Merger to put Foxtel, Fox Sports in box seat — Penn
A DEAL to combine Foxtel and Fox Sports will better position the company to vie with technology giants for sports rights and other premium content, Telstra chief Andy Penn says.
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A DEAL to combine Foxtel and Fox Sports will better position the company to vie with technology giants for sports rights and other premium content, Telstra chief Andy Penn says.
News Corp and Telstra are pushing ahead with plans to combine Foxtel and Fox Sports into one sports and entertainment pay-TV player ahead of a multibillion-dollar stockmarket listing.
Telstra is planning to sell down its half-stake in Foxtel to News Corp, giving the telco a 35 per cent share of the enlarged Foxtel. News Corp’s stake in the new company will increase to 65 per cent, compared with a 50 per cent stake in Foxtel now. Fox Sports is wholly owned by News Corp, publisher of the Herald Sun.
Asked about the growing interest of Amazon, Facebook, Twitter, and YouTube in top-tier sports rights, Mr Penn said: “Our media sector is very dynamic at the moment, and with more media becoming available over the internet, essentially that’s changing the dynamics of the industry.”
Competitors such as Telstra rival Optus are now vying for the same rights as satellite and cable broadcasters.
Amazon this month snatched ATP World Tour Tennis rights from European satellite and cable broadcaster Sky, and speculation is rife the likes of Amazon, Facebook, Netflix and Google’s YouTube want to muscle in on the AFL and NRL.
While the Foxtel/Fox Sports deal has yet to be finalised, the two sides have begun talks and sought regulatory approval.
Telstra’s move on the media front is part of a major transformation as it prepares itself for tighter market conditions.
The telco on Thursday announced it would cut its dividends in the coming year, sending its share price down more than 10 per cent — the biggest since-session fall in almost a decade.
Telstra shares recovered some ground yesterday, closing 0.8 per cent higher at $3.90.
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