All eyes on Nine boss Mike Sneesby’s strategy for Stan
Nine boss Mike Sneesby is expected to face a renewed grilling this week over the media company’s heavy investment in Stan.
Nine boss Mike Sneesby is expected to face a renewed grilling this week over the media company’s heavy investment in Stan, in the wake of the streaming service’s soft audience growth since he became CEO almost a year ago.
Mr Sneesby, who was the inaugural boss of Stan when it launched in 2015, was promoted to chief executive of Nine Entertainment in March last year, due in part to his successful development of the streaming platform.
He will announce Nine’s first-half results on Thursday, acutely aware that investors will be closely monitoring the company’s strategy on Stan which has lost some of its market gloss since Mr Sneesby, 47, moved to the top job at the media giant.
He will be keen not to repeat the mistake he made last August at his first set of end-of-financial-year results for Nine, when he bullishly announced additional investment in Stan – prompting the company’s share price to plummet almost 10 per cent in the minutes after his address.
The issue that seemed to spook investors last August was Mr Sneesby’s statement that Stan would continue to pour more resources into live sports streaming, which some analysts believe is tricky terrain because of the shortage of available broadcast rights for premium sports.
In August, Mr Sneesby said: “Live streaming and sport was always part of the long-term strategy to Stan in being able to diversify content lineup, and differentiate that proposition in what we knew would be a very competitive market.
“We are effectively launching a start-up business this year and investing back into a start-up business that sits on the side of Stan’s entertainment business.
“With any start-up business comes investment.”
Since then, Stan has invested in Six Nations Rugby, in a $1.5m deal over three years; second-tier motorsport competitions, the ARG SpeedSeries, the little-known Formula E, IndyCar and the World Rally Championship, as well as the mixed martial arts Professional Fights League.
Nine is also likely to face a bitter bidding war this year with Seven for broadcast rights to the Australian Open tennis tournament from 2025 onwards.
Mr Sneesby is likely to be even more circumspect about Stan at this week’s results, given the release last week of data by media research company Roy Morgan which showed viewership of the Nine-owned streaming service actually fell by 4 per cent in the final three months of 2021 (year-on-year), while its key rivals – Foxtel (majority-owned by News Corp, publisher of The Australian), Disney+ and Amazon Prime Video enjoyed strong growth in that quarter of 23.9 per cent, 45.5 per cent and 45.1 per cent respectively.
Viewership of streaming market leader Netflix slipped by 0.1 per cent in the quarter, compared to the same period in 2020.
Roy Morgan CEO Michele Levine said streaming platforms had benefited from the pandemic in Australia, with surging subscription numbers coinciding with extended periods of lockdown.
“Foxtel now has over 7.1 million viewers, up over 1.3 million (+23.9%) from a year ago and up by almost 1.9 million (+35.6%) from two years ago,” she said.
“The growth for Foxtel has been across all its platforms but has been strongest for the new Binge streaming subscription service, launched in May 2020, and Kayo Sports, launched in November 2018. Both new services have well over 1.5 million viewers already. The big increases in viewers for newer services hasn’t been matched by the more established players. Although both Netflix and Stan added a significant number of new viewers in 2020 this momentum was not sustained in 2021.
“The results of the last two years, and particularly over the last year, show that as competition intensifies in the subscription TV market, the pressure grows to bring new content to market to provide new reasons for people to sign up, or continue subscribing.”
A spokesman for Mr Sneesby said the Nine CEO was unavailable for comment on Sunday.
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