Grand Opening, Grand Closing: Disney, WBD, Fox abandon Venu effort
Dish and DirecTV objections and Fubo offering a similar package led to the demise
The Venu is closed before it even opens.
Despite a settlement reached in a lawsuit settled by Disney and Fubo due to the latter agreeing to sell itself to them, the joint venture between Disney, Fox, and Warner Bros. Discovery to launch a new affordable skinny sports bundle has been abandoned. Fubo sued to stop the service from launching, fearing it would undermine its business model, and a federal judge sided with them, granting an injunction against Venu.
“In an ever-changing marketplace, we determined that it was best to meet the evolving demands of sports fans by focusing on existing products and distribution channels,” a statement from Venu said. “We are proud of the work that has been done on Venu to date and grateful to the Venu staff, whom we will support through this transition period.”
The Venu joint venture was announced last spring as an affordable package of channels targeted to sports fans, culled from the three companies including ESPN and its family of networks; Warner’s TBS and TNT; and Fox’s FS1 and FS2. Broadcast networks ABC and Fox were also included, potentially upsetting station groups who are affiliated with them as they receive no retransmission fees for their carriage, as Venu is a virtual provider.
The Fubo-Venu battle became political. Venu received support from Republican Attorney Generals in six states, where college football is phenomenally popular. At the same time, sixteen of their Democratic counterparts (including Illinois AG Kwame Raoul) filed briefs supporting Fubo. On Tuesday, Fubo agreed to merger terms with Disney and agreed to drop its lawsuit against them, and it seemed Venu was on track to launch soon – perhaps as soon as the Super Bowl.
But on Thursday, satellite providers Dish and DirecTV- who operate virtual providers Sling and DirecTV Stream respectively, objected to the settlement, urging Judge Margaret Garnett not to lift the injection against Venu’s launch, stating Disney was trying to buy their way out of an antitrust suit and filed a complaint against Venu themselves Thursday, signaling they could sue the new joint venture themselves.
Needless to say, DirecTV seemed pleased with the outcome.
“DirecTV remains a leader in sports, and we look forward to working with our programming partners – including Disney, Fox, and Warner Bros. Discovery – to compete on a level playing field to deliver sports fans more choice, control, and value all-in-one experience,” the company said in a statement.
Dish and DirecTV- who recently tried to merge but weren’t successful, do business with all three companies through carriage deals.
There was also opposition from medium and small cable operators. “The media giants behind this sports streaming juggernaut threatened to control the marketplace so they could jack up prices and force consumers to pay for bloated bundles of programming,” ACA Connects spokesperson Grant Spellmeyer told The Desk.
There’s no doubt cable and satellite operators are the biggest winners, as a Venu launch would’ve accelerated their subscriber losses. Another is YouTube TV, which would’ve lost customers due to the cheaper price point. Also, Fubo announced it would offer a similar skinny sports bundle package, potentially undermining Venu and the upcoming direct-to-consumer effort ESPN is launching.
Venu also brought to light questions about bundling and whether a stand-alone entity can legally offer a specific programming genre while excluding others. The Venu package did not include channels from Paramount, NBCUniversal, or any regional sports network. While subscribers would love the thought of not paying for channels they didn’t want, cable and satellite providers – who refuse to make such packages available, made sure a stand-alone entity formed by three conglomerates didn’t offer one either.