Foxtel is “reviewing the pricing of its various programming packages, including potential price increases for certain tiers” according to documents lodged with the ASX as it seeks refinancing for Foxtel debt totalling $US1.68 billion.
The Sydney Morning Herald reports the pay TV giant made a financial loss of $417 million in 2018.
EBITDA fell $US29 million in the quarter, compared with the same quarter last year, to $US98 million.
Most of that fall, about $US25 million, was because of rising sports rights and production costs related to cricket coverage, according to News Corp.
The company has flagged a cut to its spending on “non-marquee sporting content.” Yesterday it dropped two NRL entertainment sports shows, Queenslanders Only and The Greatest, but added The Matty Johns Podcast. Meanwhile media sources believe rights to Super Rugby and Wallabies tests, which expire in 2020, and soccer’s A-League competition, could be among codes impacted.
By the end of the three months to March, total Foxtel subscribers, including Kayo and Foxtel Now, were 2.896 million. Those numbers are bound to boost from April with the return of Game of Thrones. Following a strong start for Kayo Sports, News Corp’s chief financial officer, Susan Panuccio, said sports broadcast churn was just 6 per cent in the quarter. Overall broadcast subscriber churn increased to 17.7 per cent in the quarter, up from 15.6 per cent in the December quarter.
“The strategy is to strengthen the core which we’re going hard on,” CEO Patrick Delany said. “We’re getting back the trust of our customers, giving them more value, making sure they’ve got much better equipment to find our content, invest in the content – that’s big.”
In 2017 Foxtel was granted $30m from the Turnbull government for women’s sports, but it was a move questioned by observers and political opponents.
A News Corp spokesperson said: “We are proud of our commitment to supporting women in sport – both on air and on the field – and will continue to do so.”
Last week, it emerged News Corp, which owns 65 per cent of Foxtel, handed the pay TV subsidiary a $300 million lifeline to cover debts maturing in April. Telstra, which owns the remaining 35 per cent, did not put any money in.
Foxtel last raised prices in September last year.