Congressmen Jerry Nadler and Joaquin Castro have called on Disney, Warner Bros Discovery, and Fox to provide detailed information about their proposed sports streaming service. The lawmakers have expressed concerns about the impact on access, competition, and choice in the sports streaming market. They are seeking transparency on pricing, licensing terms, and measures to prevent anti-competitive practices. The Department of Justice has been copied on the request. This comes amidst a lawsuit filed by Fubo, accusing the companies of anticompetitive behavior. The fate of the joint venture remains uncertain as regulatory scrutiny increases.
Congressmen Demand Answers from Disney, Warner Bros Discovery, and Fox Over Proposed Sports Streaming Venture
( Credit to: Deadline )
Representative Jerry Nadler (D-NY) and Representative Joaquin Castro (D-TX) have called on Disney, Warner Bros Discovery, and Fox to provide detailed information about their proposed sports streaming service. The lawmakers have expressed concerns about the impact on access, competition, and choice in the sports streaming market. They are seeking transparency on pricing, licensing terms, and measures to prevent anti-competitive practices. The Department of Justice has been copied on the request. This comes amidst a lawsuit filed by Fubo, accusing the companies of anticompetitive behavior. The fate of the joint venture remains uncertain as regulatory scrutiny increases.
Concerns Over Impact on Access, Competition, and Choice
Representatives Nadler and Castro have raised concerns about the potential impact of the joint venture on access, competition, and choice in the sports streaming market. They are specifically looking for transparency regarding pricing, intent, and organization to ensure fair licensing terms for sports leagues and video distributors, as well as affordable prices for consumers.
In their letter to the CEOs, the lawmakers have posed a series of 19 questions to gain a better understanding of the potential anticompetitive nature of the joint venture. They are seeking information on market impact, projected subscribers, distribution of non-joint venture partner channels, pricing strategies, prevention of anti-competitive practices, and measures to avoid collusion between the joint venture partners, among other inquiries. The involvement of the Department of Justice indicates the seriousness of the matter.
Lawsuit and Accusations of Anticompetitive Behavior
Fubo, a sports-focused pay-TV service, has filed a lawsuit against Disney, Warner Bros Discovery, and Fox, accusing them of engaging in anticompetitive behavior. Fubo's CEO, David Gandler, has referred to them as a "cartel" involved in "borderline racketeering." This lawsuit adds to the regulatory scrutiny surrounding the joint venture and raises further questions about its potential impact on competition in the sports streaming market.
Notable Absences and Potential Scale of the Offering
One notable aspect of the joint venture is the absence of Paramount Global and NBCUniversal, key sports rights holders. This raises questions about the scope and scale of the offering. Lachlan Murdoch, one of the CEOs involved, has hinted that the new service could cost more than $50 per month and expects to attract 5 million subscribers within the first five years. However, some industry insiders and regulators view this projection as relatively modest compared to the ambitions of other players in the streaming market.
Overview of the Joint Venture and Competitive Landscape
The joint venture, often referred to as "Spulu," aims to combine 14 linear network feeds from Disney, Fox, and Warner Bros Discovery to provide pre-licensed coverage of major sports leagues such as the NFL, NBA, NHL, and MLB. However, the absence of Paramount and NBCUniversal presents a significant challenge to the status quo. Netflix, Amazon Prime Video, and AppleTV+ have also entered the live sports streaming arena, adding further competition to the mix.
Conclusion
The demand for answers from Representatives Nadler and Castro highlights the need for transparency and fair competition in the evolving sports streaming landscape. The involvement of the Department of Justice and the lawsuit filed by Fubo further emphasize the regulatory scrutiny surrounding the joint venture. As the fate of the proposed sports streaming service remains uncertain, it is clear that the concerns raised by lawmakers and industry stakeholders will play a significant role in shaping the future of the market.