Just one week into 2025, the media industry has made its first major deal. The Walt Disney Company is buying a 70 percent stake in Fubo, the video service that was suing to block the media giant's plans to form a sports streaming joint venture with Fox called Veenu. Warner Bros. Discovery.
The agreement announced Monday ends that litigation. Instead, Fubo will be integrated with Disney's Hulu + Live TV service. But the deal raised some big questions.
Who benefits from Disney and Fubo's deal?
Although there have been questions about Disney's Hulu plans for years (the company now owns all rights to the streaming service), Disney CEO Robert A. Iger, a media analyst at Lightshed Partners, said: List, effectively offloading what Richard Greenfield called “the least interesting part.'' Hulu.
Investors will be watching to see how long it takes for Disney to begin selling its stake in the Fubo-Hulu + Live TV business.
Fox and Warner Bros. Discovery, along with Disney, will pay $220 million to settle the lawsuit. Fubo. (Disney also plans to make a $145 million loan to Fubo.) They said the costs of the Fubo settlement would be covered by the profits they expect to make from Veenu. Looks like he's betting.
The agreement appears to legitimize Fubo executive chairman Edgar Bronfman Jr.'s decision to block Venu's launch.
Bronfman's holdings in Fubo stock have not been disclosed, but he is believed to be one of the company's largest individual shareholders. And it creates a new narrative for him after his Paramount acquisition plan was scrapped last year.
Are Venu's antitrust problems really over?
Fubo may have settled its fight to block its streaming operations, but the Department of Justice has filed an amicus brief in the case, and Fubo's proposed settlement does not include the company filing its own lawsuit. Nothing is forbidden.
Advocacy groups are calling on the Trump administration to closely monitor Mr. Veenu. “Over the past year, Fubo led sports fans and industry observers to believe it was seriously interested in taking on Disney's illegal joint venture in sports streaming, but it ended up cashing the check and leaving the consumer and only made things worse for the streaming industry as a whole,” said the paper's Lee Hepner. The American Economic Liberties Project, which calls for stronger antitrust oversight, said in a statement Monday.
What will happen to the new Fubo?
Investors are clearly bullish on the service gaining greater scale to compete. But even though the company's stock price rose 251% on Monday, Fubo's market value remains at a relatively low $1.7 billion, and the company has a relatively low market value of $1.7 billion. It is competing against wealthy rivals in the field.
