Rupert Murdoch’s News Corp could sell its Australian pay-TV operator Foxtel Group.
At the end of a commentary for what News Corp CEO Robert Thompson called an “outstanding” year financially for Murdoch’s news operation was the reveal there had been outside interest in Foxtel, which has more than four million subscribers in Australia overall and owns the likes of Colin From Accounts streamer Binge.
Thompson said a review of the News Corp business had “coincided recently with third-party interest in a potential transaction involving the Foxtel Group, which has been positively transformed in recent years. We are evaluating options for the business with our advisors in light of that external interest.”
He later called the approach a “vote of confidence” in Foxtel’s management.
Foxtel has been a dominant presence in Australian media for decades, but has come under pressure from the likes of Netflix, Prime Video, Stan and Disney+ in a very competitive local streaming market, as the number of traditional pay-TV boxset subs continues to fall.
Binge had 1.55 million subs as of June 30, according to News Corp’s fourth quarter results announced yesterday, while sports streamer Kayo had 1.61 million. Foxtel television subscribers (not including commercial subs) came in at 1.21 million, down from 1.34 million a year before. Though streaming has stemmed a fall in subscriber numbers over all, traditional pay-TV is still brings in the lion’s share of revenue made from subs — the same scenario pay-TV services are facing around the world.
Foxtel CEO Patrick Delany acknowledged the approach during News Corp’s earnings call, but added: “We’re used to speculation about us. In the early days, 2017-18 it was that we weren’t going to make it. Then there was the flotation stuff, and then this… We just keep our heads down and continue on.”
News Corp largely only houses Murdoch’s publishing assets such as Dow Jones, News UK and HarperCollins, but has always owned a majority stake in Foxtel. The pay-TV service was formed back in 1995 as a partnership with telco Telstra, which remains a minority shareholder.
Along with a pay-TV service, Foxtel owns brans such as recently-launched OTT service Hubbl, Kayo, Binge, Australian news service Flash and Fox Sports Australia.
No figure has been put on a potential sale but it could well fetch over $1B, reports suggest.
News Corp reported revenue for the fourth quarter of $2.58B, up 6% year-on-year. Net income was $71M, up significantly on the $32M net loss the previous comparable quarter in 2023, while total segment EBITDA was $380M.
Murdoch housed all of its media interests within News Corp until June 2013, but then split them in two with the creation of 21st Century Fox. The sale of his entertainment business to Disney in March 2019 led to the creation of Fox Corp, which is parent to the Fox network and its production and distribution businesses.
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