Life Tech What Foxtel and Netflix’s deal really means

What Foxtel and Netflix’s deal really means

Foxtel Netflix
Rupert Murdoch's empire continues to expand, with Foxtel striking a deal to stream Netflix's content as part of its new "experience". Photo: TND
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The partnership between Rupert Murdoch’s Foxtel and streaming behemoth Netflix heralds a move to a more cohesive viewing experience for Australians, that brings us in line with the rest of the world.

On Wednesday, Foxtel announced “the new Foxtel experience”, which brings together its content on a new interface, but more importantly – fully integrates a Netflix subscription.

Commentators have labelled the move everything from strategic from Netflix’s position, to a play from Foxtel to regain and retain relevancy in an increasingly diverse market.

It follows the latest release of subscriber numbers to Australia’s streaming services earlier this week, from Roy Morgan.

The data noted Netflix remained well ahead of the rest, with 11.5 million Australians among its database. Foxtel has five million, while Aussie’s own Stan has about three million subscribers.

The interface will mirror Netflix’s, while integrating streaming for its subscribers. Photo: Foxtel

What the partnership aims to do is bundle the viewing experiencing for the three million Aussies who have both Foxtel and Netflix, while hopefully attracting some new custom along the way – something Foxtel will likely be banking on, given its latest results show it lost 100,000 subscribers in the previous quarter.

Senior research fellow in media and communications at RMIT University, Dr Ramon Lobato, said the merger would give Foxtel the chance to double-dip with its users.

“If users access Netflix through Foxtel, rather than through a standalone Netflix smart TV app or streaming stick, then Foxtel is still able to ‘push’ its own content and services through recommendations and ads,” Dr Lobato told The New Daily.

A money move

It’s a sign of Foxtel flexing its international clout, Professor Amanda Lotz, of the Queensland University of Technology, said.

Professor Lotz, whose speciality is digital media and communication, said while Foxtel and Netflix weren’t direct competitors, it was an opportunity for the former to use its power to tap into a larger subscriber base.

“What’s interesting about this is we don’t know how much money is changing hands – and which way it’s going,” she told The New Daily, theorising that Foxtel could be compensating Netflix for the free, six-month trial users were receiving – or a bounty-style payment between parties.

netflix foxtel merger
Foxtel’s new remote includes a built-in Netflix button. Photo: supplied

Professor Lotz said it also hadn’t yet been made clear how much the combo-service would cost after the free trial period, but Gizmodo reported on Wednesday that Foxtel was looking to introduce bundle packages in September or October, as part of stage two of the rollout.

Murdoch’s News Corp, which owns 65 per cent of Foxtel (Telstra owns the remainder) was forced to lob $300 million into the service to pay off maturing debts in April.

The start of a beautiful friendship

While Nine-owned Stan has the upper hand in original, native content (save ABC), Victoria University screen media senior lecturer Marc C-Scott said the partnership between Foxtel and Netflix could spawn a new production avenue for Australian media creators.

Netflix will later this year open a headquarters in Sydney, which Dr C-Scott said demonstrated the value it placed on its stake in the Australian market, and could lead to a production stream in the future.

“It would be a good thing for the Australian market. We want to see Australian content surviving and thriving as well,” he told The New Daily.

As for the immediate benefit to Australian viewers, Dr C-Scott said it was all about convenience, and getting the best of the services we’re paying for.

“The ideal situation will be that it’s more integrated, like the Apple TV Plus, where it’s fully integrated,” he said.

“More broadly, I think that’s what Australia is missing: One single aggregate.”

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