Following the demise of Venu, the joint venture between Fox, Disney and Warner Bros. Discovery, skinny bundles and direct-to-consumer services alike are arriving to fill the gap.
While reporting a knockout quarter last week (driven mostly by political advertising and live sports), Fox CEO Lachlan Murdoch casually mentioned the company would be launching a DTC service by the end of 2025.
When asked by analysts during the company’s fiscal second-quarter earnings call, Murdoch said the upcoming service will be designed to target cord-cutters and cord-nevers who aren’t, or have never been, in the traditional cable bundle, much like Venu initially planned.
Set to be “holistic of all content,” including sports and Fox News, Murdoch still lamented that, “Our only disappointment in sports is that we will not be moving forward with Venu. In the end, the legal distractions around the business became increasingly difficult to bear.”
Those legal distractions included a successful preliminary injunction from Fubo, with support from other providers such as DirecTV.
While Fox hasn’t revealed many details about the upcoming platform, Murdoch did say subscriber expectations are “modest,” and the company does not intend to cannibalize its linear business.
“We do not expect any exclusive rights costs or additional incremental rights costs with this business,” he said, also adding that any incremental cost would be “certainly relatively low to what our peers have spent in this space.”
That space includes Disney’s upcoming launch of Flagship this fall, a product ESPN Chairman Jimmy Pitaro describes as the No. 1 priority for the company.
The upcoming Fox product is only one of several new entrants into the marketplace. DirecTV made waves a few weeks ago when it revealed its MySports skinny bundle, made available in 187 markets last week, just ahead of Super Bowl LIX. That product combines 40 sports and broadcast channels from Fox, NBC, Disney and Warner Bros. Discovery.
DirecTV will also soon be adding ESPN+ to the MySports package, essentially negating the need for Venu, which also follows a larger trend of streaming services bundled into the cable package.
Remember, DirecTV chose to not litigate directly with Venu, instead letting Fubo take the lead while the cable provider quietly negotiated these new package deals. Conversations are ongoing with CBS to be added to MySports.
Comcast NBCUniversal’s Xfinity also debuted a sports-focused video bundle for its internet customers. Sports & News TV packages more than 50 broadcast, cable news and sports channels, as well as Peacock. It clocks in at $70 per month. DirecTV’s MySports also costs $70 per month, more pricey than Venu’s $43 per month initial launch price.
Fox’s announcement came in a flurry of news for the media company, which reported a record fiscal second quarter with revenue rising 20% year over year to $5.1 billion. Net income also more than doubled to $388 milion.
Much of that growth came from advertising revenue, growing to $2.4 billion, a more than $400 million increase.
