A federal judge has temporarily blocked the launch of Ven
u Sports, a highly anticipated sports streaming service created through a joint venture involving Warner Bros. Discovery, Disney, and Fox Corporation. This ruling represents a significant setback for the collaboration, which was set to debut just weeks before the NFL season begins.
The decision came after Fubo, a smaller competitor in the sports streaming market, requested a preliminary injunction against Venu Sports. The court found merit in Fubo's claims, suggesting that the joint venture could substantially reduce competition and restrain trade within the relevant market. U.S. District Judge Margaret Garnett stated in her preliminary injunction order that Fubo is likely to succeed in its legal claims against the media giants.
Fubo filed its lawsuit in February, asserting that the three major companies were attempting to leverage their extensive sports media rights to monopolize the market. The company argued that this move would create an anticompetitive environment, effectively cornering the market with a single, bundled service.
In response to the ruling, Disney, Fox, and WBD issued a joint statement expressing their intention to appeal. They firmly disagreed with the court's decision, arguing that Fubo's claims are unfounded. The companies emphasized that Venu Sports is intended to be a pro-competitive option that enhances consumer choice by catering to viewers who are currently underserved by existing subscription services.
Venu Sports was expected to offer a wide array of sporting events for $42.99 per month, drawing from the extensive portfolios of the involved media companies. This included access to major leagues such as the NFL, NBA, MLB, NHL, as well as events in tennis, soccer, golf, NASCAR, and UFC. Following the news of the injunction, Fubo’s stock saw a notable increase of over 17%.
Fubo's co-founder and CEO, David Gandler, celebrated the ruling as a victory for consumers, asserting that it would help foster a more competitive marketplace with diverse streaming options. The timeline for a court date regarding the antitrust lawsuit remains uncertain.
Legacy media companies have been striving to adapt to the changing landscape as more consumers abandon traditional cable subscriptions. This shift has been accelerated by the rise of streaming services like Netflix. Major players in the industry, including Disney's Bob Iger and WBD's David Zaslav, have indicated that they plan to focus on bundling offers to simplify choices for subscribers and retain their audience.
When the Venu partnership was first announced in February, both Iger and Zaslav hailed it as a significant advancement for the media industry. Lachlan Murdoch, CEO of Fox Corp., expressed confidence that the service would provide fans outside the traditional cable bundle with a wealth of sports content.
While WBD has integrated its live sports offerings into its Max streaming service, Disney is also preparing to launch a standalone ESPN streaming service next year. A source familiar with Disney's strategy noted that Venu was just one part of a broader plan, emphasizing that ESPN has numerous distributors and a flagship service on the way, indicating potential for further innovative bundles in the evolving media landscape.
