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Senator Elizabeth Warren is turning up the heat on Disney (NYSE:DIS), urging the Justice Department to take a hard look at its deal to acquire a controlling 70% stake in Fubo (NYSE:FUBO). The move, which merges Hulu + Live TV with Fubo to create the second-largest digital pay-TV provider, effectively eliminates a competitor while raising serious antitrust concerns. Warren argues that instead of competing, Disney is simply buying its way to a stronger market positiona strategy that could squeeze consumers with higher prices. The timing is also telling: this acquisition conveniently puts an end to Fubo's lawsuit against Disney, Fox, and Warner Bros. Discovery over their now-abandoned Venu Sports joint venture.
This deal isn't just about streamingit's about control. Fubo had previously accused Disney and its partners of using their dominance to box out competition in live sports streaming, and a judge even blocked Venu's launch last year. The Biden administration backed that decision, recognizing the risk of market consolidation. Now, with Venu off the table and Disney tightening its grip, Warren is making it clear: this is more than just another acquisition, it's a play to dominate an already concentrated industry. If approved without intervention, Disney's increased market power could reshape the streaming landscape in its favor.
Meanwhile, Disney is doubling down on sports, preparing to roll out a standalone ESPN streaming service this fallanother move that could further shift the market dynamics. CEO Bob Iger recently brushed off concerns about Venu's cancellation, citing the rise of skinny bundle alternatives. But with Disney expanding its streaming empire, regulatory scrutiny is bound to intensify. For investors, the key question isn't just whether this deal goes through, but whether Disney's aggressive consolidation strategy will hold up under mounting legal and political pressure.
This article first appeared on GuruFocus.