FuboTV (FUBO) is filing a lawsuit seeking to block a sports streaming joint venture between Disney's ESPN (DIS), Warner Bros. Discovery (WBD), and Fox (FOX, FOXA). Fubo argues the partners' plan to offer a bundled sports streaming package encourages illegal market manipulation and undercutting its competitors.
Yahoo Finance's Alexandra Canal breaks down the details.
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Editor's note: This article was written by Angel Smith
Video Transcript
ALEXANDRA CANAL: And today, we're going to kick things off with Fubo, throwing a wrench into the sports streaming service being created by ESPN, Warner Brothers Discovery, and Fox. Now, FuboTV is filing a lawsuit against the joint venture, claiming it will put a stop to its plans to offer a small bundle of sports channels and make the business more expensive.
Now Fubo is a sports-first streaming platform. So they are saying that this new joint venture essentially steals their idea. If you take a look at the stock price, it's down about 20% since this deal was first announced. Fubo is also saying in that lawsuit that they have been charged above market prices, and that the creation of this service is going to disincentivize a lot of these companies from offering their products to someone like Fubo, because you would think they just want to keep that close to the joint venture.
But this is just an example I think of more pressure that's going to be on these companies and more turmoil that's going to come from these new joint ventures, from these companies coming together when you think about antitrust.
JOSH SCHAFER: Yeah. I think to me one of the main takeaways here is just when you see these headlines and business news and people get excited or maybe not excited, but start taking in the new product that we're going to be getting, you have to remember that the product isn't necessarily set in stone yet. And the fact that--
ALEXANDRA CANAL: There's a lot of question marks.
JOSH SCHAFER: This could potentially still not happen. It is not something that is confirmed happening on a confirmed date. There are a lot of hoops to get through here. And I think this is maybe that first reminder for just the general audience, the streamers themselves that might have been potentially waiting for this product to come out or wondering when this product would come out, is there are large questions here that do need to be answered before we see this true sports bundle sort of come together.
pras subramanian: Yeah. You know, in that complaint, Fubo is talking about how they were being forced to air other content in order to get to the good sports content. So that's interesting, kind of like twisting their arm. You know, the big question here is also, if it's going to be an FTC antitrust, is it-- is this thing bad for consumers, right? Is it-- is it going to harm them by higher prices, less selection, less sports content? And was the FTC even planning to sue anyway?
We'll see. But I mean, Fubo is kind of jumping the gun here and saying, we need to do this-- we got to stop this now. So maybe that's part of the--
ALEXANDRA CANAL: Yeah. And for consumers pricing, it's going to be a big point. There were reports that this service could cost $40 or more potentially. And you think about the value add, you think about what people pay now in order to access sports, probably a fair price point. But you don't know. People don't-- we don't know yet exactly how consumers are going to respond to this type of service and the amount of money that they're going to be willing to pay.
JOSH SCHAFER: I pay the 40 bucks, I've said it.
ALEXANDRA CANAL: I know you would.
JOSH SCHAFER: I'd pay the 40 bucks.
pras subramanian: So do you think that Fubo jumped the gun here? Should they have waited to see what the actual product is? Or--
ALEXANDRA CANAL: Well, there is a lot of question marks, right? I mean, even when it comes to sports rights, are these companies going to bid together now? Is it still going to be separate? Again, pricing, a big question mark. But I think Fubo is looking at their stock price, they're looking at their whole business strategy. And they're a small fish in this really big pond. And there's a lot of competitors out there. So we're just going to see more of this, I'm predicting.
