DOJ Probes Disney’s FuboTV Acquisition Over Antitrust Concerns

The US Department of Justice has launched an investigation into Walt Disney Co.’s recent agreement to acquire a controlling interest in streaming platform FuboTV Inc., raising questions about potential impacts on competition within the sports streaming market, according to Bloomberg.

Sources familiar with the matter, who requested anonymity due to the sensitivity of the issue, revealed that antitrust officials are closely examining whether the merger could create a dominant force in the digital sports broadcasting sector. The concern centers around whether the consolidation could stifle competition and limit consumer choice in the rapidly evolving streaming landscape.

Per Bloomberg, the transaction, announced in January, merges Disney’s Hulu + Live TV service with FuboTV, a platform known for its sports-centric offerings. As part of the deal, Disney would hold a 70% stake in the new venture, with existing Fubo shareholders retaining the remaining 30%. This merger positioned the combined entity as the second-largest digital pay-TV provider in the United States.

The deal also resolved a previous lawsuit filed by Fubo against Disney, Fox Corp., and Warner Bros Discovery Inc., over a planned sports streaming collaboration named Venu. Fubo alleged that the Venu initiative would have unfairly restricted competition by limiting other companies’ access to key sports content. Shortly after the lawsuit was dropped, the Venu project was scrapped, and Disney and Fox agreed to pay Fubo $220 million as part of the settlement, according to Bloomberg.

Read more: Disney-Fubo Deal Sparks Antitrust Concerns from DirecTV, Dish, and EchoStar

The Justice Department has not issued any public comment on the investigation. Similarly, representatives from Disney and Fubo have yet to respond to media inquiries regarding the inquiry.

Senator Elizabeth Warren has also voiced apprehension over the merger, calling for a thorough antitrust review in a letter to the Justice Department earlier this year. The Massachusetts senator argued that the deal could serve as a workaround for Disney to eliminate legal risks while simultaneously expanding its control over the sports streaming market. She cited the agreement as part of what she described as a broader pattern of anticompetitive conduct by the entertainment giant.

Warren had previously warned against the Venu partnership, expressing concerns that such a service could dominate the live sports streaming space and restrict innovation and price competition. The disbanding of Venu has not assuaged all fears, especially as the Disney-Fubo merger moves forward under regulatory scrutiny.

Source: Bloomberg