On Friday, Walt Disney (NYSE: DIS), Fox Corporation (NASDAQ: FOX), and Warner Bros Discovery (NASDAQ: WBD) abandoned plans to launch Venu Sports, their live sports joint venture, pulling the plug on a much-heralded effort that ran into substantial legal opposition.
Shares of Warner Bros Discovery were down about 2%, Fox’s stock fell about 1%, while FuboTV’s (NYSE: FUBO) shares were up nearly 8% after the surprise announcement.
The media giants created the streaming venture to try to attract younger viewers who don’t subscribe to cable TV, with the idea being to bundle their massive portfolio of sports rights, including the National Football League, the National Basketball Association, and the FIFA World Cup.
Media companies have been looking to capitalize on the growing popularity of live sports and investing large sums to bring audiences to their platforms and boost viewership.
Venu had plans for 5 million subscribers in its first year.
“After careful consideration, we have collectively agreed to discontinue the Venu Sports joint venture and not launch the streaming service,” the companies said on Friday.
The abrupt move comes just days after Disney appeared to have removed one legal obstacle to the deal, agreeing to merge smaller streamer FuboTV – a rival that had sued the media giants for anti-competitive behavior – with its Hulu Live service.
However, satellite TV providers Echostar (NASDAQ: SATS) and DirecTV complained about those developments, signaling more legal troubles ahead.
In court filings last year, the U.S. Justice Department and 16 U.S. states said they support a court order won by FuboTV in August that temporarily blocked Walt Disney, Fox, and Warner Bros Discovery from launching a competing sports streaming venture.
Fox NASDAQ: WBD NYSE: DIS Venu Walt Disney Warner Bros. Discovery
