Venu? We Hardly Knew You.
Martin Peers
Ball on the 1-yard-line, Venu lines up to punch it into the endzone. FUMBLE!
A judge blocked the roll-out of the service which was apparently launching this month. It's yet another bungling of this particular bundle. And now Martin Peers thinks it may never actually launch:
Sports fans, listen up. If you were planning to sign up for the new Venu sports-streaming service due to launch this fall—to include sports cable channels such as ESPN, TNT and Fox Sports 1, all for the cut-rate price of just $43 a month—think again. Chances are Venu will never see the light of day, thanks to a judge’s ruling on Friday night blocking the launch temporarily.
A read of the judge’s decision makes it clear there’s a solid antitrust case against the venture, which makes it hard to see how Venu’s owners—Disney, Fox and Warner Bros. Discovery—can resuscitate the plan. (They’ve promised to appeal.) It also makes you wonder what the folks at those companies were thinking when they greenlit this idea.
Yeah, while it started as just a silly name, once the details about the joint venture started to be revealed, this initiative made less and less sense, from a number of angles. While at a high-level, a stand-alone sports streaming service is obviously highly desireable, the realities of the market make it decidedly less feasible. Namely, how expensive it would have to be in order to showcase all sports content.
And so Venu wasn't going to have all sports content – notably with big holes in the all-important NFL rights (and next year in NBA rights too, with Warner Bros Discovery losing those to NBC and Amazon – neither of which is a part of this bundle). So it was really like a partial sports bundle. And at $42.99, it was too expensive for what it was offering. And again, that was far cheaper than what it would be with all the content. And cheaper than FuboTV, which that other sports streaming bundle clearly didn't like too much given the players involved – and the judge agreed.
Here’s where the logic gets convoluted (and hard to believe). WBD, Disney and Fox didn’t want the venture to accelerate the cord-cutting phenomenon. Instead, according to the judge’s recounting of events, the companies hoped Venu would lure young people who didn’t subscribe to cable. But that theory was undercut by the companies’ own estimates that between 50% and 70% of the expected subscribers would be cable subscribers switching.
So given that risk, not to mention the legal jeopardy, why create this joint venture? The companies are under pressure to respond to the general migration of consumers to streaming services, as well as streaming giant Amazon Prime Video’s moves to license live sports. It’s almost as though the executives decided they had to be seen to be doing something—anything at all—however boneheaded. Have they learned a lesson yet?
The original announcement seemed not-coincidentally-timed with Disney's earnings, so that Bob Iger had a sports streaming offering to talk about since the one everyone was really waiting for – stand-alone ESPN – would still be 18 months away. As I wrote at the time, this felt like a thrown-together offering to placate Disney shareholders while perhaps allowing them to experiment a bit more (alongside WBD and Fox) in the streaming space with sports. But it just kept sounding like a worse deal for all the parties (including the partners in the venture with WBD losing those aforementioned NBA rights). Meanwhile, Disney/ESPN have seemingly kept on hedging the bet along the way.
In a way, this judge may be doing these companies a favor in that it will save some face if they now never launch what seems like it would have flopped out of the gate.