Sports streaming platform FuboTV has filed a lawsuit against Disney, Fox, and Warner Bros. Discovery, alleging that their recently announced joint venture represents an “extreme suppression of competition in the U.S. sports-focused streaming market,” according to a copy of the legal complaint.
The joint venture, which was revealed earlier this month, aims to offer a novel way for viewers to access premium live sports. It is scheduled to launch this fall, although details regarding its pricing and structure are still unclear.
The lawsuit accuses these major competitors of colluding to form a joint venture that will significantly harm competition and consumers. It also includes Disney-owned ESPN and Hulu as defendants.
FuboTV CEO David Gandler criticized the companies in a statement, claiming that they have engaged in anticompetitive practices intended to monopolize the market, suppress competition, drive up subscriber prices, and limit consumer choice.
“By joining forces to exclusively reserve the rights to distribute a specialized live sports package, we believe these corporations are creating insurmountable barriers that will effectively prevent new competitors from entering the market,” Gandler said.
FuboTV contends that Disney, Fox, and Warner Bros. Discovery, which control a substantial share of live sports content in the U.S., have imposed bundling requirements and “significantly above-market licensing fees” on them, resulting in inflated prices for consumers.
The lawsuit claims that the new joint venture will allow these media companies to undercut these prices and bypass restrictions on the channels they must include, giving them an unfair competitive advantage.
Recently, the joint venture has raised concerns within the traditional pay-TV industry. Leaders of major distributors have privately expressed worries that the new “skinny bundle” could lead to increased cancellations of cable TV subscriptions.
Analyst Craig Moffett of MoffettNathanson noted that antitrust challenges are likely in response to the joint venture.
