In 2022 a group of YouTube TV subscribers sued Disney, arguing it used its dominance with ESPN and streaming to drive up the cost of YouTube TV, DIRECTV STREAM, and other services. Now, a judge has ruled that Disney must face an antitrust lawsuit over its ownership of Hulu + Live TV along with ESPN and how it uses them.
The argument is that Disney’s ownership of ESPN has been used to drive up the price of streaming services. The argument here is that Disney says if you want the Disney Channel, for example, you have to also pay for ESPN. This drives up the price of competitor services like YouTube TV and DIRECTV STREAM.
Back in February 2023, Disney lawyers asked a judge to dismiss the antitrust case. Saying the plaintiffs “misconstrue basic antitrust and economic concepts.” Disney argues that the plaintiffs have failed to show a relevant antitrust market in which competition was hard. Now, though, the Judge has denied that request, saying the trial must go forward.
Disney is not alone in trying to bundle its channels together, as many media groups do this. Want TBS? You need to get all the Turner Networks, for example. This has resulted in some channels like the History Channel not being carried on YouTube TV as it would result in a bunch of channels being offered, driving up the cost.
We have also seen Fubo unable to get TNT and TBS because it would force them to offer all the Turner channels.
Part of the issue for Disney is that it also owns a live TV streaming service with Hulu + Live TV. The group of 9 complainants argue that since Disney took full control of Hulu in 2019, the price of live TV services like YouTube TV has gone up. They argue that when Disney mandates streaming services to offer ESPN in the cheapest bundle, it drives up the price of the service.
The nine complainants are hoping the Judge will turn this into a class action lawsuit to represent the over 5 million YouTube TV subscribers. They also hope the Judge will order Disney to stop competing with its competitors at the same level of the supply chain by running Hulu + Live TV.
Recently, during Disney’s fight with Spectrum, Disney encouraged Spectrum customers who wanted ESPN to switch to Hulu + Live TV. Spectrum partnered with Fubo to offer a different option to get ESPN. Now, Disney will need to defend running Hulu + Live TV as it tries to get more money for ESPN from its competitors.