Fubo TV has filed a suit against Disney, Fox Corp. and Warner Bros. Discovery. The lawsuit which is based out of the Southern District of New York aims to stop the proposed joint venture that would combine major sports properties into one stand-alone service. In the suit Fubo even made the point that they had tried to offer a sports only service but had been prevented from doing so by ESPN.
“Each of these companies has consistently engaged in anti-competitive practices that aim to monopolize the market, stifle any form of competition, create higher pricing for subscribers and cheat consumers from deserved choice. By joining together to exclusively reserve the rights to distribute a specialized live sports package, we believe these corporations are erecting insurmountable barriers that will effectively block any new competitors from entering the market,” Said Fubo CEO David Gandler. “This strategy ensures that consumers desiring a dedicated sports channel lineup are left with no alternative but to subscribe to the Defendants’ joint venture.”
“We have previously collaborated with each of these companies so that we could offer ‘must-have’ sports content to Fubo customers. For many years, they have challenged our business at every opportunity through pernicious practices. While other new competitors were prevented from entering the market, Fubo has continuously fought back. The Defendants’ unconscionable practices have impacted our ability to grow and have deprived consumers of a compelling and competitively-priced product.
“Simply put, this sports cartel blocked our playbook for many years and now they are effectively stealing it for themselves.”
What makes this case unique is that Fubo operates like a traditional TV provider, different from Cable services only in average price and interface. The actions sound like the typical practices of the TV industry that caused the bloated TV lineup and regular price increases that have driven a wedge between customers and providers and led to cord-cutting in the first place. A statement from Fubo says that “The Defendants have locked arms to remove further competition, according to Fubo’s complaint. Each Defendant is a media conglomerate that owns critical sports content and, according to the complaint, has individually engaged in anti-competitive behavior against Fubo resulting in harm to consumers.”
Together, the Defendants control more than half of the U.S. sports rights market. By combining to license their must-have sports content on a standalone basis to their own joint venture, other distributors, including Fubo, would be at an extreme competitive disadvantage to the detriment of millions of U.S. consumers, according to the complaint. The difference with this case is that the partners in the joint venture are openly working together to pull their programming into one place instead of competing separately to get the best deal for their content. By just agreeing to work together they bypass competition with each other which is why an anti-Trust case stands to be a good argument. One has to wonder if Fubo will be the only plaintiff in the case. The anti-competitive nature of the proposal could spur others to join the case. The defendants have yet to respond to the complaint as of this writing.
