Fubo has agreed to drop its legal action over the launch of Venu Sports, a streaming venture backed by The Walt Disney Company, FOX Corp., and Warner Bros. Discovery. Instead, Fubo has accepted a $220 million settlement and will assist with the development of the Venu product, which had been delayed due to a preliminary injunction secured by Fubo last August.

A new streaming powerhouse 

The collaboration will establish the second-largest internet pay-TV provider in North America, trailing only YouTube TV. The new entity will boast a subscriber base of 6.2 million. This strategic alignment merges Disney’s US pay-TV service, Hulu with Live TV, with Fubo to form a joint company. Disney will own 70 percent of the venture, while Fubo retains 30 percent as a publicly traded company. Additionally, Disney has committed to funding a $145 million term loan, payable next year.

Leadership and vision

David Gandler, Fubo’s CEO, is set to lead the newly formed company. Gandler, who recently warned of potential bankruptcy for Fubo due to plans for unbundling sports channels, expressed optimism: “This combination enables us to deliver on our promise to provide consumers with greater choice and flexibility. Additionally, this agreement allows us to scale effectively, strengthens Fubo’s balance sheet, and positions us for positive cash flow. It’s a win for consumers, our shareholders, and the entire streaming industry.”

Expanded sports & broadcast offerings

Disney will establish a new carriage agreement with Fubo, enabling the creation of a Sports & Broadcast service akin to Venu. This service will feature Disney’s premium sports and broadcast networks, including ABC, ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNEWS, and ESPN+. The agreement ensures access to a comprehensive sports package for enthusiasts.

Independent Platforms

Despite the merger, Hulu + Live TV and Fubo will remain available as distinct offerings. Hulu + Live TV will continue streaming via the Hulu app and as part of Disney’s popular bundle, which includes Hulu, Disney+, and ESPN+. Meanwhile, Fubo will maintain its standalone app and focus on delivering over 55,000 live sporting events annually to its subscribers. Both services will negotiate carriage agreements independently from Disney, ensuring tailored content for their audiences. In addition to its North American operations, Fubo owns the French pay-TV platform Molotov. This acquisition positions the company to leverage global opportunities and expand its market reach.