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FuboTV, a live TV streaming platform, has filed a civil lawsuit against Disney, Fox and Warner Bros. Discovery, alleging that the media companies have engaged in anti-competitive practices for years and continue to do so through the combined application of sports broadcast that intends to launch later this year, according to court documents.
The lawsuit, filed in federal court in the Southern District of New York, also names ESPN and Hulu as defendants.
In the lawsuit, FuboTV, which has been in business since 2015, alleges that the companies have engaged in a campaign that has resulted in the suppression of competition in the US sports-focused streaming market, causing harm to FuboTV and its customers are now the companies’ latest joint alliance. The company will continue to suppress competition. Disney, Fox and Warner Bros. Discovery announced this month that they would collaborate to launch a direct-to-consumer streaming app that would allow customers to pay for access to all the sports they broadcast on a combined 14 linear channels.
“Instead of competing, Defendants have chosen to collude, giving their own cartel, and no one else, the ability to market and sell a package focused on live sports,” FuboTV alleges in the lawsuit. “In this way they have ensured that their combined entity will not face effective competition. “Now they are harming, and threatening to do more harm, to U.S. competition and consumers.”
FuboTV says the companies forced it to accept bundling requirements in order to stream certain content and imposed above-market licensing fees, which has led to higher prices for consumers. The companies’ behavior, FuboTV said in the lawsuit, was a way to hinder Fubo’s business and growth.
By forming the joint venture, Fox, Disney and Warner Bros. Discovery will effect a “freeze” on streaming competitors and incentivize them not to offer premium content to Fubo and others, FuboTV alleges in the lawsuit.
Fubo is asking the court for a permanent injunction to prevent the joint venture from operating and to order the three companies to unwind it.
“For decades, defendants have leveraged their tight control over sports content to extract billions of dollars in supracompetitive profits from distributors and consumers,” the complaint says. “The defendants made many of these profits” by bundling “their commercially critical sports content with other less desirable content, forcing sports fans to purchase channels they did not want or need to receive the defendants’ sports content.”
The joint venture between the three companies revolutionized the sports television ecosystem when it was announced. Between them, Disney, Fox and Warner Bros. Discovery own the rights to national broadcasts of the NBA and NHL, along with a good number of NFL, MLB and NCAA tournament games, among other sports. FuboTV alleges that the companies are violating antitrust laws by combining into one streaming app.
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“The (joint venture) will substantially lessen and soften competition by facilitating horizontal collusion among the defendants, who collectively control access to most commercially critical sports content in the United States,” the lawsuit says. “With the joint venture, the defendants have aligned their interests and will have the opportunity and incentive to collude when it comes to licensing must-see sports content to third-party distributors.
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(Photo: Jakub Porzycki/Getty Images)