FuboTV
stock was tumbling Wednesday after
Walt Disney
announced a partnership with several media giants to create a sports streaming service.
The news sent shares of FuboTV down 23% on Wednesday to $1.94.
FuboTV
offers a streaming service that focuses primarily on sports.
Disney announced on Tuesday that its subsidiary ESPN,
Fox,
and
Warner Bros. Discovery
have reached a preliminary understanding to form a new joint venture to build a sports streaming platform. The offering, which is scheduled to launch in the fall, would be made available directly to consumers via a new app, and can be bundled with existing Disney+, Hulu, or Max subscriptions.
Fubo said in a statement to Barron’s on Wednesday that the announcement has “undoubtedly” captured the company’s attention.
“Every consumer in America should be concerned about the intent behind this joint venture and its impact on fair market competition,” Fubo said. “This joint venture spotlights a concerning trend where an alliance with significant market share, reportedly controlling 60-85% of all sports content, could dictate market terms in a manner that may not serve the broader interests of consumers.”
Fox declined to respond to a Barron’s request for comment on Fubo’s statement. Disney and Warner Bros. Discovery did not immediately respond to a request.
Raymond James analyst Ric Prentiss wrote in a note Wednesday that while the customer experience for streaming should be much better than traditional cable in, he believes the area that streaming has been most disadvantaged has been sports, “given the desire for fans to have every game, find them easily, and flip between them, all of which has been more difficult in a streaming world.”
Prentiss added that the new service should reduce overall churn for the streaming services of Disney and Warner Bros. That doesn’t bode well for FuboTV.
Write to Angela Palumbo at angela.palumbo@dowjones.com
Read the full article here