Q: What just happened?

 Disney is set to take a majority stake in FuboTV, the primarily sports-driven virtual multichannel video programming distributor (vMVPD), with plans to merge it with its own vMVPD, Hulu + Live TV. 

The deal will see Disney take 70% control of Fubo - with the triad of Disney, Fox, and Warner Bros. Discovery (WBD) paying Fubo $220m and Disney chipping in an additional $145m loan. While the newly formed vMVPD company will operate under the Fubo name, and network carriage negotiations for both Hulu + Live TV and Fubo will be centralised under Fubo, both platforms will continue to be offered as distinctly branded products. Fubo will introduce cheaper bundles that include Disney’s ESPN and ABC networks, while content and licensing decisions will remain business-as-usual for Hulu’s SVoD service.

The deal also sees the end of the current litigation process between Fubo and Disney regarding the planned sport streaming service Venu Sports. Disney, WBD and Fox announced in February 2024 plans to collaborate on a joint venture streaming service, which would combine sport content from their respective ESPN, TNT Sports and Fox Sports subsidiaries and make it available to consumers through a single unified service. However, the service did not launch as planned in 2024, due to an antitrust lawsuit filed by Fubo, which resulted in an injunction blocking launch until litigation in October 2025. The acquisition of Fubo by Disney ceases this injunction, and means Venu Sports will be able to go live in the near future.

Q: What are the implications for the US vMVPD market? 

The merger could take up to 18 months to come to fruition, at which time Hulu + Live TV and Fubo are forecast to have 4.75m and 1.6m subscribers respectively (a collective 6.35m subs, up slightly from the current total of 6.2m). In this time frame the largest US vMVPD competitor, YouTube TV, is expected to continue growing - thanks to its popular NFL Sunday Ticket promotion – and will reach around 10.5m subs by the time Hulu + Live TV and Fubo become a single entity.  

The post-merger vMVPD landscape will therefore consist of two major players, YouTube TV and the new Hulu/Fubo entity, followed by a number of significantly smaller services. The next largest vMVPD, Dish-owned Sling TV, currently has 2.14m subs but has seen subscriber numbers stagnate recently. Likewise, other smaller vMVPDs such as Philo and DirecTV Stream have also struggled to make substantial subscriber gains – remaining at around 1m and 0.3m subscribers each for the last several quarters, even as 4.6m subscriptions churned away from pay TV contracts in the US in 2024. 

The resulting vMPVD lead of YouTube TV and Hulu/Fubo could impact the wider market in several ways. We are likely to see M&A activity around smaller vMVPDs as they seek to remain competitive – either by joining forces directly with each other to form a third large market entrant, or via acquisition from either YouTube TV or Hulu/Fubo as they continue to scale up operations. Meanwhile, it is also possible we could see activity via new entrants to the market, as existing pay TV players – such as Comcast or Charter - look to separate out their current pay TV operations from the existing bundled dependency on broadband and mobile, and instead operate them as wider virtual packages over any IP network. 

Q: What does this mean for Venu Sports?

As mentioned, part of this deal with Disney sees Fubo drop the antitrust lawsuit it filed against Venu Sports last year. Unlike the merger – which will take time to come to fruition – this aspect of the deal has immediate implications for the streaming market, as it means Venu can look to launch in 2025. One remaining risk for Disney and Venu is whether another party looks to pick up similar legal action where Fubo left off, and/or raises objections to the new merged entity on competition grounds. 

Together, the three Venu partners hold 51% of current TV sports rights in the US, ultimately bringing $14.3bn in TV rights value to the sport streaming market. Considering the bundle that exists of Disney+, Hulu, and Max, the addition of Venu (and maybe even Fubo) would create a streaming package of live and on-demand programming much like traditional pay TV – including family content, news and entertainment, and sports – that cord-cutters may find appealing, as opposed to having to manage many separate subscriptions. 

As of now, however, the timeline for Venu’s launch remains uncertain – and the wider sports streaming strategies of its constituent members differ. Disney is currently focused on getting its flagship ESPN standalone streaming service ready for launch in the latter half of 2025, while Fox and WBD may want to deploy Venu as soon as possible to maximise the return on their costly sports rights. 

Moreover, we have yet to see many instances (outside of vertical bundles such as Disney+ and ESPN+) of sport streaming services bundling with general entertainment VoD services – in part due to the sheer level of fragmentation of sports rights. But if Venu does decide to deploy a more horizontal model long-term, and enable other services to bundle or re-distribute it, we could start to see the beginning of other, more flexible entertainment and sport bundles, that again “look” more like traditional pay TV.

Ampere subscribers can read more analysis on US streaming service bundling here. 

UPDATE: As of January 10th 2025, Venu Sports willl be discontinued, effective immediately, after a collective decision by ESPN, Fox and WBD. "After careful consideration," the three companies said in a joint statement, "we have collectively agreed to discontinue the Venu Sports joint venture and not launch the streaming service. In an ever-changing marketplace, we determine that it was best to meet the evolving demands of sports fans by focusing on existing products and distribution channels."