Rising profits, revenue and subs signal Foxtel’s growing threat to free TV
Pay TV service Foxtel is now in nearly 1.6m Australian households, the company said in a financial update today.
And in a sign of the platform’s growing challenge to free TV, the company said one-third of its subscribers have Foxtel IQ digital video recorder, while among new subscribers the number leaps to two thirds.
As well as pausing live television, the device poses a major challenge to brands that want consumers to watch their advertising rather than fast forwarding through it. Commentators have also suggested that it offers TV viewers better technology than that likely to be offered by Freeview or the Seven-backed Tivo device.
The company said that it made a profit of $196m in the six months to the end of the year – up 19% on the same period 12 months before.
Although there was not as much detail in the update as in many of the results relesased this week – Foxtel is not ASX listed as it is jointly owned by Telstra (50%), News Corp (25%) and CMH (25%) – the numbers suggest that the company may be taking more money out of the TV advertising market too. Revenue during the period was $908m, of which $762 was subscription revenue . However, its “other revenues”, including advertising, rose by 26% to $145m.
The company also said that annual churn – the number of subscribers cancelling subscriptions – was 13.3%, slightly down on the previous period.
Further analysis from Stephen Bartholomeusz of Business Spectator can be found here.
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Are you sure you don’t mean that iQ penetration is one third, while penetration for new subs is two thirds?
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Thanks, EL. My bad – now corrected.