Judge Garnett found that once Venu went live, FuboTV would face “a rapid exodus” of many subscribers.
A Manhattan federal court barred Disney, Fox, and Warner Bros. Discovery from launching the new joint sports streaming service Venu as a protective measure for the sports streaming service FuboTV.
According to the complaint filed by FuboTV, streaming backed by these big three would “substantially lessen competition and restrain trade.” Fubo launched in 2015 as a start-up focused on streaming sports programming.
“We respectfully disagree with the court’s ruling and are appealing it,” Disney, Fox, and Warner Bros. Discovery said in a statement. “We believe that Fubo’s arguments are wrong on the facts and the law and that Fubo has failed to demonstrate that it is legally entitled to injunctive relief.”
According to the companies, Venu Sports is a pro-competitive option that aims to enhance consumer choice by reaching a segment of viewers currently underserved by existing subscription options.
Venu, which was scheduled to launch in late August, before the start of the upcoming fall NFL season, and initially priced at $42.99 per month, was to offer the entire sports offering from ESPN, Fox Sports 1 and 2, and TNT for a price that is considered higher than a regional sports network, but lower than a full package of programming available through YouTube TV or Hulu + Live TV.
All three parent companies are targeting a new generation of consumers who disdain the high costs of traditional cable packages and are more comfortable subscribing to streaming channels, which are relatively easy to dip in and out of based on the availability of favorite entertainment programs or sporting events.
Judge Garnett found that once Venu went live, FuboTV would face “a rapid exodus” of many subscribers and indicated that she considered it “likely that Fubo’s bankruptcy and delisting of the company’s stock would soon follow. These are quintessential damages that money cannot adequately repair.”
Fubo alleged that the launch of Venu “will cause it to lose approximately 300,000 to 400,000 (or nearly 30%) of its subscribers, suffer a significant decline in its ability to attract new subscribers, lose between $75 million and $95 million in revenue, and be transformed into a penny stock awaiting delisting from the New York Stock Exchange, all before the end of 2024,” the judge said in her decision.
Disney, Fox, and Warner Bros. Discovery have been working in recent months to build out the technology and consumer experience for the site. However, the launch of Venu was still subject to regulatory approvals and the finalization of definitive agreements between the parties. The companies anticipate making the service available through an app but also expect to distribute it in packages that could include Disney+, Hulu, or Max.
