Foxtel’s Kayo Sports hits 100,000 paying subscribers
News Corp chief executive Robert Thomson has revealed that newly launched subscription sports platform Kayo Sports has reached 100,000 paying subscribers after the summer cricket period, compared to 2.9 million at Foxtel.
Mr Thomson said the sports streaming platform had attracted 115,000 subscribers as of February 5, including 100,000 paying subscribers, as he presented News Corp’s results for the second quarter of the 2019 financial year.
The overall Foxtel figure was described as higher than the previous quarter, when it was also reported as being about 2.9 million.
Foxtel’s Kayo was launched in late November ahead of the cricket, which Foxtel and Seven West Media bought the broadcast rights for in a joint $1.2 billion deal last year. Foxtel secured the digital rights allowing cricket to be streamed over Kayo.
News Corp’s pay-TV arm is under scrutiny over whether the new Kayo platform will see existing Foxtel subscribers, who pay higher prices, switching over to the cheaper streaming platform. Out of the 2.9 million Foxtel subscribers, 2.5 million were broadcast and commercial, with the remaining 400,000 accessing the content via on-demand app Foxtel Now and Kayo Sports.
“Within our subscription video services segment, this quarter we launched Kayo Sports, a sports-only [over the top] product, to positive reviews, and we look forward, with confidence, to the peak selling season for the most popular winter sports in Australia,” Mr Thomson said in a statement.
Kayo is priced at $25 a month, though until Monday this week the platform offered a promotion to get one month for $5.
A sport pack subscription on Foxtel comes at a minimum $54 a month (with a mandatory entertainment or lifestyle package).
Churn rose from 14.5 per cent the year before to 15.6 per cent, which News Corp said was due to a price increase in October.
Mr Thomson said during the earnings call subscribers had been "rising week after week in the two months since we launched”.
“Indeed we are on the cusp of the peak sports selling season, which is Aussie Rules and Rugby League. It is beyond clear that sports events are crucially important in an age of confected, concocted content and we have the events that matter in Australia for the next four or so years,” he said.
Rupert Murdoch’s publishing company reported $2.63 billion in total revenue for the quarter, up 21 per cent year on year bolstered by the merger of Foxtel with Fox Sports and strong results in real estate and publishing.
“News Corp has reported increased profitability and revenue growth during the first half of fiscal 2019, highlighting the power of premium content and authenticated audiences in a fact-challenged world that craves credibility," Mr Thomson said in a statement.
Subscriptions have become increasingly important for media companies looking to find a new way to improve revenues as advertising heads online.
"At news and information Services, we saw a continuation of positive trends in paid digital subscriptions, including accelerating gains at The Wall Street Journal, and stronger digital advertising revenues in both the US and Australia," he said.