Before the COVID-19 outbreak ground the world’s economy to a halt, Foxtel was already struggling to remain relevant in the pay television space.
In the year to February 2020, Foxtel lost around 100,000 subscribers at the same time as its online streaming rivals enjoyed significant subscription growth:
The picture has worsened substantially over recent months. The COVID-19 pandemic has postponed sporting events across the globe, which has hit Foxtel particularly hard given it is leveraged so heavily into sport.
Accordingly, Foxtel has experienced a tidal wave of customers seeking to cancel their subscriptions, which has heightened financial pressures.
Foxtel was already drowning under $2.3 billion of debt before COVID-19 struck. Therefore, the loss in subscription revenue was a literal hammer blow that forced the company to slash costs by axing 200 jobs and placing an additional 140 workers on furlough.
At the same time as Foxtel is drowning under COVID-19, its online streaming rivals are growing from strength to strength.
For example, FetchTV CEO Scott Lorson says usage of the subscription television service provider has risen to record levels during the COVID-19 lockdown, while its churn rate is at a record low.
Fetch has also secured a deal to add Amazon Prime Video to its platform, which also offers access to Netflix, Stan and Optus Sport.
Lorson claims that Fetch is well-placed to prosper in the post-COVID-19 environment, given that it has no debt, positive cash flow and is recording growth in its core metrics:
“Fetch has enjoyed tremendous success by making good on the simple proposition of ‘All your entertainment in one easy place’,” Fetch chief executive Scott Lorson said…
“Churn is at an all-time low, usage of the service is at an all-time high, we are seeing heightened demand only tempered by the operational capacity of our ISP partners,” Mr Lorson said.
“Fetch is one of the few media businesses that has no debt, positive cash flow and growth in all core metrics, which puts us in a strong position in the post-COVID-19 landscape.”
Netflix is also booming, adding nearly 16 million global subscribers during the COVID-19 lockdown:
Netflix saw a huge increase in subscriptions as whole nations enforced coronavirus lockdowns in the first three months of the year…
The streaming service added 15.8 million subscribers, bringing its global total to 182.9 million.
Disney Plus subscriptions are also soaring, hitting 50 million earlier this month from 26 million in February.
It appears everyone else is booming while Foxtel busts.
