Disney has completed its acquisition of a majority stake in Fubo, which will create the No. 6 pay-TV operator in the U.S. when combined with Hulu + Live TV.
The two services will together have nearly 6 million subscribers in North America. Each will continue to be available as separate services, branded individually. Even so, their new heft makes Disney a larger rival to YouTube TV in the internet-delivered pay-TV space. Disney and YouTube TV, meanwhile, are embroiled in a carriage dispute ahead of Thursday night’s expiration of their current contract.
The streaming combination resulted from Fubo’s antitrust lawsuit against Disney, Fox Corp. and Warner Bros. Discovery over the now-shuttered Venu Sports joint venture. The sports-focused streaming venture was waylaid before its planned 2024 launch after a judge ruled the JV partners had engaged in monopoly behavior, squeezing Fubo as programmers as they planned to launch a competitor.
In announcing the deal close, Fubo and Disney said the merged entity will realize savings from more flexible programming packages (which will cost less for carriage fees) as well as ad optimization and sales and marketing efficiencies. The combined company will have access to a $145 million term loan that Disney has committed to provide Fubo.
In the wake of the Venue battle, several players have come to market with more focused packages, offerings once thought impossible in the traditional economics of pay-TV. Venu’s technology survived the demise of the JV and has helped bolster Fox Corp.’s new streaming service Fox One.
MORE to come …
