Rupert Murdoch’s Fox Corp. has largely stayed on the sidelines of the streaming wars.
That ends next week.
Fox, which owns the most-watched cable news channel Fox News and has TV rights to major sporting events such as the NFL and MLB post-season baseball, has remained committed to the declining pay TV business.
But with 65 million households no longer hooked up to cable or satellite services, the company making its channels available to non-pay TV customers for the first time with Fox One, a new streaming platform that will launch Aug. 21.
“There is a growing audience outside of cable,” said Pete Distad, chief executive of direct-to-consumer for Fox Corp., who previewed the service Thursday at a press briefing at the company’s New York headquarters. “We need to give to give those cord-cutters and cord-nevers access to our content.”
For $19.99 a month, Fox One will provide subscribers with their local Fox TV affiliate that carries a package of NFL games, plus two Fox Sports cable channels. A full year subscription will cost $199.
Fox One will also carry Fox News Media’s channels, which include Fox News, Fox Weather and Fox Business. It will provide replays of Fox programming on demand, with access to current seasons of entertainment programs and DVR capabilities with unlimited storage.
But the main selling point of Fox One will be the company’s array of live events, which include next year’s FIFA World Cup. The service will be promoted with the marketing tag line, “We Live For Live.”
Sports is the driver for the service. Fox Corp. and Walt Disney Co. have already agreed to offer a package deal for Fox One and the upcoming ESPN direct-to-consumer service also launching next week, for $39.99 a month, a savings of $10. ESPN will charge subscribers $29.99 on its own.
Distad said his company will look at more opportunities to bundle Fox One with other streaming services.
Until now, Fox’s biggest investment in streaming was the acquisition of Tubi, an ad-supported free streaming service that has grown to capture 1% of all U.S. TV viewing according to Nielsen.
Fox Corp. sold its TV and movie studio assets to Disney in 2019, partly because the company did not believe it could compete with deep-pocketed tech firms such as Amazon and Apple, which have spent freely on producing content for their streaming platforms.
But Amazon and Netflix — which acquired NFL rights in recent years — have shown that they can draw large audiences for live sports events, an area where Fox Corp. is already deeply entrenched.
The real test for the new streaming product will be the appetite for Fox News. The conservative-leaning news channel dominates its competitors in the TV ratings. Whether consumers who have cut the cable cord will be willing to pay to stream the channel’s live feed is an open question.
“Nobody knows how many news fans are outside of the pay TV universe,” Distad said.
Distad is encouraged by the reach of Fox News content online after it airs live on the TV network. Fox News scored 1.5 billion views on YouTube and 3.7 billion views on social media platforms in the last quarter.
Fox News Media’s existing streaming channel, Fox Nation, will be offered as a $5 add-on for Fox One for a total of $24.99 a month. The service has documentaries, true crime shows and movies that appeal to the Fox News audience.
Fox Corp. executives are keeping their expectations low. It’s priced high enough so that the consumer who is currently happy with their current cable TV subscription is not likely to cancel.
But Distad said profit projections are “aggressive” as the platform will not spend money to create original programming. All of the content is being provided from its existing networks.
Investment in original programming has been the main obstacle to profitability for the streaming services that have proliferated in recent years.
Distad said the company is considering putting podcasts on the Fox One platform. Fox Corp. company recently acquired Red Seat Ventures, a media company that specializes in providing business support and technical services for right-leaning podcasts.
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