The media industry has long been preparing for consolidation and mega deals. And yet Fox Corp.’s acquisition of Roku seems to have taken the market by surprise. 

On Monday, Fox said it would acquire Roku for $22 billion, bringing a streaming tech platform — in addition to a second free, ad-supported streaming service — into its portfolio of linear TV networks and Tubi. 

While analysts lauded the deal as a strategic pivot for the legacy media company, Fox shareholders received the news differently. Its stock traded down 16% on Monday, hitting a 52-week low. Shares fell another 4% on Tuesday. 

“We view this as a strategic fit. Fox marries its strong content with Roku’s leading distribution platform and first party data that add scale and can enhance the value proposition with advertisers,” Piper Sandler analyst Thomas Champion wrote in a note on Monday. 

Champion highlighted Fox’s long list of sports rights and Roku’s position as the leading streaming platform — offered on both dedicated devices and smart TVs — as “highly complementary.” 

“The combined company will be the third largest player in the U.S. by share of viewing, spanning broadcast, cable, local and streaming,” he said.

Some industry analysts and insiders — who didn’t want to comment publicly on market reaction — attributed the sharp stock reaction to the new debt that Fox would be taking on as part of the deal. Still, the company’s leverage will be relatively low after the deal’s expected close in the first half of next year.

One industry insider noted that Fox is also likely to spend more when the NFL reopens media rights negotiations, which have already begun for CBS owner Paramount Skydance. 

Mike Proulx, Forrester’s vice president and research director, told CNBC in an email that it was too early to take this as a negative market reaction and noted that big media deals “often get punished in the short term because they introduce uncertainty.”

“In this case investors are likely questioning the near-term cost-benefit. But what the market is missing is the long-term strategic importance of this deal. It’s a must for Fox,” Proulx said. “It’s far from just a content play. The long-term value is in owning the platform, the data, and the ad stack. That’s what this deal gives Fox and helps the company to future proof.”

Among the live sports and entertainment shows that carried media companies’ presentations to advertisers this week, another pitch kept popping up: creator content.

The category of videos, which can amass millions of views on Google’s YouTube and other social media platforms, is increasingly sharing the stage with traditional Hollywood offerings during the annual presentations known as “upfronts.”

Creator content is already taking a big share of advertiser dollars. In 2025, advertiser spending on the genre reached $37 billion, according to a recent report from the Interactive Advertising Bureau. This year, it’s expected to reach $44 billion, the report found.

“They are this generation’s storytellers, tastemakers and stars, producing the most relevant and engaging programming on the planet,” said Brian Albert, managing director of YouTube Solutions. “And advertisers have recognized that they don’t just have large audiences, they have communities that trust them. It’s why they want to partner with them now, more so than ever.”

The shift to streaming over traditional TV has led sports, especially the NFL, as well as live events to beckon the highest ad rates — especially when media companies are paying hefty premiums for the live rights.

With streaming, however, advertisers get more bang for their buck, industry executives have told CNBC. That’s true whether it’s a simulcast sporting event on streaming platforms or the exclusive rights to video podcasts or children’s programs like “Ms. Rachel.”

Those economics — combined with the need to capture elusive, younger audiences — are spurring demand for ad-supported inventory, and opening the door to more creator-led content on traditional platforms.

YouTube claims the biggest share of streaming viewership, per Nielsen‘s monthly reports known as “The Gauge.” As of February, the platform accounted for 12.7% of streaming viewership, with Netflix coming in second at 8.4%.

The company hosted its pitch to advertisers — what it calls its Brandcast — on Wednesday, featuring personalities like YouTuber Jesse “Jesser” Riedel, comedian Trevor Noah and podcast host Alex Cooper.

While digital stars are commonplace in YouTube’s realm, this year they played a larger role even at traditional media and streaming companies. Warner Bros. Discovery, Fox Corp. and Amazon’s Prime Video were among the companies that noted the integration of creator content on their platforms.

“Where there used to be a distinct difference between studio-led content and creator content, it’s merging into a singular view,” said Julie Clark, longtime ad industry executive and senior vice president of media and entertainment at TransUnion.

“If you look at the rise of things like long-form video podcasts, to quick-hitting tutorials, there is an understanding that the content landscape has shifted dramatically,” she added. “This is absolutely changing how upfronts are contemplated and activated.”

Fox has similarly found an entry point into the creator ecosystem via food. Earlier this year, the company launched Fox Creator Studios, with a focus on food content. The effort is led by chefs already on the Fox roster, including Gordon Ramsay.

Ramsay took the stage of Fox’s upfront pitch on Monday, alongside NFL legend Tom Brady and stars of network entertainment shows, to tout his series on Fox and the Creator Studios.

Fox has focused much of it streaming effort on its free, ad-supported service, Tubi, which has been inking agreements with YouTube personalities to create content specifically for the streamer. In turn, those creators are bringing their followings over from the social media platform.

In particular, Tubi has attracted the Gen Z audience, a key demographic for advertisers looking to reach younger consumers who don’t tune into traditional media outlets as often. The Fox-owned streamer also launched Tubi for Creators, and has been looking to provide creators a pathway to Hollywood, CNBC previously reported.

Tubi hosted its own presentation for advertisers in late March, ushering creators onto the stage, including YouTube’s Jesser.

The platform has since announced various creator-led partnerships, including an exclusive soccer-focused series led by Jesser that premiered on Friday.

Google-owned YouTube on Monday said it may remove channels including Fox Broadcast Network, Fox News and Fox Sports from its TV streaming platform if it doesn’t reach an agreement with Fox Corporation.

YouTube TV’s renewal date with Fox is coming on Wednesday, and while the two companies have been in ongoing negotiations, they’ve been unable to reach a deal, the YouTube team wrote in a blog post. The company also emailed YouTube TV subscribers about the potential fall out with Fox.

“Fox is asking for payments that are far higher than what partners with comparable content offerings receive,” YouTube wrote in the blog. “Our priority is to reach a deal that reflects the value of their content and is fair for both sides without passing on additional costs to our subscribers.”

If YouTube is unable to reach a new agreement by 5 p.m. Eastern on Wednesday, the Fox channels will become unable on YouTube TV, the Google company said. YouTube pays broadcasters like Fox to carry their channels, and a blackout could have implications on advertisers and millions of viewers who cut their cords to stream Fox’s various channels on YouTube TV.

“While Fox remains committed to reaching a fair agreement with Google’s YouTube TV, we are disappointed that Google continually exploits its outsized influence by proposing terms that are out of step with the marketplace,” the media company said in a statement.

The Fox standoff represents the latest contract dispute between content companies and delivery networks as viewers increasingly ditch cable. 

In February, Paramount Global notified YouTube TV subscribers that more than 20 channels including CBS, BET, Comedy Central, MTV and Nickelodeon could go dark on the service if the two didn’t reach a deal. Shortly after, YouTube TV and Paramount announced a multi-year distribution deal.

YouTube TV’s base plan costs $82.99 per month and includes over 100 live channels and unlimited cloud DVR. YouTube said a key part of its commitment to users is its partnership with content providers like Fox, “which allows us to carry a wide variety of channels.”

If Fox does go offline for an extended period of time, YouTube will give its members a $10 credit, the Google company wrote. Users will also be able to watch Fox content by signing up for Fox One, Fox’s streaming service, the blog said.

YouTube recently overtook Netflix, which has a market cap of $515 billion, as the top streaming platform in terms of audience engagement. Google does not provide official subscriber numbers for YouTube TV, but in its February 2024 letter, YouTube CEO Neal Mohan announced that the service had more than 8 million subscribers. MoffettNathanson principal analyst Michael Nathanson has estimated that YouTube TV has approximately 9.4 million paying subscribers.

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Gotham Advanced Media and Entertainment, the joint venture between MSG Networks and the YES Network, is launching a new app in the fall that will air local games for seven New York area teams.

The package announced Wednesday is believed to be the first time that two regional sports networks have combined their apps into a bundled option.

The Gotham Sports app will launch ahead of the NBA and NHL seasons. Locals will be able to watch the New York Knicks, New York Rangers, New Jersey Devils, New York Islanders, Buffalo Sabres, Brooklyn Nets and New York Yankees with a subscription.

The Gotham Package that gives access to all of those teams will cost $359.99 annually and $41.99 monthly, almost identical to the monthly price of Fox, Disney and Warner Bros. Discovery‘s joint Venu streaming service that was blocked with a temporary injunction earlier this month. 

Customers who watch only some of those teams can also purchase access to just MSG+ or the YES App services for $29.99 and $24.99 monthly, respectively. If they already have MSG Networks and YES Network via their pay-TV subscription, they will get Gotham Sports App’s services for no extra fee.

“With the increased fragmentation of outlets carrying fan favorite sports programming, The Gotham Sports App allows fans of our teams one easy access point for New York area sporting events from MSG Networks and the YES Network,” MSG Networks President and CEO Andrea Greenberg said in a press release.

Notably, SportsNet New York — the regional sports network that airs the New York Mets — is not included in this joint venture. It is only available via FuboTV, DirecTV stream and online login for people who pay for cable. 

Sterling Entertainment Enterprises, Comcast and Charter co-own SportsNet New York.

The regional sports networks business has undergone dramatic changes in recent years. Boston’s local cable network that aired Red Sox and Bruins games launched the first stand-alone regional streaming service in 2022, and other markets have followed. 

Diamond Sports Group, the biggest owner of regional sports networks, filed for bankruptcy in March 2023, leading many professional teams across leagues to change the way they air their games.

A handful of NBA, WNBA and NHL teams have turned to local broadcasters, most recently the NBA’s New Orleans Pelicans and Dallas Mavericks.

Some MLB teams have opted to have their games produced by the league. 

The Gotham Sports App is not the first regional sports streaming option residents of the greater New York area have had. YES Network and MSG Networks both launched separate streaming services last year, and customers who only want one of the networks’ services and not the combined package can still pay a cheaper rate.

Not all the new regional sports streaming services follow the subscription model. The NHL’s Dallas Stars and Anaheim Ducks both announced their games would be locally aired on Victory+, a free, ad-supported streaming service owned by A Parent Media Co. 

Both teams previously had their local games carried by a regional sports network owned by Diamond Sports. 

Disclosure: Comcast is the parent company of CNBC.

Whether it’s two people in a marriage or a company and a sports league, it’s not easy to break up a 40-year partnership.

The NBA and Warner Bros. Discovery‘s Turner Sports have been in business together for nearly four decades. The relationship is now in jeopardy, as Comcast‘s NBCUniversal is attempting to steal away its package of games with a $2.5 billion per-year offer, as CNBC has previously reported.

The league ended its exclusive window to renew a deal with its two current media partners, Disney and Warner Bros. Discovery, on April 22. Since then, the league has set a framework to renew with Disney, bring in Amazon as a new third partner, and sell its other package to either Warner Bros. Discovery or NBCUniversal, according to people familiar with the matter. The league stands to triple the total value of a new deal from about $24 billion to $76 billion or more.

Warner Bros. Discovery continues to have discussions with the NBA about keeping the rights, according to people familiar with the matter. The league could still decide to simply renew with its incumbent partner, but it’s not likely, said two of the people, who asked not to be named because the talks are private.

The more probable path would be for the league to sign papers with NBCUniversal, formally securing its bid. That would trigger a contractual option for Warner Bros. Discovery to match the offer.

This is where things might get thorny.

Both the NBA and Warner Bros. Discovery have begun poring over legal language to determine if the league can reject a potential match, the people said. The contractual wording is vague, and it’s unclear if the NBA has full discretion to walk away from Warner Bros. Discovery if it matches the bid, said the people.

If Warner Bros. Discovery decides to match, and the NBA moves to choose NBCUniversal’s offer, the sides may be headed for a lawsuit. Warner Bros. Discovery believes it’s fairly well protected by the contractual language, one of the people said.

Still, that remains hypothetical at this point. It’s possible Warner Bros. Discovery won’t match NBCUniversal’s bid, which would avoid potential conflict.

Some league officials are worried Warner Bros. Discovery’s balance sheet can’t handle spending $2.5 billion a year on the NBA, according to people familiar with the matter. Warner Bros. Discovery has a market valuation of about $20 billion and an enterprise value of about $60 billion, including $43.2 billion of gross debt, as of the end of the company’s fiscal first quarter. The company had a leverage ratio (net debt to adjusted earnings before interest, taxes, depreciation and amortization) of 4.1.

Warner Bros. Discovery CEO David Zaslav has both publicly and privately preached the importance of financial discipline for the company.

NBCUniversal parent Comcast has a market capitalization of about $154 billion and an enterprise value of $244 billion. Comcast’s leverage ratio is about 2.5.

NBA officials are more comfortable Comcast can pay what would amount to more than double the previous price for the package, according to the people familiar to the matter.

Warner Bros. Discovery had been paying $1.2 billion per year to air NBA games. The new package also includes fewer games than the current one because the NBA is likely to introduce a third partner — most likely to be Amazon.

Spokespeople for Warner Bros. Discovery and the NBA declined to comment.

Warner Bros. Discovery, Disney and Fox announced Thursday they plan to name their new sports streaming platform Venu, taking inspiration from where live sports are played. The new joint venture, one-third owned by each media company, will offer a bundle of sports networks and ESPN+ at a still to be determined price that’s less expensive than traditional cable. CNBC reported earlier this year the price could be around $45 or $50 a month. The service will debut in the fall, the companies have said.

The three companies haven’t yet formally signed paperwork on the venture as they await regulatory approval. If Warner Bros. Discovery loses the NBA, that will diminish the value of the service for consumers, as NBCUniversal and Amazon aren’t partners in the product.

Warner Bros. Discovery licenses the rights to other sports leagues and groups, including MLB, the NHL and the National Collegiate Athletic Association’s March Madness. The company will also have the NBA next year no matter what, as the new rights deal doesn’t kick in until the end of the 2024-25 season.

There’s been no discussion about shutting down the venture before it launches if Warner Bros. Discovery loses the NBA, according to a person familiar with the matter. Still, without the NBA, Disney and Fox would be contributing the lion’s share of sports content for the service. Disney’s ESPN and Fox own both college football and NFL packages, unlike Warner Bros. Discovery. The three companies plan to split revenue commensurate with the affiliate fees associated with their linear networks.

Warner Bros. Discovery could use the money it saves from not obtaining NBA rights to spend on other sports, such as more MLB games or bidding for UFC, which will likely begin renewal discussions with media companies in early 2025.

ESPN plans to launch its own “flagship” streaming service in the fall of 2025.

Disclosure: Comcast’s NBCUniversal is the parent company of CNBC.

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Sports streaming platform FuboTV is suing Disney, Fox and Warner Bros. Discovery over their recently announced joint venture, citing what the company calls “extreme suppression of competition in the U.S. sports-focused streaming market,” according to a copy of the lawsuit obtained by CNBC.

The joint venture, announced earlier this month, aims to offer viewers a new way to access marquee live sports. It’s slated to roll out this fall, but several questions remain around its pricing and structure.

“These horizontal competitors are colluding to create a JV that will cause substantial harm to competition and consumers,” the complaint says.

The lawsuit also names Disney-owned ESPN and Hulu as defendants.

“Each of these companies has consistently engaged in anticompetitive practices that aim to monopolize the market, stifle any form of competition, create higher pricing for subscribers and cheat consumers from deserved choice,” FuboTV CEO David Gandler said in a statement. “By joining together to exclusively reserve the rights to distribute a specialized live sports package, we believe these corporations are erecting insurmountable barriers that will effectively block any new competitors from entering the market.”

A spokesperson for the joint venture declined to comment.

Fubo argues that Disney, Fox and Warner Bros., which control a significant portion of live sports content in the U.S., imposed bundling requirements and “significantly above-market licensing fees” on Fubo, inflating prices for consumers.

Now, their new joint venture allows the media companies to undercut those prices and avoid the same restrictions on which channels they have to carry, granting them a competitive edge, the lawsuit alleges.

As recently as last week, the joint venture was raising eyebrows in the traditional pay-TV market, with leaders of major distributors privately voicing concerns that the new skinny bundle would drive up cable TV cancellations, CNBC’s Alex Sherman reported.

Craig Moffett, an analyst at MoffettNathanson, said at the time that antitrust challenges were likely.

Local TV station owners including Sinclair, TEGNA and EW Scripps all saw their valuations plummet this week after Disney, Warner Bros. Discovery and Fox announced a new sports joint venture set to launch this fall.

Sinclair dropped 12% Wednesday, TEGNA fell 7.2% and Scripps plummeted 24% as investors weighed the meaning of a new, skinnier cable bundle of sports networks that will include ESPN, TNT and Fox but will leave out CBS and NBC. Sinclair bounced back by rising 7% Thursday, but TEGNA and Scripps were little changed.

But Wall Street’s reaction is overblown, according to EW Scripps CEO Adam Symson.

For one, investors appear to be pricing in that local ABC and Fox affiliates wouldn’t be part of the new skinnier bundle, Symson told CNBC in an interview. They will be included, he said, citing assurances he’s been given in conversations with Disney executives. Scripps owns 18 ABC stations, in markets such as Phoenix, Detroit, Cleveland and Tampa, and 4 Fox stations.

“Affiliates are going to be compensated for being carried along,” Symson said.

The joint venture will work collaboratively with all local broadcast affiliate partners in a similar manner to other digital multichannel bundlers, such as YouTube TV and Hulu with Live TV, according to a person familiar with the matter, who asked not to be named because the discussions are private.

This means consumers of the new bundle will be able to get their local news and sports from ABC and Fox.

A spokesperson for the joint venture declined to comment.

FuboTV, another sports-focused bundle of networks, has yet to reach 2 million subscribers — and it offers more sports than the new bundle is likely.

A smaller bundle at a price of $40 or $50 per month probably won’t have a large audience either, said Symson.

“If you’re a sports nut today and you need access to all the live telecasts of your favorite sports, you’re best off maintaining the pay TV bundle as it is,” he said. “It calls into question the value of the consumer proposition.”

Even if Disney and Warner Bros. Discovery are able to juice subscriber additions by bundling the new service with existing streaming services Disney+, Hulu and Max, he noted the service should be viewed by investors as supportive of broadcast stations.

“If network affiliates like Scripps will be compensated for carriage on this platform like we are on other platforms, it’s potentially additive,” Symson said. “It’s just another product among products that are kind of already the same thing.”

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The U.S. media world was rushing — panicking? — Wednesday to try to figure out the ramifications of Disney, Warner Bros. Discovery and Fox‘s new joint venture, an unprecedented move to work together in the years since media companies broke out their own competing streaming platforms.

The service will launch this fall and cater to sports fans who don’t subscribe to the traditional cable bundle. Consumers will have access to all of the networks owned by those companies that carry sports, along with Disney’s ESPN+.

Some of the motivations for the companies are clear, as they look to sports to help drive streaming profits. Other reasons for launching the product are murkier and more company specific.

Many media executives are scrambling for answers about a deal that could have major ripple effects in the industry.

Fox Chief Executive Officer Lachlan Murdoch said Wednesday the product is geared toward people who have never signed up for cable. But it’s a leap of faith to assume a lot of these people want to spend $40 or so each month for live sports.

Spokespeople for Charter, Comcast and DirecTV all declined to comment on the new offering.

Charter and Comcast haven’t really cared about video defections for years now. Broadband is a far more profitable product. Cable TV has been relegated to an add-on that helps keep people subscribing to high-speed Internet.

But broadband subscriber growth has stalled for both Comcast and Charter as Verizon, T-Mobile and AT&T have rolled out 5G home and fixed wireless broadband products. That makes additional loss of video subscribers potentially more harmful for the companies.

Satellite TV providers DirecTV and Dish, which don’t have high-speed broadband products at all, are potentially more at risk. So are virtual distributors of linear networks, such as Google‘s YouTube TV, Fubo TV, and Hulu with Live TV (owned by Disney!).

The Disney, Warner Bros. and Fox service isn’t a full sports offering. It doesn’t include NBC or CBS, which both broadcast a lot of sports, including the all-important National Football League. Granted, NBC and CBS are free over the air with a digital antenna, and both offer streaming services (NBC’s Peacock and CBS’s Paramount+) that already include sports.

Still, the more consumers feel they need to add-on to this service, the greater the cost and hassle, and the less appealing it becomes.

And now that the joint venture exists, perhaps the distributors can also eventually get more flexibility to offer similar skinny bundles.

There’s another dynamic at play: ESPN is still planning to launch a full direct-to-consumer offering no later than next year. That product will also have an audience.

It remains to be seen just how many people subscribe to the new platform. Maybe it’s a game changer, maybe it’s not.

Traditional pay TV still has about 70 million subscribers. That includes so-called “virtual MVPDs,” like YouTube TV, which just announced it has more than 8 million subscribers.

The cable bundle has largely survived because it still contains exclusive live news and sports.

Now there’s a cheaper way to access most of the sports, and it doesn’t include cable news networks such as Fox News, CNN, MSNBC and CNBC. The shift could pose a threat to those channels, which are now at risk to lose subscribers.

Could the news networks gang up to offer a skinny news bundle, in a similar fashion to the new sports bundle? Or, will the new sports venture be a catalyst to news bundles, a concept CNBC has written about for many years, but hasn’t happened? Could Fox News bundle with other conservative-leaning publications? Could CNBC partner with the Wall Street Journal or the Financial Times to offer a print and video combination?

These are hypotheticals, but the sports package may force executives to think in new ways.

LightShed media analyst Rich Greenfield called the new sports platform “the Winners’ bundle.” To some degree, he has a point. Customers for this new platform will keep paying Disney, Warner Bros. Discovery and Fox for content, and they won’t be paying NBCUniversal and Paramount Global.

But it also brings risks for Warner Bros. Discovery and Disney.

Warner Bros. Discovery has unbundled TNT, TBS and TruTV from the rest of its networks with the skinny bundle. That may prompt pay TV distributors to demand they only pay for the same package, putting many of the old Discovery networks at risk, including HGTV, Animal Planet, TLC and Discovery Channel. These are low-cost, profitable channels for Warner Bros. Discovery.

Those that want the Discovery networks can always subscribe to Max. All the content is already there.

Fox faces less risk. Cable providers will probably still need Fox News to placate the network’s rabid fan base.

Disney’s flagship ESPN streaming service, whenever that launches, now feels muted by this new sports offering. Previously, the only way for cord cutters to get ESPN outside the cable bundle would have been that coming service. Now, the new platform will also give cord cutters a cheaper way to get ESPN.

The joint venture will require Disney to split revenue with two other companies. Disney’s direct-to-consumer offering is all Disney. The launch of the platform seems to be at best a hedge and at worst a critique of the potential popularity of an expensive ESPN-only streaming product.

One possible way Disney can add some juice to its own direct-to-consumer product is if the three-company sports platform comes with limited or no on-demand options. But if that’s true, it may decrease the appeal of the joint venture.