Fubo chief David Gandler took the gloves off in lambasting the joint venture formed by Disney, Warner Bros. Discovery and Fox Corp. — reiterating claims that anticompetitive actions by the big media companies has cost sports-centric streaming provider Fubo billions of dollars in damages.
Gandler, Fubo’s co-founder and CEO, told analysts on the streamer’s Q4 2023 earnings call Friday that the joint venture, targeted to launch later in 2024, is “attempt to monopolize the sports streaming industry and eliminate competition.”
Last week, Fubo filed a federal antitrust lawsuit against Disney, Fox and WBD, alleging that the companies (together with Disney’s ESPN and Hulu) have “engaged in a years-long campaign to block Fubo’s innovative sports-first streaming business resulting in significant harm to both Fubo and consumers.” Fubo also said it seeks “substantial” monetary damages but its complaint did not specify an amount.
“Their proposed venture is, we believe, just the latest example of this sports cartel’s attempt to block and steal Fubo’s vision of what a sports-streaming bundle should look like, resulting in billions of dollars in damages to our business,” Gandler said on the earnings call. “We consider the defendants’ pernicious contractual terms and other anticompetitive practices borderline racketeering.”
Later in the call, Gandler, in response to an analyst query about the stakes of the fight with the media giants, said, “I think that this is a duel to the death. It has been when we started this company… We are fighting for the tens of billions of dollars that are wasted annually by consumers paying for the same content multiple times.”
Gandler claimed Disney, WBD and Fox Corp. charge Fubo programming fees that are 30%-50% higher than other distributors. If Fubo had received the same rates as Hulu, Comcast, Charter or DirecTV Stream, the company’s financial results last year could have been even better, he asserted. Gandler estimated Fubo paid more than $200 million in 2023 for “content that consumers don’t want” in order to obtain rights to sports programming. Without that expense, the company may have been able to break even last year, he claimed. Fubo expects to achieve profitability in 2025.
“We are asking for an opportunity to compete fairly as a business, and to offer consumers a streaming option that gives them the channels they want, and at a fair price,” Gandler said.
In its complaint, filed in the U.S. District Court for the Southern District of New York, Fubo seeks to block the joint venture or alternatively require restrictions on the defendants in order for the JV to proceed, such as “economic parity of licensing terms.”
On Feb. 6, Disney/ESPN, Fox Corp. and Warner Bros. Discovery announced a joint venture that will create a unified streaming platform that includes ESPN+ and 14 linear TV networks: ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNews, ABC, Fox, FS1, FS2, Big Ten Network, TNT, TBS and truTV. The companies said the streaming bundle will be available from the (as-yet unnamed) joint venture, and as an add-on via services like Disney+, Hulu and Max.
Fubo ended 2023 with 1.618 million paid subscribers in North America, up 12% year over year, after adding 141,000 in the year-end quarter. For Q4, the company reported $402 million in total revenue, up 29%, with ad revenue coming in at $38.6 million, up 15% versus the year-earlier quarter. Net loss for Q4 was $70.1 million, an improvement over the $152 million net loss in the same period in 2022.
