Just weeks before the start of the NFL season, a judge temporarily blocked the launch of Venu Sports, an upcoming sports streaming service from Disney’s ESPN (DIS), Warner Bros. Discovery (WBD) and Fox (FOXA), citing antitrust concerns.
The preliminary injunction comes after sports streamer FuboTV (FUBO) filed a lawsuit in February against the media giant behind the joint venture, seeking to block the service for “extremely stifling competition in the U.S. sports-centric streaming market.”
Shares of Fubo, which boasts more than 200 channels and 1.5 million North American subscribers, rose as much as 22% following the news on Friday. Shares of Disney, Fox and WBD were little changed after the announcement.
In her ruling on Friday, U.S. District Judge Margaret Garnett found that the creation of the joint venture would “substantially lessen competition and restrain trade.” She further said the joint venture would ensure “the immediate departure of many of Fubo’s subscribers” and that “Fubo’s bankruptcy and delisting of its shares will likely follow soon, which is a classic example of harm that money cannot adequately repair.”
Fubo co-founder and CEO David Gandler called the ruling “a win not only for Fubo but also for consumers,” saying, “This decision will help ensure consumers have access to a more competitive marketplace with multiple sports streaming options.”
Disney, WBD and Fox responded to the injunction in a joint statement, saying, “We respectfully disagree with the Court’s decision and will appeal.”
“We believe Fubo’s arguments are flawed on the facts and the law, and that Fubo has failed to demonstrate that it is legally entitled to a preliminary injunction. Venu Sports is a pro-competitive option designed to increase consumer choice by reaching audiences underserved by existing subscription options.”
Disney, WBD and Fox first announced the joint venture in February, teasing a debut this fall. The service, which would combine the sports rights of each company, comes as media companies face growing pressure from investors to scale and monetize their streaming services.
In March, Fox CEO Lachlan Murdoch dismissed Fubo’s lawsuit, saying the company had no regulatory concerns about the service.
“When you look at this service, it’s pro-consumer and pro-competitive,” he said at the time. “It’s focused on a specific segment of the population.” [that’s] There is no sports content offered at all.”
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Earlier this month, the companies announced a monthly fee of $42.99 for Venu. Executives also reiterated their expectation that the service will reach about 5 million subscribers by 2029, citing the opportunity to attract “cord cutters” and “cord nevers.”
Alexandra Canal is a senior reporter at Yahoo Finance. Follow her at Yahoo Finance. Translatorvisit me on LinkedIn or email me at alexandra.canal@yahoofinance.com.
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