Sen. Elizabeth Warren once again criticized Disney’s dominance of the sports streaming marketplace on Wednesday, this time urging the Department of Justice to “closely scrutinize” their acquisition of Fubo.
More than a month after Disney announced it was combining Hulu + Live TV with FuboTV — thus ending the latter’s antitrust litigation with Disney, Fox and Warner Bros. Discovery — the Massachusetts politician still has “significant concerns” about the anticompetitive nature of the deal.
“Disney’s proposed acquisition of Fubo appears to allow Disney to simultaneously circumvent the lawsuit while gobbling up a competitor. This proposed acquisition raises significant concerns under antitrust law, would give Disney increased market power and incentives to increase costs for viewers, and should be regarded as another data point in Disney’s history of anticompetitive behavior,” she wrote in a Wednesday letter. “I urge DoJ not to be fooled by Disney’s attempt to purchase its way around antitrust law, and to closely scrutinize this proposed acquisition.”
Indeed, on Jan. 6, Disney announced it would own 70% of Fubo under the proposed acquisition, while keeping both companies’ existing management teams in place. They also revealed plans to work on yet another new streaming service together — separate from Venu or Flagship, as the upcoming ESPN offering is called internally.
“Disney’s acquisition of Fubo also threatens to eliminate substantial competition between current competitors, which could suggest the merger may substantially lessen competition,” Warren’s letter continued. “Even if Fubo and Hulu + Live TV are offered as separate services (as the initial plan suggests), their common ownership virtually eliminates any possibility of true competition.”
Venu Sports was supposed to launch at $42.99 per month last fall, but Fubo’s preliminary injunction blocked that from happening. The streamer would’ve featured programming from 15 sports channels across all the major sports leagues and top college conferences.
“Disney is already one of the most powerful media companies in the world. Threatened by Fubo’s lawsuit and in an apparent attempt to keep Fubo from ‘becoming the next Netflix,’ Disney has proposed a plan to acquire its competitor, and, in the process become an even more powerful force in an already highly-concentrated market,” Warren concluded. “DoJ powerfully pushed back on the attempt by Disney, together with Warner Bros. and Fox, to dominate the sports streaming market through Venu Sports. I urge DoJ to continue this work on behalf of viewers by closely scrutinizing this proposed deal and blocking it if it violates antitrust law.”
Warren, Bernie Sanders, Joaquin Castro and Jerry Nadler had previously expressed their concerns over Disney, Fox and WBD’s anticompetitive business model in an open letter to the FCC back in August.
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