Foxtel booming thanks to Kayo and Binge – but a far cry from what it used to be

Ten years is a long time in technology, Remember the iPhone 5S? That was introduced 10 years ago. Also ten years ago, Foxtel was crowing about a 1.7% increase in subscribers to a staggering 2.27 million, but today the company is reporting almost 2.5 million more but the balance has shifted to streaming over cable and satellite in a big-big way.

4,723,000 million subscribers to Foxtel, across the Foxtel broadcast business as well as Streaming such as Kayo, Binge and Foxtel Now. That number is up 194,000 on last year with the groth mainly in Binge which has passed 1.5 million subscribers.

On the decline are Foxtel Now, the streaming version of the broadcast platform, down to 177,000 subscribers from 201,000 last year, and of course the at-home Foxtel Cable/Satellite business down to 1.341 million – down 140,000 in just one year, unsurprising given the cost of living crisis we’re in right now.

This all compares to a decade ago, when Foxtel had 2.27 million customers, meaning the company is closing in on having lost one million homes from it’s primary and highest yield subscription service.

With 1.4 million Kayo Subscribers the company would have revenues of over $450 million per year just from sport, the highest cost content but also the most important to the group.

While an extra couple of million “subscribers” in ten years is a story of great success, fending off the rise of Netflix and others in the market, it’s also a stark reality for Foxtel that they have to cling to their sporting rights tightly, and value those customers they have, likely looking to continue pushing Kayo to Binge subscribers and vice versa.

What the News Corp quarterly financial results don’t do is de-duplicate those Binge and Kayo subscribers – there’s probably a decent number who have both, and thus the 4,723,000 subscriber count might include some double ups.

At it’s core, Foxtel has never been more affordable.

If you remove movies from the equation, given how accessible they are on other platforms, a basic Foxtel subscription with Sport in HD is now $56.60 per month (Discounted from $77 list price), but the problem for Foxtel is you can get that sport for around $30 on Kayo, and the TV shows on Binge for $16, so it’s cheaper to access via streaming, and far more convenient with Apps.

Speaking to Foxtel customers, it’s clear to me many are still clinging onto Foxtel for the iQ box (recording shows) and Free-To-Air TV which they access via the box rather than using an Antenna (because either they don’t have one, or they are in a blackspot area). What could harm Foxtel further is a better, and simpler access to free-to-air over the internet. Something every network has via their own apps, but it’s still clunky, and not the most user friendly experience.

What will the next ten years bring?