Foxtel Tunes In For Profit, Coy On Footy
The Age
Friday August 11, 2006
FOXTEL has unveiled its first full-year pre-tax profit - $4 million - after stabilising costs and adding viewers.
The pay TV provider - owned by Telstra, Publishing and Broadcasting Ltd and News Corporation - is expecting subscriber growth to continue, with digital subscribers topping 1 million in the year to June 30. Total direct subscribers grew by 10 per cent in the financial year, to 1.13 million, producing 17 per cent revenue growth and earnings of $169 million. Chief executive Kim Williams said a new subscriber management system would be introduced next year and further product innovation, including mobile and broadband services, more digital recording (Foxtel iQ) products and video on demand would underpin growth."The kind of growth we have been experiencing has been sustained, our churn levels are at record lows and we are continuing to sustain the average revenue per subscriber that we reached last year," he said. "We feel confident that we will move from a modest profit to a reasonable profit in the current year." Foxtel will be hoping that a range of new products might go some way to soothing football fans, amid fears that the country's only dedicated Australian rules channel, Fox Footy, may close, moving football on to general sports channels. Mr Williams would not give any detail on the progress of talks with new AFL rights owners channels Seven and Ten, simply saying they were going "slowly". Nor would he guarantee that Fox Footy would continue next year. "It is not in our hands," he said. Under the current contract, which ends this year, Foxtel pays News Ltd $34 million a year for three live matches a week plus replays. Seven and Ten are also rumoured to have offered three live matches, but for $50 million. He also predicted digital subscriptions would continue to grow strongly, dismissing suggestions they would begin to plateau soon. Subscription revenue has grown at 24 per cent a year since the digital service started.
© 2006 The Age
