Fox Prepares to Join Streaming Landscape with Direct-to-Consumer Service
Fox Corporation (FOXA) is stepping into the competitive streaming arena with the launch of an exclusive direct-to-consumer service slated for later this year. This announcement marks a strategic move to cater to the growing segment of "cord-cutters" and "cord-nevers" embracing streaming services over traditional cable subscriptions.
Analysts note that Fox's assets have traditionally focused on linear pay TV, but the company recognizes the need to adapt to the streaming transition and reach consumers on various platforms. Fox's CEO, Lachlan Murdoch, emphasized that the service will target a modest subscriber base and be priced accordingly.
"Our traditional distribution customers are not our target audience for direct-to-consumer offerings," Murdoch stated.
The streaming service announcement follows the dissolution of Venu Sports, a prior sports streaming venture involving Fox, Warner Bros. Discovery (WBD), and ESPN (DIS). Fox expressed disappointment over the abandonment of Venu, citing regulatory and antitrust concerns.
Fox's recent financial performance has been robust, exceeding expectations in revenue, adjusted EBITDA, and adjusted earnings per share. The upcoming Super Bowl LIX, airing on Fox, is anticipated to further boost the company's stock value, with reports indicating the sale of 30-second ad slots for over $8 million.
Fox's entry into the streaming market reflects the ongoing transformation within the media industry as traditional legacy players adapt to evolving consumer preferences. The company's direct-to-consumer service aims to provide a compelling offering that meets the evolving needs of the streaming audience.