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Sports on streaming will get more expensive, Fubo CEO warns

The company is currently fighting two programming partners in court over plans to develop a competing sports-inclusive offering.

The company is currently fighting two programming partners in court over plans to develop a competing sports-inclusive offering.

A Fubo TV guide listing shows an event for the 2022 FIFA World Cup.
A Fubo TV guide listing shows an event for the 2022 FIFA World Cup. (Graphic by The Desk)

Sports fans have it rough these days, with costs climbing just to follow a single team or franchise on television — and those costs will only get more expensive over time, according to the CEO of a major sports streaming platform.

On Wednesday, Fubo CEO David Gandler complained that broadcasters and the leagues were making it difficult for sports fans to stay on top of their favorite competitions by siphoning off live events for various streaming services.

The end result is that most sports fans have to pay for several services just “to get one or two games,” Gandler said in an interview with Yahoo Finance.

“[Consumers] are basically double-paying in more than 30 to 50 percent of cases for the same content,” Gandler proffered.

Take football, for example: Games played on CBS, Fox and NBC are available on free-to-air television across much of the United States, and Fubo itself provides many of those games through its streaming service by virtue of its carriage deals with all three networks.

Monday night games are exclusive to cable — The Walt Disney Company’s ESPN has held the telecast rights to “Monday Night Football” for years — which isn’t a problem if you have Fubo, since the service also offers that channel.

But football fans whose team might play a Thursday night game have to switch to a different app entirely, since the rights to those games are held by Amazon for its Prime Video service. While Thursday Night Football also streams (for now) on the free service Twitch, games can only be watched on computers, tablets and phones — leaving out the biggest screen in the room, unless football fans are willing to pay for Prime Video.

Things are even more complicated for fans of baseball, with rights spread across regional sports channels (most of which Fubo carries), broadcast TV, Prime Video, Apple TV Plus and other platforms. Basketball fans have it difficult, too, with games airing across network TV, regional sports channels, TNT, ESPN and NBA TV, depending on the team and location.

All this means sports fans are having to pay several times over for access to live games that, for the most part, were once available almost in their entirety on broadcast, cable and satellite TV.

The costs associated with delivering live sports on cable and satellite are increasing, too, with broadcasters charging pay TV platforms higher fees every year for the privilege of carrying sports-inclusive channels.

Fubo is almost entirely reliant on its relationships with broadcasters and other sports programmers, as channels like Fox, ABC, NBC, CBS, ESPN, Fox Sports 1 and CBS Sports Network are highly sought after. But maintaining those relationships come at a high cost: Fubo is one of the most-expensive streaming cable replacements on the market, charging $80 per month for a base programming package, plus a regional sports fee that add another $11 to $14 per month to a bill, depending on where a person lives. Like other services, Fubo’s packages are cost based on how much they must pay to carry certain channels.

Now, Fubo has found itself at war with two of its programming partners — Fox and Disney — after the companies announced plans to join forces with Warner Bros Discovery (WBD) for a joint venture that would see the development of a sports-inclusive streaming television service, one that is likely to compete with Fubo head-on.

Those plans call for the joint venture to launch a new streaming product later this year, one that will include channels like Fox, ABC, ESPN, Fox Sports 1, TBS and TNT, priced around $45 to $50 per month, according to reports.

The product won’t include channels like FX, CNN, Freeform, Disney Channel and Fox News, which offer little to no sports. In that respect, it breaks from the traditional pay television product, in that the broadcasters won’t force the new joint venture to “bundle” entertainment, sports and news channels together — an arrangement that cable and satellite companies are generally forced to take, including streaming cable alternatives like Fubo.

This week, Fubo filed a lawsuit against the three companies, accusing them of stealing the company’s sports streaming playbook. It also takes issue with the broadcasters’ plans to offer the joint venture a sweet carriage deal that looks extremely different from what other cable, satellite and streaming cable-like services are forced to take.

To that last point, Fubo said it and other cable providers have long wanted to offer packages that only include sports channels — in fact, that goes to the heart of Fubo’s identity as a sports-first service. But the broadcasters insist cable companies offer other non-sports channels if they want to carry sports networks, too, with very little wiggle room (though there have been some recent exceptions).

The situation has also drawn immense criticism from industry groups like ACA Connects, which represents small and rural-area cable TV providers. Like Fubo, they’ve cried foul at Fox, Disney and WBD’s plans to launch a sports-inclusive streaming service that doesn’t include other channels.

“With customers facing higher prices and fewer affordable choices, there needs to be a level playing field,” Grant Spellmeyer, the CEO of ACA Connects, said in a statement earlier this month.

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About the Author:

Matthew Keys

Matthew Keys is a nationally-recognized, award-winning journalist who has covered the business of media, technology, radio and television for more than 10 years. He is the publisher of The Desk and contributes to Know Techie, Digital Content Next and StreamTV Insider. He previously worked for Thomson Reuters, the Walt Disney Company, McNaughton Newspapers and Tribune Broadcasting.
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