Erik Gruenwedel

March 9, 2023

As media giants grapple with escalating costs and losses in their streaming video business units, Fox Corp. sits on the sidelines having washed its hands of its Hulu ownership stake in 2019 following the $71 billion 20th Century Fox asset sale to Disney.

For CEO Lachlan Murdoch, the strategy of moving away from subscription streaming to ad-supported VOD is akin to the infamous fight scene in the 1995 dark comedy Monty Python and the Holy Grail, in which two knights attempt to maul each other in numerous ways.

Speaking March 9 at the Morgan Stanley Technology, Media and Telecom Conference in San Francisco, Murdoch says Tubi remains the streaming market’s unassuming player avoiding the direct-to-consumer fiscal bloodshed.

“We’re the little guy,” Murdoch said. “We’re going to be the one to survive because we haven’t had our arms or legs cut off.”

Murdoch said the whole thesis behind the 20th Century Fox asset sale to Disney was based on avoiding a streaming arms war.

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“We could give Disney a winner in the SVOD space [i.e. Hulu] while focusing on our core brands: Live news and live sports, which is where advertisers and audiences are pivoting to,” he said.

Unlike the market focus on free ad-supported streaming TV channels, Murdoch said Tubi isn’t a FAST platform. Instead, he characterizes the service as an ad-supported VOD pure play with the largest video content library of any streaming video service in the world at 50,000 titles.

“All library titles, which keeps the costs down,” he said. “Viewer engagement is focused on specific content, which makes that viewer very important to advertisers.”

Murdoch said he believes the evolution of ad-supported SVOD tiers to the market is good for the whole streaming industry, which he said will up CPMs at Tubi.

Taking a swipe at competing SVOD services such as Paramount+ and Peacock that are incorporating live sports onto their platforms, Murdoch said Fox would continue to keep sports exclusive to linear broadcast television.

“We don’t have a general entertainment underperforming SVOD service, so we don’t need to put sports in,” he said. “The value for us is to keep those sports exclusive to broadcast.”

When asked about the pending high-profile $1.6 billion Dominion Voting Systems defamation lawsuit against Fox News, which alleges Fox allowed opinion hosts such as Sean Hannity, Tucker Carlson, Maria Bartiromo and Laura Ingraham to knowingly peddle conspiracy theories about Dominion voting machines used in the 2020 Presidential Election, Murdoch said the case wasn’t about breaking the law or news gathering.

“A news organization has an obligation to report news wholesomely, and without fear or favor,” he said. “And that’s what Fox News has always done. And that’s what Fox News will always do. And I think a lot of the noise you hear about this case is actually not about the law. It’s not about journalism. It’s really about the politics. And that’s unfortunately more reflective of the polarized society we live in today.”

Murdoch claimed that more Democrats, Hispanics and Asians watch Fox News than watch CNN or MSNBC.

“So, the position of the [Fox News] channel is very strong,” he said.

The Dominion lawsuit is slated to go to trial in April, according to Murdoch.