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This remains a five-alarm fire. We have just days left in our Fall Campaign and the numbers we’re seeing are not good. This is terrifying for us, especially when everything we cherish is on the ballot just one week from now.
Fubo’s case against the launch of a new Disney, Warner Bros. Discovery, and Fox sports streaming service may determine whether the live television market of the future includes a robust number of distributors, or is controlled entirely by programming giants.
Since the launch of cable television, bundling has defined the consumer’s experience. Expensive program packages have always offered a mix of broadly desired and niche programming. The opportunity to buy a slender package of channels tailored to our individual interests has always been out of reach. It was impossible to get what you wanted, without getting what you did not. These bundling requirements have long been dictated by the programming giants like Disney, Warner Bros., and Fox, who control several of the key channels that distributors like cable companies need to offer in order to remain viable.
From the late 2000s to the early 2010s, several on-demand internet streaming services like Netflix, Disney+, and HBO Max, many of which are owned by those same programming giants, came about to offer cheaper access to narrower sets of content, though they rarely offered meaningful options for viewing the live programmatic content available on cable. Then, as more and more consumers sought to have their media delivered over the internet, the advent of live programmatic internet streaming services like Fubo and Sling TV helped recreate the experience of traditional cable. While those services initially innovated, offering slender and specialized live viewing experiences, in recent years they have suffered the same bundling issues that defined the cable industry.
The key to understanding the evolution of television markets is sports. Sports is by far the most popular form of live broadcast entertainment. And because well over 90% of televised sporting events are consumed live in real time, and because consumers have demonstrated a much higher willingness to pay premium rates for live sports content over live television programming, sports are broadly understood as the linchpin of linear television markets. And while no love has been lost between traditional cable providers and live programmatic streaming services, their shared ability to leverage sports contents’ unique appeal has allowed both industries to remain viable for now. (Though cable providers continue to lose market share to live programmatic streaming services with each passing year.) This is despite the longstanding costly licensing deals and onerous channel bundling requirements imposed on them by the large programming giants, namely Disney, Warner Bros. Discovery, and Fox.
Local television stations, which largely rely on carriage fees from redistribution through cable providers, stand to face massive hits to their bottom lines—a loss that could have profound consequences for the broadcast journalism that often serves as the only source of news in information deserts around the country.
This status quo, however, is unstable, largely due to the ongoing pressure on programmers to unbundle popular sports. In that light, the announcement of a new partnership between Disney, Warner Bros. Discovery, and Fox on a sports-centric live programmatic streaming service, Venu Sports, may sound like a revelation to the average consumer. But as demonstrated by a case seeking to block the new partnership brought by Fubo—another live programmatic streaming service—the launch of this service may determine whether the live television market of the future includes a robust number of distributors, or is controlled entirely by programming giants Disney, Warner Bros. Discovery, and Fox.
While sports fans may be eager to finally be able to access the narrow product they have long desired, a monopoly over live sports offerings threatens to harm consumers broadly by driving out any potential distribution competitors to the programming giants. These giants, which also control large swaths of other pieces of the media industry (including Disney’s direct ownership of live programmatic service Hulu + Live TV), control the distribution rights of over 80% of national live sports broadcasts, and over 50% of the cumulative national and regional sporting events rights. With that market power, these giants could destroy what remains of the cable television market and stifle competition in the market for live programmatic streaming services before it fully gets off the ground.
Fubo argues as much in their complaint. Fubo, which launched in 2015 as FuboTV, has a particularly strong case to make against why the coercive practices imposed by the programming giants should be cause for grave alarm among antitrust authorities. In their case, they recount their decade-long effort to negotiate such a sports-centric streaming service with the programming giants. While initially successful, the company claims that it quickly faced resistance once its model gained steam.
In a section of the complaint titled “The Empire Strikes Back” (a jab at lead defendant Disney’s vast media empire, which includes the Star Wars franchise) the company claims its rapid early growth was quickly squashed by the programming monopolists, which Fubo claims used more burdensome bundling requirements as well as a series of kickbacks and most-favored-nation clauses with non sports-centric live programming streamers (including Disney’s Hulu + Live TV) to make Fubo’s preferred packages economically inviable. With these onerous requirements still in place and the launch of Venu Sports imminent, the company claims it may soon be forced out of business altogether. That existential concern led Fubo to seek a preliminary injunction stopping the launch of the partnership, which is being heard from August 6 through August 9, with a decision expected within a few weeks’ time.
While Fubo’s story is uniquely galling, it is far from alone in its worries about the ripple effect the launch of the joint venture could have on sports leagues and the entire live television ecosystem. Local television stations, which largely rely on carriage fees from redistribution through cable providers, stand to face massive hits to their bottom lines—a loss that could have profound consequences for the broadcast journalism that often serves as the only source of news in information deserts around the country.
The very sports leagues whose content stands to be distributed by the new joint venture have also expressed alarm at the prospect the three giants may begin bidding for licenses as a unit, which would drastically reduce the number of license buyers in the market and potentially kneecap licensing revenue growth. And satellite television providers Dish Network and DirecTV, which have long sought greater flexibility over their channel offerings, have filed affidavits in the case supporting Fubo’s claims. ACA Connects—a trade group representing hundreds of small and mid-sized broadband, video, and phone providers who often but heads with the satellite giants—also released a scathing statement about the deal.
The Department of Justice and federal lawmakers have heeded those cries, and have promised to scrutinize the terms of any final deals once they are released—though they have expressed frustration over the programming giants’ ongoing refusal to answer basic conflict of interest questions mere months before Venu Sports is expected to launch.
Despite this broad coalition of opponents and skeptics, Fubo’s case for a preliminary injunction remains marred by uncertainty. Even though they present many of the same practical anti-competitive challenges, federal courts have historically been reluctant to police joint ventures with the same force as full-blown mergers. Should the programming giants successfully squash a preliminary injunction, it is uncertain whether federal enforcers and the potential jurors Fubo has asked to decide the case can muster the will to put the cat in the bag, especially if Venu Sports’ competitors suffer the swift devastation they claim is likely. What is certain, though, is that as the hearing over the new service’s launch unfolds this week, the entire live entertainment industry is tuning in.
Writers Guild of America members and local allies picketed outside while the crowd in the stadium booed David Zaslav and made clear to the industry executive that "we don't want you here."
As unionized film and television writers across the United States continue to strike, Warner Bros. Discovery president and CEO David Zaslav was met with critical chants both inside and outside of Boston University's Sunday commencement ceremony, during which he spoke and received an honorary degree.
After weeks of negotiating with Zaslav's company as well as Amazon, Apple, Disney, NBCUniversal, Netflix, Paramount, and Sony under the the Alliance of Motion Picture and Television Producers (AMPTP), the Writers Guild of America (WGA) launched the strike in early May, saying that "the studios' responses to our proposals have been wholly insufficient, given the existential crisis writers are facing."
That same week, BU announced Zaslav as a commencement speaker, sparking backlash from students, alumni, community members, and the WGA, East director of communications, Jason Gordon, who expressed "deep disappointment with the university over its poor decision" to provide the industry CEO with a platform.
"Boston University should not give voice to someone who wants to destroy their students' ability to build a career in the film and television industry," Gordon told
The Boston Globe. "The university should expect students, Writers Guild members, as well as other unions and community groups to picket Zaslav's commencement address."
WGA members delivered the promised picket with support from local allies, including members of BU Young Democratic Socialists of America (YDSA) and Boston DSA, who made signs that said: "F*!# Zaslav! Solidarity With the Writers."
\u201cSolidarity with the Writers Guild on strike! Out here with @Boston_DSA and @BU_YDSA comrades picketing Warner Bros. Discovery CEO David Zaslav\u2019s commencement speech at BU.\u201d— Mike Connolly (@Mike Connolly) 1684692373
\u201cAfter getting booed by BU students David Zaslav had to cross the WGA picket line and Scabby the rat on his way out of the VIP exit. Sorry not sorry.\u201d— Annie Stamell (@Annie Stamell) 1684698472
Within Nickerson Field, "boos and expletives rained down" on Zaslav, who graduated from the BU School of Law in 1985.
During his speech, the CEO did not address the ongoing strike, "or the several dozen students who turned their backs to him, and instead shared the strategies that helped him become one of Hollywood's most powerful figures," reportedBU Today.
\u201cWarner Bros. Discovery CEO David Zaslav was met by a huge WGA-DSA picket at BU's commencement today \u2014 with hundreds outside, plus Scabby and a plane, as BU grads turned their backs and drowned him in boos and chants\n\nPay your writers, David, and get the fuck out of Massachusetts\u201d— \ud835\uddea\ud835\uddfc\ud835\uddff\ud835\uddf0\ud835\uddf2\ud835\ude00\ud835\ude01\ud835\uddf2\ud835\uddff \ud835\uddd7\ud835\udde6\ud835\uddd4 \ud83c\udf39 (@\ud835\uddea\ud835\uddfc\ud835\uddff\ud835\uddf0\ud835\uddf2\ud835\ude00\ud835\ude01\ud835\uddf2\ud835\uddff \ud835\uddd7\ud835\udde6\ud835\uddd4 \ud83c\udf39) 1684709485
As The A.V. Club's Sam Barasanti wrote Sunday:
It seems like, for those of us who weren't there, that Zaslav's speech was as stunningly out-of-touch with reality as the decision to host him was in the first place, which speaks to a general contempt he seems to have for... oh, let's say everyone.
This is a man who was put in charge of a massive media empire, and the most notable things he has done with that power are burn money, dismantle one of the most prestigious brands in entertainment, double-dip on promoting J.K. Rowling, kick off the now-common trend of studios deleting content from their streaming services and making it completely inaccessible in some cases, and—how can we forget?—driving the writers who make his shows and movies to go on a strike that may soon lead to similar strikes from the DGA and SAG-AFTRA that would render Hollywood completely motionless.
According to The Hollywood Reporter, "'We don't want you here,' 'Pay your writers,' and 'Shut up, Zaslav' could be heard emanating from the crowd, messages similar to the prepared chants for the picket, including some created by the school's YDSA chapter members and school students who were inspired by BU hockey chants."
\u201cEnjoy a free serotonin boost every time he\u2019s forced to pause!\u201d— DSA-LA's Hollywood Labor (@DSA-LA's Hollywood Labor) 1684696957
\u201cThe WGA is thankful to all the B.U. graduates for chanting "Pay your writers" at Warner Bros. Discovery CEO David Zaslav while he delivered the #BU2023 commencement address. #WGAStrike\u201d— Writers Guild of America, East (@Writers Guild of America, East) 1684698396
As The Hollywood Reporter detailed:
Students from BU's College of Communications, which houses its film and TV program, as well as the College of Fine Arts and some enrolled in the College of Arts and Sciences, were among those who had expressed interest or were expected to take part in the ceremony protest, according to Vanessa Barlett, a graduating senior who helped lead the student-led writers strike solidarity event inside Nickerson Field.
"I'm in the same college as a bunch of film and TV kids," Barlett, who studied political science and journalism and was among those who created the day's official chants, told The Hollywood Reporter ahead of the event. "I'm friends with a lot of people in the College of Fine Arts, people who are in the theater arts program, so having a sense of solidarity is very important to me."
Some progressive lawmakers also weighed in—including Sen. Bernie Sanders (I-Vt.), who tweeted that "if Warner Bros Discovery can afford to pay its CEO David Zaslav $286 million in compensation over the past two years, it can afford to pay its writers much better wages and benefits. Mr. Zaslav: Listen to the Boston University students and the Writers Guild. Pay your writers."
\u201c\ud83d\udc68\ud83c\udffc\u200d\ud83d\udcbc \u201cYou have to listen to people you disagree with\u201d\n\n\ud83d\udde3\ufe0f \u201cPay your writers!\u201d\n\n\ud83d\udc68\ud83c\udffc\u200d\ud83d\udcbc \u201cNo, not me. Not like that\u201d\u201d— Alexandria Ocasio-Cortez (@Alexandria Ocasio-Cortez) 1684707030
Striking workers' demands from studios, which include pay increases and limits on artificial intelligence, "would gain writers approximately $429 million per year," according to WGA. "AMPTP's offer is approximately $86 million per year, 48% of which is from the minimums increase."
This article has been updated with tweets from Worcester DSA, Sen. Bernie Sanders, and Rep. Alexandria Ocasio-Cortez.