Fox CEO: Hulu Readying Pay-TV Service

6 Feb, 2017 By: Erik Gruenwedel

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James Murdoch wouldn’t discuss ongoing retransmission negotiations with NBC Universal

Hulu’s pending sub-$40 online TV service continues to prepare for launch within the next two months, James Murdoch, CEO of co-owner 21st Century Fox, told analysts.

Speaking Feb. 6 on the company's fiscal call, Murdoch declined to comment on the status of NBC Universal programming joining the platform. Instead, he said Hulu management remained “very focused” putting together a channel bundle that, he said, is “really” going to work for customers.

The service, which is co-owned with Disney, Comcast and Time Warner, aims to compete against Sling TV, DirecTV Now, PlayStation Vue, Charter Spectrum TV Plus and a probable offering from Google for broadband-only households, and currently has channel agreements in place with CBS, Disney, Turner and Fox, among others.

“We expect this explosion of [online TV] competition to benefit customers, spur innovation and grow the overall market place in the U.S., where topline [pay-TV] subscriber growth has not been so great,” Murdoch said. “We’re at the beginning of a great transformation in the business.”

The executive reiterated Fox’s familiarity distributing consumer-direct video in Europe through satellite operator Sky’s NowTV and Sky Go. When asked if Hulu would be able to avoid some of the tech problems that have, at times, undermined Sling TV and DirecTV Now, Murdoch admitted issues streaming live sports or mass-appeal events is not trivial.

“We have a high degree of confidence in the Hulu platform, the team there, [and] their ability to deliver a ton of video. We think it’s going to be pretty strong,” he said.

When asked if Fox would consider branding Sky in the U.S. or deliver Fox channels to consumers as standalone properties, Murdoch said there were no plans to market Sky Go or NowTV in the U.S.

“These [brands] can live in different territories, but there are no plans at this point [to do so]. We’re focused on the strength of all these brands and growing all these businesses within their immediate neighborhoods,” he said.

Meanwhile, the CEO said steps remain to simplify the authentication process for TV Everywhere apps for current pay-TV subscribers, including creating single logins across multiple brands, which he said would ‘really’ make it easier to generate "some real audiences there.”

Adobe recently issued a series of  suggesting TV Everywhere could grow to reach 70% of pay-TV subscribers by the end of 2017, if operators improved content discovery, increased consumer awareness and reduced sign-in friction.

Murdoch contends proliferation of “downstream” online pay-TV competition is healthy for content creators and brands like Fox, and can reverse overall subscriber declines in the MVPD universe.

“[Online TV] is crowded in terms of the [brand] names that are out there. But I think it’s very, very nascent. We think there’s a lot to play for. It’s a big opportunity. It’s very early days. And it’s a big market place,” he said.

 

 

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