Disney's Hulu + Live TV and sports streaming service Fubo are combining in a deal that will also see the settlement of a lawsuit against the creation of Venu Sports. Fubo and Hulu + Live TV both allow customers to stream live broadcast and cable networks on their connected TVs,

Fubo will be combined with Hulu's live TV service and offer a new streaming package with ABC and ESPN channels.

In a surprising deal announced on Monday, Disney is set to combine its Hulu Live TV business with Fubo, the live TV streaming service known for its extensive sports coverage. Under the terms of the deal, Disney will own about 70% of Fubo, which will continue to be available to viewers as a separate offering.

Disney and FuboTV on Monday announced a planned merging of Hulu Live + TV and Fubo. Disney will have a 70% ownership stake in Fubo when the deal closes.

Fubo and the Disney-owned Hulu Plus Live TV services will be merging their live TV streaming operations, both companies announced on Monday. The Walt Disney Co. will become the majority stakeholder of the combined business, with the joint service working under Fubo's brand name.

Disney announced a deal with pay-TV provider Fubo to combine Hulu + Live TV with Fubo's operations in a joint venture, ending Fubo's Venu lawsuit.

Walt Disney Co said on Monday it would merge its Hulu + Live TV business with smaller rival FuboTV , removing a significant hurdle to the launch of its sports streaming venture with Fox Corp and Warner Bros Discovery .

The launch of sports streamer Venu, "and potentially new packages from Fubo, appears to be an important strategic lever to cast a wider net and catch all potential subscribers," says one Disney analyst.

These benefits are all hypothetical for now, but any attempt by Fubo and Disney to take on YouTube TV has to mean good things for subscribers: the two streaming services will naturally need to get more competitive to win over YouTube TV subscribers, be it by bolstering the channel list, reducing the price or improving the user experience.

Former competitors Hulu + Live TV and Fubo will still be offered to consumers separately, but will now be traded together publicly under the Fubo name. Disney will control 70% of the venture, but it will be run by Fubo CEO and co-founder David Gandler.

Disney will merge its Hulu + Live TV virtual MVPD with competitor Fubo, expanding its sports-focused distribution while settling a suit over skinny bundle Venu.