Why the Fubo/Hulu combination announcement is a big deal in sports media

In many ways, the press release announcing the transaction Monday was typical of the kind that pass through the business news wire on a weekly basis.

Fubo and Hulu + Live TV are combining into one entity. Disney, Hulu's parent company, will own the new business. For subscribers, Fubo and Hulu + Live TV will continue to exist as separate offerings once the transaction officially closes.

One line tucked into the press release stood out for those interested in the behind-the-scenes maneuverings in the sports media space: "In connection with the Transaction, Disney will enter into a new carriage agreement with Fubo that will allow Fubo to create a new Sports & Broadcast service, featuring Disney’s premier sports and broadcast networks including ABC, ESPN, ESPN2, ESPNU, SECN, ACCN, ESPNEWS, as well as ESPN+."

The quick upshot: ESPN+ is going to be part of your Hulu + Live TV and your Fubo bundles.

The longer-term picture is far more complicated. Consider first that Fubo won a court order in Aug. 2024 to temporarily block Disney from launching a competing sports streaming venture — Venu — that would bundle ESPN content with other sports programming from Fox and Warner Bros Discovery.

"We’re grateful for the support we’ve received from the DOJ and state AGs nationwide," Fubo CEO David Gandler said at the time. "Consumers deserve better: more choice, greater innovation, and fair pricing. Now more than ever, we stand confident in the merits of our case."

Now? All litigation between Disney and Fubo has been settled, according to Monday's press release. Gandler's management team will operate the newly combined Fubo and Hulu + Live TV businesses.

“We are thrilled to collaborate with Disney to create a consumer-first streaming company that combines the strengths of the Fubo and Hulu + Live TV brands,” Gandler said in a statement.

Why would two heretofore enemies team up on a new business venture?

Netflix, Amazon and Google.

As Andrew Marchand of The Athletic explained Monday: ESPN "first created a sports-rights moat by outlying nearly $80 billion over the past seven years for the NFL, NBA, college football and MLB, among other properties. Now, it wants to conquer distribution, which ESPN once dominated but now is being overrun by the Netflix, Amazon, Google and the like. ESPN once had 100 million cable and satellite subscribers and now has 65.3 million, according to Nielsen’s latest tally. The combined Fubo and Hulu + Live TV has 6.2 million subscribers and represents a legit competitor to YouTube TV’s platform that approaches 10 million subscribers."

Ostensibly, ESPN's solution to maintain its ubiquity in a post-cord-cutting world is to be available to as many streaming subscribers as possible. DirecTV Stream, Fubo, Hulu + Live TV, Sling TV, and YouTube TV all come with different price points. Venu, if it ever launches, will offer a competing price point of its own. (Fortune's Chris Morris wrote about the Fubo/Hulu transaction paving the way for Venu to finally launch.)

ESPN is also reportedly launching a flagship streaming service of its own. From 10,000 feet it's interesting to see the streaming economy increasingly mimic the cable/sattelite television economy it seeks to supplant, with different companies offering different bundles at differing price points. The technology underneath the hood is a different story, but the similar structures among the consumer-facing products is striking.

For sports fans, at least those loyal to the ESPN brand, the instinct to pick a winner in this behind-the-scenes game of thrones among streaming platforms might be moot. Whatever the future of distribution holds, ESPN might be the easiest channel to find.

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