Three members of US Congress have written to the government expressing concerns regarding Venu Sports, a major new sports venture launching later this year.
Senators Bernie Sanders and Elizabeth Warren, both former US presidential nominees for the Democratic Party, and Representative Joaquin Castro, a fellow Democrat, believe that the Vennu Sports joint venture will threaten market competition.
Announced in February 2024, Venu Sports is a joint venture between Warner Bros. Discovery (WBD), FOX and Disney-owned ESPN, three of the biggest companies in US sports broadcasting.
Although the other prominent sports media outlets of NBC and, CBS are not involved, Venu will still gain a significant foothold in North American sports broadcasting.
The three Congresspeople believe that this will pose an antitrust issue, affecting both market competitiveness and consumer choice. The trio have made their case in a co-signed letter to the US Department of Justice and USUnited States Department of Justice.
Venu Sports will be able to control more than 80% of nationally syndicated US sports and over half of all national sports content, the three legislators assert. This would put it in a position to “exercise monopoly power over televised sports”, they claim.
The politicians’ concerns are primarily based on the already extensive reach that WBD, FOX and ESPN have already established in US sports.
As it stands, the three broadcasters have licensing agreements with the NBA, NFL, WNBA, MLB, NHL, NASCAR, NCAA college sports, UFC, PGA TOUR Golf, Grand Slam Tennis and the FIFA World Cup.
It is important to note that these leagues and associations do have other agreements in place too, however. The NFL maintains deals with ESPN, FOX, CBS and Amazon Prime Video, for example, and the NBA recently put pen to paper on a record media deal with NBC, Amazon, ESPN and ABC.
Regardless, the sheer weight of sports content Venu will be able to produce is impressive, and will no doubt make it a formidable player in the US sports market. The political trio are further concerned by the backing it will get from its parent companies’ structure.
Venu will be supported by content from ESPN’s ESPN, ESPN+, ESPN2, ESPNU, SECN, ACCN, ESPNEWS channels, FOX’s FOX, FS1, FS2 and Big Ten Network (BTN), WBD’s TBS and truTV, as well as the American Broadcasting Corporation (ABC) – which like ESPN is owned by Disney.
The letter asserts that this will leave the remaining US sports broadcasters in a difficult position of having to negotiate with WBD, FOX and Disney for media rights whilst also competing against these same companies.
The trio also assert that consumers could be left in the position of facing price increases on subscriptions, should the JV proceed and the three companies assert what they believe is unfair market dominance. As it stands, Venu Sports’ monthly subscription is set to be $42.99 a month.
“Using its extensive control of sports licensing rights, Fox, Disney, and Warner Bros. would be able to exert joint control over live sports from distribution through broadcast,” the legislators’ letter explains its case.
“In addition to horizontally integrating across the sports licensing market, this JV will vertically integrate the sports streaming market by jointly offering a new distribution platform for the licensed content that is controlled by these companies.
“The proposed structure presents these companies with a clear financial incentive to preference their own streaming platform over alternative sports streaming providers in licensing and bundling deals.”
This is the second major complaint against the proposed JV, following legal action initiated by FuboTV, a streaming platform which covers the NFL, MLB, NBA, NHL, MLS, English Premier League and Canadian Premier League (CPL).
Fubo argued a similar case to that presented in Warren, Sanders and Castro’s letter, arguing that Venu’s business model will violate antitrust laws and threaten competition.
Countering Fubo in a Lower Manhattan court, Venu’s legal representation stated that preventing the JV would prevent customers from accessing an all-in-one sports service at a cheaper price than those already on the market.
Should the US District Court, DoJ and FCC disregard the challenges launched against Venu, the sports streaming platform plans to launch later this year, most likely during the winter.
