Fox's Direct-to-Consumer Streaming Service to Enter Competitive Marketplace
Fox Corporation (FOXA) has announced plans to launch a direct-to-consumer streaming service by year-end. This move aligns with the industry's shift towards streaming over traditional cable subscriptions.
Despite recognizing the value of cable bundles, Fox CEO Lachlan Murdoch emphasized the importance of reaching consumers on all platforms. The new service aims to cater specifically to "cord-cutters" and "cord-nevers."
Analysts have acknowledged Fox's heavy reliance on linear pay TV in a market where streaming services are gaining popularity. To address this, the company will price its streaming service competitively, focusing on customer acquisition rather than converting traditional cable subscribers.
Other legacy media players like Warner Bros. Discovery (WBD) are also investing in streaming. WBD plans to revamp its network with a $70 million investment, including a direct-to-consumer product.
Fox's announcement follows the discontinuation of Venu Sports, a joint venture with WBD and Disney (DIS). Regulatory concerns led to the abandonment of this sports streaming service.
Fox reported strong financial results in its fiscal second quarter, driven by election spending and sporting events. The upcoming Super Bowl LIX is expected to further boost its shares.
As the streaming landscape continues to evolve, Fox's direct-to-consumer service positions the company strategically to capture a growing market.