The Always Be Watching newsletter is currently published out of Brisbane, Australia (home of Bluey and the Heeler family). Each day I see a mix of two different types of stories:
There’s all the big industry news coming out of the US, an industry being reshaped as it contracts and shifts from cable and broadcast dominance to a streaming-led future. The legacy companies (think NBC Universal, Paramount Global, and Warner Bros Discovery) are feeling the squeeze thanks to the tech giants (Google, Netflix, and Amazon).
But here in Australia, the broadcasters and the handful of pay television players are all putting forward positive stories about the strength of the local market, while the reality is that audiences are being siphoned by the international tech giants and the legacy studios as they all deliver their streaming products Down Under.
What is the impact of this international media interest in the Australian market? If you are a local company, whether you are a commercial broadcaster like Channel Seven, Nine, a public broadcaster with commercial interests like SBS, or streamers/pay companies like Foxtel/Binge, Fetch TV, or the Nine-owned Stan, you are feeling the intense squeeze of big pocketed, robustly infrastructured international giants like Amazon, Apple, Netflix, Paramount, etc.
Challenges in content acquisition - availability of titles, additional competition to acquire library titles.
Further fragmentation of the audience (impacting audience numbers for advertisers, subscriber numbers, etc)
Employment uncertainty (have a chat to anyone at Channel 10 right now and ask them how they feel about their employment security as parent company Paramount Global is in play).
Talent drain - every week or two I hear of former colleagues and industry pals who are making use of those transferable skills they have developed and are finding alternative employment.
All of this is pretty obvious and a reality for those working in the local industry. And this isn’t just Australia. The same pressures are being felt by every other local TV provider in every territory globally.
US content has served as the backbone for so many TV providers and now that that access is drying up, the intensity of that drought is being felt.
Today in the Australian Financial Review, media reporter Sam Buckingham-Jones considers the squeeze on the half-Murdoch-owned Foxtel and its streamer Binge. The big threat to the company is the expiration by years-end of its deal with Warner Bros-Discovery to control the high-value HBO content. It is a concern with wider impact as WBD is expected to then launch Max into the market, creating even greater fragmentation with a well-resourced player in the market.
WBD launching a local service not only strips Foxtel and other companies licensing content from WBD, but it adds yet another player in, which will see churn from other established local players. Max in Australia is just as much a concern for Foxtel/Binge as it is, lets say, Stan. We saw this same scenario play out when Paramount Global consolidated its licensed assets in Australia for a local Paramount+ launch.
The company’s earnings are set to shrink by a further $150 million over the next three years to $390 million in the 2026 financial year, analysts forecast. A company once feted for a $2 billion valuation and a public listing now faces an uncertain future.
Some time next year, likely before the end of March, it is expected that Warner Bros Discovery will launch its own streaming platform, Max, in Australia – stripping Foxtel and Binge of immensely valuable HBO content such as Succession, Game of Thrones and Euphoria. Likewise, wrestling entertainment empire WWE, also on Binge, signed a $US5 billion ($7.8 billion) global deal with Netflix that the US streamer says will soon include Australia. Binge’s managing director, Amanda Laing, has resigned.
The future for Foxtel is sports, primarily through dedicated sports streamer Kayo. But the costs of that are extraordinary.
From 2025, Foxtel will pay, on average, an extra $111 million a year more for the AFL rights than it has paid for the past five years – from an average of $307 million to $418 million. This is not money that is lying around.
Foxtel’s key commercial sports executive, Rebecca McCloy, told The Australian last month that it had signed 175 deals with 120 different sports partners and agents over the past 12 months.
Macquarie analysts estimate Kayo generated $454 million in revenue for the group last year, compared with $1.7 billion from traditional Foxtel customers. The price of the Kayo Basic product jumped 17 per cent to $35 in February, although those kinds of increases are hard to pull off repeatedly.
None of this is news to anyone who is paying attention. But it serves as a reminder of the existential threat facing the screen entertainment industry as the big guys further dominate the local market.
Oh, wait… one more thing as you consider the financial realities for Australian companies (most funded through advertising):
Netflix with Ads launched November 2022
The Amazon-owned Prime Video launches its mandatory ad tier by mid-year
Paramount+ launches its ad tier in June
The Google-owned YouTube just reported a (global) Q1 increase in revenue with ads topping $8 billion, up from $6.7 billion. Read: Deadline
(And this doesn’t even include the additional pressure from advertising supported international social platforms like Instagram/Facebook and TikTok.)
Yeah, this shit is grim.
She seemed like such a nice girl
Here’s Gillian Jacobs appearing on CBS comedy show After Midnight. She is introduced and explains how to pronounce her name:
“Yes, I’m Gillian Jacobs,” she said. “That’s hard G, soft J, but the vibe is just right.”
As anyone who regularly watches subtitles on, you’ll know that often there are mistranslations and a lot of artistic license taken between what was said and what is seen on-screen.
But this discrepancy might be a bit much…
Oh dear.
You can read more over at the Late Nighter site.
CBS has announced a season 5 pick-up for The Equalizer, while NCIS: Hawaii is the last prime time show to discover whether it’ll be back for another season. Read: TV Insider
Another “on-the-bubble” show is Law & Order: Organized Crime. NBC officially passed on a new season, which, as expected, opened the door to the show moving to streamer Peacock for a 10-episode season. Read: THR
Not a surprise at all, but hit Prime Video show Fallout will be back for a second season. The show is relocating to California to receive $25m in tax credits. Read: Variety
Netflix has given a 16 episode (!!!) order for a new Chuck Lorre-produced sitcom built around comedian Leanne Morgan. Read: THR
In the best possible news, the awful G/O Media has sold The Onion to Global Tetrahedron, a digital company said to be “made up of four digital media veterans with a profound love for The Onion and comedy-based content.” Read: Variety
Why was Harvey Weinstein’s conviction overturned? THR has this explainer.
The Writers Guild of Canada have voted to approve strike action. Read: Deadline
Mattel will launch three FAST TV channels on Samsung TV Plus later this year. The channels will be themed around Barbie, Hot Wheels, and Mattel Jr properties. Read: Next TV
The manhunt is over. Home & Away actor Orpheus Pledger has been caught by the police. Read: Variety
A film based on Richard Osman’s novel The Thursday Murder Club has been picked up by Netflix. Read: Screen Daily
Clipped debuts on Hulu 4 June.
FX’s Clipped goes behind the scenes of a notorious NBA owner’s racist remarks, captured on a tape heard around the world. The limited series charts the collision between a dysfunctional basketball organization and even less functional marriage, and the precipitating tape’s impact on an ensemble of characters striving to win against the backdrop of the most cursed team in the league. Starring Laurence Fishburne, Jacki Weaver, Cleopatra Coleman, and Ed O’Neill.
Mayor of Kingstown season 3 debuts on Paramount+ 2 June.
In Good Hands 2 (there was a first?) debuts on Netflix 23 May.
A newly reunited father and son grapple with new beginnings after tragedy, but can they manage to fill the void left by a beloved wife and mother?
Monster debuts 16 May on Netflix.
After being abducted and taken to a desolate house, a girl sets out to rescue her friend and escape from their malicious kidnapper.
Drawing Closer debuts on Netflix later this year.
It is a story of a time-limited romance woven by two people who strive to live in the present moment.
Initially posted on a self-publishing website, this story soon caught the eye of editors, who noted that despite the plot being almost entirely revealed by its original Japanese title, it still made them cry. It later went on to be published as a best-selling book by Ao Morita, with readers sharing their tearful reactions on social media. Now it receives a live-action film adaptation.
That’s the newsletter for today.
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What a great piece about the decline of Foxtel Sam Buckingham-Jones wrote in the AFR.
VICE went out of business slowly and then extremely fast as they say. There were articles being written about them all the time. And not good ones. And suddenly one day it's all over.
I'm being a bit dramatic but if Foxtel keeps losing 10% of their traditional pay TV subscribers a year and going on cord cutting in the US this has a tendency to accelerate. How can they raise prices on Binge and Kayo when they will lose HBO and live sports rights become harder and more expensive to come by?
In my eyes if they are pegging their future on Hubbl (the puck and TV) Foxtel's future ain't bright at all. I wouldn't buy the Hubbl puck or TV if Foxtel paid me. People say it's not for advanced users who like app stores and superior technology. I say hogwash. Just because you are a Foxtel customer doesn't mean you have to be stuck in the stone ages.
Will Foxtel wind down Foxtel Now/Go in favour of Binge/Kayo/Flash? It seems unlikely now they will release a Foxtel Go type app for Apple TV/tvOS now they have the Hubbl shitshow rolling. I quite like the Foxtel app for Samsung TVs/Tizen OS.
Apple/Google/Amazon/Roku and the TV manufacturers will all keep steamrolling ahead with new hardware and software updates for their devices. Meanwhile Hubbl will be tied to the dinosaur like traditional pay TV companies Comcast/Sky product roadmap. Foxtel don't seem to have much say or control for Hubbl.
I like Foxtel. Well probably because I am using my parents' Foxtel credentials on my Samsung smart TV Foxtel app and don't pay for it. If that stops I reckon I'd get Binge and Kayo. But anyway most people I know don't subscribe to traditional Foxtel. Some have Binge and Kayo. And from what I gather traditional Foxtel subscribers may be dying out (literally). It's very grim indeed Dan! Haha.