After building up its subscription streaming services, Binge and Kayo – both of which have more than 1.5 million paying customers – and spending nearly $80 million launching a streaming aggregation service Hubbl, News Corp wants out of its 65 per cent ownership stake. Telstra owns the remaining 35 per cent.

A sale would have far-reaching impact on Australia’s media sector, with Foxtel one of Australia’s key players in sports and entertainment broadcasting, and also having a historical influence on regulation in the sector.

A Telstra spokesperson echoed News Corp’s commentary over the sale.

“Consistent with the statements made by News Corp, there is no assurance regarding the timing of any action or transaction, nor that the strategic review will result in a transaction or other strategic change.”

Foxtel remains structurally challenged. The looming NRL rights negotiations, which will be up for grabs soon, could make or break Kayo, depending on whether it can retain it and how much it pays.

“Our goal with Binge is to maintain [it] going forward, and I think having Binge there, to be able to bundle with Kayo, inside or outside of Hubbl, and with other streamers is a real asset,” Delany said.

Revenues across News Corporation rose by 6 per cent in the final quarter of fiscal 2024 to $US2.58 billion. EBITDA (earnings before interest, taxation, depreciation and amortisation) was up 11 per cent on the corresponding quarter, totalling $US380 million, with its Harper Collins and REA Group businesses more than offsetting sharp declines in the news media segment.

In Australia, paying subscribers to News Corp’s news mastheads including The Australian, The Daily Telegraph and The Herald Sun grew to 968,000, up 2000 on the previous quarter. Revenue decreased by 5 per cent in Australia, the company said, “driven by lower circulation and subscription revenues”.

Kayo added 108,000 paying subscribers in the fourth quarter, on the back of the AFL and NRL offerings the service carries, while Binge netted 76,000 new paying subscribers for the period.

However, Delany said there was still plenty of work to be done on Hubbl. While device sales remain “on track”, he said the public was not yet sold on the overall purpose of the device.

“We’ve got pretty good recognition of the word Hubbl, but Australians are not quite understanding what it does.”

Hubbl, Kayo and Binge have allowed Foxtel to counter the terminal decline of its legacy set-top product, with paying Foxtel box customers almost halving to 1.2 million in the past four years. The set top business does remain profitable, for now.

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