Townsville Bulletin

Streaming switch pays off for Foxtel

- JAMES MADDEN

THE Foxtel Group has outlined an ambitious growth strategy as the media company continues its transition to a streaming-led future.

Briefing investors at the Foxtel Group’s strategy day, the company’s chief executive Patrick Delany said the developmen­t of streaming services Kayo Sports, Binge and the soon-to-launch Flash represente­d a dramatic pivot in the evolution of subscripti­on TV in Australia.

“Our strategy briefing highlights today’s Foxtel Group is a very different company to the one-product Fox

tel of three or four years ago,” Mr Delany said. “The business has been reposition­ed as a technology-led streaming company with multiple sources of revenue growth from streaming, a strengthen­ed Foxtel Retail offering and growth in digital advertisin­g.”

Mr Delany said the company was on track to reach more than five million subscriber­s and $3bn in annual revenue within the next three years, with the cornerston­e of the business being “growth through streaming, and to win with world-class content and technology”.

“Importantl­y, we have high cash generation, sup

porting investment and returns,” Mr Delany said.

Responding to speculatio­n surroundin­g a Foxtel IPO, Mr Delany said it was “a matter for our shareholde­rs”.

“We want to make sure the investment community understand­s the value that we have delivered and the transforma­tive journey that we are on,” he said. Asked what the company might look like in three years, Mr Delany said: “We’ve got to go where our consumers want to go.”

Mr Delany spoke of the company’s ongoing investment in technology, which was highlighte­d by the recent introducti­on of the cable-less

iq5 plug-and-play IP set top box. This transition will be further developed in coming months with a software update that will allow the iq4 set top box to be Ip-only, without the need for satellite.

Foxtel’s chief financial officer Stuart Hutton said Foxtel’s transforma­tion would continue to “ease the capex burden” on the company – as more Australian­s shift to streaming, installati­on costs per subscriber are falling sharply, which reduces capital costs and boosts cashflow.

Mr Delany also revealed that 53 per cent of Foxtel’s subscriber­s have signed up to the company’s streaming ser

vices, and that number is on an upward trajectory.

Morningsta­r analyst Brian Han said Foxtel’s perceptual value had increased dramatical­ly with its pivot towards streaming services. “What the move into streaming has done is announce to investors ‘Do not mistake us for a onetrick pony’,” Mr Han said.

“The company is heading in the same direction as the technologi­es, and is positionin­g itself as a multi-platform sports and entertainm­ent provider of the modern day.”

Foxtel is 65 per cent owned by News Corp, publisher of this newspaper, and 35 per cent owned by Telstra.

 ?? ?? CEO Patrick Delany said Foxtel was on track to reach more than five million subscriber­s and $3bn in annual revenue within the next three years.
CEO Patrick Delany said Foxtel was on track to reach more than five million subscriber­s and $3bn in annual revenue within the next three years.

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