Lachlan Murdoch Shares Details About Fox’s Joint Streaming Service With Disney and WBD

Murdoch revealed pricing details and subscriber goals for the new streaming service announced in February.

Lachlan Murdoch
Lachlan Murdoch attends the 2020 Vanity Fair Oscar Party hosted by Radhika Jones at Wallis Annenberg Center for the Performing Arts on February 09, 2020 in Beverly Hills, California. Jon Kopaloff/WireImage

During the Morgan Stanley Technology, Media and Telecommunications conference yesterday (Mar. 4), Lachlan Murdoch, the CEO of FOX (FOXA) Corp, shared the first details about Fox’s new sports streaming service announced last month jointly with Warner Bros. Discovery (WBD) and The Walt Disney Company (DIS). The media executive and eldest son of Rupert Murdoch said the streaming service would be priced at the “higher ranges” of external estimates, but promised it would be worth the price tag. 

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The untitled streaming service may cost between $40-$50 a month, according to reports. With the package, users will be able to stream all of Disney, WBD and Fox’s sports channels plus ESPN+. Though the price tag is higher than most streaming services in the market, its inclusion of live TV makes the range competitive with services with live TV components, such as the Disney-owned Hulu+ Live TV. Hulu’s live offering costs $76.99 a month for a package of Hulu+ Live TV, Disney+ and ESPN+ with ads.

“We’ll get paid per subscriber, just as we would as if we were selling to a vMVPD (virtual Multichannel Video Programming Distributor), a YouTube TV, or Fubo TV or a DirecTV,” Murdoch said. “We get paid on the same economics as if they were cable subscribers.”

The three companies are aiming to launch the joint streaming service before the start of the NCAA college football season, and Murdoch said the goal is to attract five million subscribers within five years. For context, YouTube TV is currently the biggest live TV streaming service in the country with more than eight million subscribers, YouTube CEO Neal Mohan revealed in February. It took YouTube TV seven years to build up a subscriber base that size. 

Murdoch noted that, though the streaming service is a product of three media giants coming together, they’re not being anticompetitive. He believes that their target market for the product is “not served at all with sports content.” “This is a pro-consumer package,” Murdoch said. “What this bundle does is put the majority of sports into one bundle, it’s an easy place to come to.”

Paramount (PARA) Global CEO Bob Bakish was asked last week during the company’s earnings call about the Fox-WBD-Disney collaboration, which will compete with the live sports offerings on Paramount+. He didn’t seem to see the new streaming service as a serious threat or a deal Paramount would model after.

“There’s still a lot we don’t know about this service, things like price, packaging, consumer appetite,” Bakish told analysts. “And to the consumer point, for a true sports fan, this product only has a subset of sports,” he added. “It’s missing half the NFL, a lot of college [sports], has virtually no soccer or golf, etc. So look, that’s hard to believe that’s ideal, especially at the price points that have been speculated.”

Lachlan Murdoch Shares Details About Fox’s Joint Streaming Service With Disney and WBD