Money News Corp chief backs Foxtel despite subscription revenue fall

07:31  10 august  2018
07:31  10 august  2018 Source:   msn.com

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Despite subscription surges for largest U.S. newspapers , circulation and revenue fall for industry overall. This is nearly a third of what it was just 10 years ago: In 2006, the Newspaper Association of America, now known as the News Media Alliance, put total industry ad revenue at billion.

" News Corp is now a more substantial company after the Foxtel transaction, with a much higher percentage of recurring, subscription -based revenues , which should help offset a volatile advertising environment," said News Corp Chief Executive Robert Thomson in a written statement.

Foxtel has kept subscriber figures steady at 2.8 million.© Bloomberg Foxtel has kept subscriber figures steady at 2.8 million. News Corporation chief executive Robert Thomson has thrown his support behind Foxtel’s subscription model, which has stemmed a decline in subscribers while reporting a $US33 million ($44.7 million) revenue hit in the last quarter of fiscal 2018.

The Australian pay-TV platform had 2.8 million subscribers by June 30, driven by streaming offering Foxtel Now. In June 2017, Foxtel reported having 2.8 million subscribers - down from 2.9 million in June 2016 - partly due to the closure of Presto.

Telstra and News Corp merged Fox Sports, formerly 100 per cent News Corp owned, and joint-venture Foxtel in April. News Corp now owns 65 per cent of Foxtel.

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" News Corp is now a more substantial company after the Foxtel transaction, with a much higher percentage of recurring, subscription -based revenues , which should help offset a volatile advertising environment," said News Corp Chief Executive Robert Thomson in a written statement.

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Mr Thomson said, in a statement, the “new Foxtel is focused on product innovation and leveraging its valuable content”.

“News Corp is now a more substantial company after the Foxtel transaction, with a much higher percentage of recurring, subscription-based revenues, which should help offset a volatile advertising environment,” Mr Thomson said.

The net loss for News Corporation over the quarter was $US355 million, compared to $US424 million in the same quarter in 2017, predominantly due to a $US337 million impact from combining Fox Sports and Foxtel.

Foxtel boss Patrick Delany, who took the reins in January in place of former chief executive Peter Tonagh, has talked up his plans to regain subscribers after the pay-TV platform shed customers for the first time in fiscal 2017.

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" News Corp is now a more substantial company after the Foxtel transaction, with a much higher percentage of recurring, subscription -based revenues , which should help offset a volatile advertising environment," said News Corp Chief Executive Robert Thomson in a written statement.

" News Corp is now a more substantial company after the Foxtel transaction, with a much higher percentage of recurring, subscription -based revenues , which should help offset a volatile advertising environment," said News Corp Chief Executive Robert Thomson in a written statement.

Mr Thomson reiterated plans to introduce an over-the-top streaming service in late-2018, and noted the recent acquisition of cricket rights ensured a "year-round offering for the first time" that would help reduce seasonable subscriber churn.

"For Foxtel we are confident that the current phase of investment in rights and tech should drive increased subscriptions," he said.

Foxtel’s revenues dropped $US33 million in the three months to June 30, “primarily due to lower subscription revenues at Foxtel, due to subscriber mix, and lower advertising revenues, partially offset by the positive impact from currency fluctuations”, a note to investors says.

Earnings (before interest, tax, depreciation and amortisation) over the three months was down 39 per cent compared to the same time in 2017 due to the revenue hit, increasing programming costs for major sports and $US10 million in additional transition costs.

Residential customer churn for cable and satellite was down over the quarter from 13.3 per cent to 12.5 per cent, while average revenue per customer declined 3 per cent over the same period.

News Corp Australia reported growth in digital advertising revenues, however overall revenue was down 3 per cent over the quarter. The collective mastheads had 415,600 digital subscribers by the end of June, compared to 363,600 at the same time in 2017.

The "new Foxtel" was expected to work closely with the news titles, Mr Thomson said, which are seen as an "important vehicle for subscriber growth".

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