This week Fubo managed to get a preliminary injunction to block the launch of the new Venu Sports streaming service. Whether blocking Venu Sports is the right move will depend on what you, as a consumer, thinks will cost you less in the long term.
That’s the idea anyway, and the argument being made by both sides. In reality, it is not Venu Sports itself that’s on trial here but what each side can argue is best for the consumer. If you ask Fubo, Venu Sports is anti-consumer. If you ask Disney, Fox and Warner Bros. Discovery, Venu Sports is pro-consumer.
Why Fubo Says Venu Sports Is Bad For Consumers
Immediately after the new sports-streaming service was announced, Fubo made its feelings clear. Soon after that, Fubo filed a lawsuit against the streaming service. More specifically, an antitrust lawsuit.
Fubo argues that Venu Sports is, by design, a monopoly, and like any good monopoly, that’s bad for consumers. There are two specific parts to this argument, so let’s start with the first.
Venu Sports will offer consumers a way to subscribe to a selection of sports channels without having to also pay for entertainment channels. Considering live TV services are not typically allowed to offer sports-only packages, this could put a lot of those live TV services at risk. After all, live sports continues to be a major driving force for why consumers subscribe to live TV services to begin with.
Fubo, in particular, is likely to be affected by the launch considering it is marketed as a sports-first live TV service, which explains why it has been so actively against the launch.
The second part of the argument is where things get murkier and where Fubo’s suggestion of a ‘sports cartel’ comes in. While having a cheaper sports-only service is hardly a bad thing for consumers, and many will see it as a great alternative to a live TV plan, Fubo argues Disney, Fox and Warner Bros. Discovery are the very reason a similar sports-only package doesn’t already exist.
The claim is that these three companies have worked together to intentionally ensure there is no competition for Venu Sports so that when the sports service launches it can corner the market. This claim is where the antitrust and monopoly accusations stem from.
Why Disney, Fox And Warner Bros. Discovery Say Venu Sports Is Good For Consumers
From the very beginning, Disney, Fox and Warner Bros. Discovery have argued that Venu Sports is good for consumers. The main crux of their argument is that Venu Sports offers an option that isn’t currently available, thereby filling a gap in the market.
The three companies argue that Venu Sports is designed to target those that have never signed up to a live TV package (cord-nevers) as well as those that no longer pay for a live TV package (cord-cutters).
As a live TV service is typically needed to access the channels many live sports events are broadcast on, these cord-nevers and cord-cutters are automatically excluded from watching live sports. As a result, the three companies argue Venu Sports fills in an important and unserved gap in the market, making it a pro-consumer solution.
In addition to serving these groups, Disney, Fox and Warner Bros. Discovery argue that Venu Sports won’t materially impact live TV subscribership in general. The suggestion here is that live TV subscribers won’t abandon their live TV plan in favor of the standalone streaming service.
So Was Blocking Venu Sports The Right Move?
Whether or not Venu Sports is good or bad for consumers is not why Venu Sports was blocked from launching. Instead, the court issued the block after deciding that Fubo’s argument had merit, and had the potential to prove successful at trial.
Presuming the two sides don’t suddenly come to an agreement, such as allowing Fubo and other live TV services to offer competing sports-only packages, this dispute will go to trial and the court will be expected make a firm decision on whether Venu Sports is pro or anti-consumer.
If the service had launched on schedule, and the court later found the sports service to be anti-consumer at trial, the argument can be made that the damage would have already be done, potentially putting live TV services at risk. It is this assumption, along with the court’s view of Fubo’s likelihood of success at trial, that ultimately led to the block.
Basically, it is a temporary measure designed to maintain the status quo until the dispute comes before a court.
Again, much of this dispute is being argued on behalf of the consumer. As you are the consumer, you are probably the best person to decide whether the block was right. If you’re unsure then ask yourself this one question – do you trust any streaming service with no direct competition to ensure the price remains competitive and offer the best value to you?
Your answer probably determines which side of this dispute you fall on, and ultimately whether you think the block of Venu Sports was the right move.
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