used their long-standing bundling practices to create the void in the pay-TV market tailored for the live sports-only joint venture to fill, and also (2) exert near-monopoly control over the ability for a different live sports-only streaming service to exist and compete with the joint venture.”
David Gandler, Fubo’s co-founder and CEO, called the decision a win 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 said from the beginning that we seek equal treatment from these media giants and a level playing field in our industry. The proposed joint venture was just the latest example of 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 deceive consumers from being able to choose what they deserve.”
Venu Sports did not immediately respond to requests for comment.
