Fox CEO Lachlan Murdoch hailed the media giant’s new streaming sports venture with Warner Bros. Discovery and Disney on Wednesday while also expressing a continued commitment to the company’s pay TV partners.
The joint venture is due to launch this fall and will shift the paradigm for sports on streaming, but an individual with knowledge told TheWrap it will also include all content from participating channels. So yes, the joint venture will include all sports that air on Fox, but also “Family Guy” and other originals that air live. Understandably, analysts were curious how this new platform will impact Fox’s pay TV strategy.
“The inclusion of our networks in the platform is consistent with our strategy, being proudly consumer first and distribution agnostic across the distribution ecosystem. Our traditional pay TV market will remain our dominant customer base for some time to come,” Murdoch told analysts during the media giant’s second quarter earnings call for 2024.
“As such, we remain committed to our existing distribution partners where our strong portfolio of leadership sports, news and entertainment brands thrive in their bundled offerings. This unique new platform opens up a new market for us, one that we have not accessed before and that we’re excited to participate in.”
Murdoch said the joint venture would target around 60 million households that currently don’t participate in the bundled cable and pay television ecosystem, stressing that instead of focusing on creating “cord cutters” they’re going after “the cord nevers.” He added that the anticipated risk to Fox News would be “very low” given the new platform’s focus on sports.
“We’ve done lots of sensitivity analysis and we would not be launching this product if we thought it was going to significantly affect our pay TV affiliate partners and that’s very important to us,” he added.
The service will be launched in the fall, with each media giant owning one-third of the company, having equal board representation and licensing their sports content to the joint venture on a non-exclusive basis. The venture will have its own independent management team.
The offering will provide subscribers with access to content from linear sports networks including ESPN, ESPN+, ESPN2, ESPNU, SECN, ACCN, ESPNEWS, FOX, FS1, FS2, BTN, TNT, TBS, truTV, as well as the ABC network. Content will include the NFL, NBA, WNBA, MLB, NHL, NASCAR, College Sports, UFC, PGA TOUR Golf, Grand Slam Tennis, the FIFA World Cup, cycling and much more. Subscribers would also have the option to bundle the product, with Disney+, Hulu and Max.
Pricing details and a name for the service will be disclosed at a later date, though an individual familiar with the matter told TheWrap that the price point would be cheaper than YouTube TV, which charges $72.99 per month for its basic plan. CNBC reported a logical starting point could be $45-$50 per month.
Despite the one-third ownership stake for each company, the individual emphasized that the networks will not share revenue from the venture equally, with the companies expected to earn a similar carriage fee rate as they do through other distribution channels where their networks available.
Fox Corporation chief financial officer Steve Tomsic declined to provide a forecast around any cash contribution or deficit from the joint venture, but said they expect it to be “accretive pretty quickly.”
The joint venture notably does not include Paramount Global and Comcast’s NBCUniversal. Murdoch said that the joint venture is not considering adding new partners at its current stage.