Fox Looking to Generate $1 Billion in AVOD Revenue

Fox Corp. CEO Lachlan Murdoch has big plans for ad-supported VOD platform Tubi. The elder son of media icon Rupert Murdoch spent much time on Fox’s Feb. 9 second-quarter (ended Dec. 31, 2020) fiscal call discussing why Tubi will help transform the AVOD market out of the shadows of the Netflix-dominated SVOD ecosystem.

Fox in 2019 acquired San Francisco-based Tubi for $440 million, about a year after ViacomCBS acquired Los Angeles-based Pluto TV for $330 million. The platforms have energized an AVOD turf war that offers viewers free access to largely catalog content without a requisite subscription or registration.

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Fox Corp. CEO Lachlan Murdoch

Other AVOD platforms include Redbox Free Live TV, Shout! Factory TV, Crackle Plus, NBCUniversal’s Peacock, The Roku Channel, Amazon-owned IMDb TV and Fandango-owned Vudu. WarnerMedia’s HBO Max is launching an AVOD option later this year.

Last year, the number of OTT video services used per household per month rose to more than 7.2 in the United States, according to new data from London-based research firm Omdia. While the increase in online video usage has been driven by an uptick in SVOD services, this has also led to a rise in AVOD use.

In 2020, AVOD platforms in the U.S. collectively generated nearly 200 million active monthly users. Not only did monthly users increase, but so did the frequency of viewing, highlighting a greater conversion rate to daily usage, according to analyst Fateha Begum.

“AVOD users show a high propensity to consume content; they are content hungry, not cost conscious,” Begum said. “As AVOD services grow in popularity and improve their content offering and device accessibility, paid services will have to work harder.”

Indeed, Murdoch sees AVOD showcasing a new marketing channel for brands deploying targeted spots to tens of millions of video-bingeing eyeballs. Across Fox’s digital properties in 2020, usage was up 100%, advertising increased 70%, and active monthly usage increased 70%.

“In the coming years, we envision Tubi becoming a $1 billion business and a core pillar of Fox,” Murdoch said. “The business will ultimately become a very profitable one for us.”

Murdoch said that unlike other media companies, i.e. WarnerMedia, NBCUniversal, Disney and ViacomCBS, spending billions launching SVOD platforms and original content is a non-starter. He said Fox is focusing on AVOD to expand distribution of existing episodic content.

“We see the SVOD competitive set as the potential to lose very many billions of dollars,” Murdoch said. “We see it is very crowded. We see it is very hard to stand apart and differentiate ourselves within SVOD. And that’s why we’ve really chosen to embrace AVOD as our direct-to-consumer strategy.”

New data from eMarketer found Tubi streamed 2.5 billion hours of content, including 30,000 titles, to 33 million monthly active users  in 2020.  About 48% of total Tubi viewers don’t subscribe to pay-TV — including 58% of 18- to 34-year-olds. eMarketer projects streaming video use to outpace pay-TV  by 2023, when access to 64.4 million households will exclusively default to streaming video.

As an ad strategy, the majority of Tubi users are incremental to linear and other AVOD platforms — but apparently loyal to the brand, according to the research firm. About 80% of its viewers can’t be reached across the top 25 cable TV networks. More than 68% don’t sample other AVODs, and 64% can’t be reached across other Fox Entertainment channels.

“We expect to win in AVOD and be the leading AVOD player in this country,” Murdoch said. “We expect to be able to do it by reinvesting our profits, but not by losing billions of dollars in programming costs or other costs in the time it takes to breakeven.”

 

Tubi, Political Ads Up Fox Corp. Q2 TV Revenue

Fox Corp. Feb. 9 reported second-quarter (ended Dec. 31, 2020) television segment revenue of $2.56 billion, up 13% ($290 million) from the previous-year period of $2.27 billion. Fox attributed the uptick to increases in advertising and affiliate revenue.

Advertising revenue increased $168 million, or 10%, to $1.84 billion, primarily due to record political advertising revenue and the impact of the consolidation of Tubi. Fox acquired the ad-supported VOD platform in 2019 for $440 million to compete against ViacomCBS’s Pluto TV and ongoing advertising migration to connected TVs.

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Fox has aggressively marketed Tubi with access to original Fox content, including “The Masked Singer,” “The Masked Dancer” and “Name That Tune,” among other programming. Tubi Feb. 12 will exclusively stream Sundance Film Festival nominee Beast Beast. The AVOD is in the midst of a week-long promotional campaign with third-party vendors such as Postmates, Vizio, AdAge, “The Ellen Degeneres Show” and Roku.

The television segment reported a quarterly pre-tax loss of $185 million, an improvement of $29 million from the $214 million loss reported in the prior year quarter. The increase in expenses was primarily due to higher programming rights amortization at Fox Sports, led by contractual rights increases for NFL content, and the impact of the consolidation of Tubi, partially offset by the postponement of certain scripted programming at Fox Entertainment due to COVID-19.

The cable network programming segment, which includes Fox News, reported pre-tax income of $571 million, an increase of $15 million, or 3%, from the $556 million reported in the prior year quarter, primarily due to the revenue increases. Revenue increased 1% ($19 million) to $1.49 billion as higher advertising revenue were largely offset by lower affiliate and other revenues due to COVID-19.

“Once again, the company delivered exceptional operating and financial results,” CEO Lachlan Murdoch said in a statement. “Fox Television Stations, Fox News Media and Tubi all experienced record highs in the quarter, led by an unprecedented political advertising cycle at our local television stations, strong digital growth at Fox News Media and an influx of new advertisers at Tubi.”

Fox Rolling Out ‘Free Like Tubi’ Weeklong AVOD Promotion

Tubi, the AVOD platform Fox Corp. acquired in 2019 for $440 million, is mounting a week-long promotional campaign — dubbed Free Like Tubi — with third-party services and consumer electronics manufacturers, to attract viewer eyeballs.

Beginning Feb. 8, Tubi will sponsor ad-free listening through the week on streaming music provider Pandora. Listeners will have free “Video Plus Access” throughout the week. Tubi will give mobile app players free rewards on mobile game provider Zynga if users watch and engage with sponsored Tubi video content.

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Additional cross promotions include unlocking the paywall on Ad Age and giving readers complimentary access. Beginning Feb. 9, Tubi and Postmates will launch a “National Pizza Day” partnership to celebrate the special day and Free Like Tubi Week in New York, Los Angeles and Chicago. On Feb. 10, Tubi will host free Amazon Fire TV 4K with Alexa Voice Remote device giveaways.

On Feb. 11, Tubi will partner with “The Ellen Degeneres Show,” where one audience player takes a popcorn quiz and goes on a search for the correct title in a huge bucket of popcorn. Additionally, 100 winners on Ellen’s IG (@theellenshow) stories will receive Visa gift cards courtesy of Tubi.

On Feb. 13, Tubi will give away one Vizio 55-inch V-series SmartCast TV and one Vizio V-series V21-H8 Soundbar. The next day, Tubi and Spotlight Cinema Networks will celebrate Valentine’s Eve with free concessions for the first 20 moviegoing cars at the Arena Cinemalounge in Hollywood, The Frida Cinema in Los Angeles, as well as the Skyline Drive-In and Plaza Cinema & Media Arts Center in New York City.

Tubi will host free Roku Express device giveaways on Feb. 14. On Feb. 15, to wrap up the campaign, Guillermo from “Jimmy Kimmel Live” will treat the audience to free giveaways. Additional swag giveaways include “The Masked Singer” (@MaskedSingerFox), “The Masked Dancer” (@MaskedDancerFox) and “Name That Tune” (@NameThatTune).

Tubi Adds New Fox Music Reality Series ‘I Can See Your Voice’

Tubi is going back to the Fox Corp. content well for new music reality series “I Can See Your Voice,” which is now available to stream on the ad-supported VOD platform. Weekly episodes from the debut season, hosted and executive produced by “The Masked Singer” panelist Ken Jeong, will continue to roll out on Tubi shortly after their linear broadcast premiere.

The series is the latest addition from Fox to be added to Tubi’s library of more than 23,000 movies and TV shows. The next new episode of “I Can See Your Voice” premieres on Fox Oct. 28.

The series features Jeong, along with Emmy-nominated actress Cheryl Hines (“Curb Your Enthusiasm”) and Daytime Emmy Award-winning television host and vocalist Adrienne Bailon-Houghton — in addition to a rotating panel of celebrity detectives and a musical superstar — as they help one contestant tell the difference between good and bad singers, without ever hearing them sing a note.

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With $100,000 on the line, the contestant will attempt to weed out the bad “Secret Voices” from the good, based on a series of clues, interrogation and lip sync challenges. In the end, the singer whom the contestant picks will reveal if they are good or bad in a duet performance with the musical superstar, resulting in a musical collaboration or a totally hilarious train wreck.

Tubi, which Fox acquired earlier this year for $440 million, recently announced record “monthly active users” (MAU) reached 33 million in August, an increase of 65% year-over-year — with total view time surpassing 200 million hours of content streamed each month since April.

Tubi TV Integrates With Fox Media Down Under

Since Fox Corp. acquired Tubi TV earlier this year for $440 million, it has aggressively sought to meld the ad-supported VOD platform with its programing and management.

Tubi July 1 announced it has entered an exclusive ad sales partnership with Australian media company Foxtel Group. As part of this collaboration, Foxtel Media will serve as the sole ad sales representative in Australia for Tubi through 2022.

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Headquartered in San Francisco, Tubi streams movies and TV shows from nearly every major Hollywood studio. The service has more than 200 million monthly views and is available in the U.S., Canada, Australia, and Mexico.

For Foxtel Media, which is owned by Rupert Murdoch’s News Corp., Tubi adds a key free-to-the-viewer ad-supported component to its portfolio of live sports, lifestyle, entertainment content and news. In an advertising world that is increasingly powered by data targeting capabilities, Foxtel Media now straddles the fence marketing between free and subscription-based content distributors.

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“Our collaboration with Foxtel Media delivers an optimally localized relationship and trusted team for advertisers in Australia,” Tubi CEO Farhad Massoudi said in a statement.

Mark Frain, CEO of Foxtel Media, says the technology behind Tubi has enabled the AVOD to rapidly build viewership across Australia and Mexico.

“We have the opportunity to connect brands and advertisers to Tubi’s outstanding proposition in this market,” Frain said.

Tubi is available in Australia on Telstra, Android and iOS mobile devices, Amazon Echo Show, Google Nest Hub Max, and on streaming media devices such as Amazon Fire TV, Vizio TVs, Sony TVs, Samsung TVs, Roku, Apple TV, Chromecast, Android TV, Xbox One, and PlayStation 4, and soon on Chinese Hisense TVs globally.

Tubi Begins Streaming ‘The Masked Singer’ Episodes

Ad-supported VOD service Tubi April 23 announced it has begun streaming the first two seasons of Fox singing competition show “The Masked Singer” — the No. 1 show on television in its third season. It is the highest-profile program on Tubi.

Fox Corp. acquired San Francisco-based Tubi earlier this year for $440 million in cash.

The first two seasons can be viewed tonight at 8 p.m. ET / 5 p.m. PT. Current season-three episodes of the show will be available on Tubi in the weeks following their airing on Fox.

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“The Masked Singer” features celebrities facing off against one another with one major twist: Each singer is shrouded from head-to-toe in an elaborate costume, complete with a full-face mask to conceal his or her identity.

With each performance, host Nick Cannon, panelists Jenny McCarthy, Nicole Scherzinger, Ken Jeong, and Robin Thicke, audience members, viewers, and even other contestants are left guessing who is singing behind the mask. Ranging from Grammy Award winners to legendary athletes, and everything in between, the singers may attempt to throw the crowd off their scent, while keen observers might pick up on tiny clues buried throughout the show. One singer is eliminated each week, ultimately revealing his or her true identity.

“This marks the first of many new initiatives we’ll pursue with Fox,”Adam Lewinson, chief content officer of Tubi, said in a statement.

“The Masked Singer” is averaging a 3.3 Live + 7 Day rating and 15 million viewers across all platforms. Fox claims the show has helped it win Wednesday night ratings every week it’s been on the air. The season-three premiere after Super Bowl LIV drew nearly 30 million viewers and a 9.4 L7 rating, marking television’s #1 entertainment telecast in two years and the highest-rated and most-watched reality telecast in eight years.

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Tubi Partners With Viewership Tech Company

With tens of millions of its viewers consuming ad-supported video-on-demand content, Tubi wants a better picture who its users are.

Tubi, which is owned by Fox Corp., is partnering with TransUnion to enhance the way consumers engage and interact with content platforms.

The partnership enables Tubi to deliver curated content and viewer experiences by establishing a more “enriched view” of individuals and households. Tubi hopes the pact will advertisers “seamlessly bridge” the gap between individual and household, and deliver a more personalized ad experience alongside the content.

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“The integration of TransUnion data assets can help companies connect the dots to gain a more comprehensive understanding of today’s consumer and reach them with confidence – especially as they move and consume content in new ways,” Matt Spiegel, EVP of marketing solutions and media vertical at TransUnion, said in a statement.

Spiegel said the decline of third-party cookies combined with changing media consumption habits, alternative identifiers such as home IP address are imperative for building a strong foundation of individual-level identity and reaching consumers on devices like connected TVs.

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Mark Rotblat, chief revenue officer at Tubi, said the partnership will help the platform create more informed audience targeting and media strategies to identify the best types of content and connect that to relevant messaging for viewers.

By creating a linkage from a device ID, Tubi said it can draw  insights around consumer preference and deliver better content personalization and recommendations for users.

“Incorporating this information often results in better performing campaigns and more engaged viewers,” Rotblat said. “Tubi’s strength is in the data surrounding content viewing behavior.”

‘Tubi Kids’ Begins Rolling Out on Android Devices

Tubi, the ad-supported video on demand service owned by Fox Corp., April 14 began rolling out “Tubi Kids” on Android. Tubi Kids will be available to all Android users in the coming days, expanding its current availability on Roku, Fire TV and Comcast Xfinity.

“Collaborating with one of the most widely used operating brands is key in our mission to democratize content and provide value to our customers,” Michael Ahiakpor, chief product officer at Tubi, said in a statement.

Tubi Kids features a library of children’s content — over 1,200 age-appropriate movies and television shows just for families. A destination for age-appropriate content on the service, Tubi Kids is intended to helps alleviate parents’ worries over what their children are watching and will soon be available on all major streaming devices in the near future.

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Tubi Kids movies include Steven Spielberg’s The Adventures of TinTin, Norm of the North and Teenage Mutant Ninja Turtles, alongside series “Sonic the Hedgehog,” “Strawberry Shortcake,” “Paddington Bear,” and “The Wiggles,” among others.

With total view time topping 163 million hours watched since December, Tubi claims to be the world’s largest AVOD service with more than 20,000 movies and television shows from nearly every major Hollywood studio.

Tubi is available on Android and iOS mobile devices, Amazon Echo Show, Google Nest Hub Max, Comcast Xfinity X1, Cox Contour, and on OTT devices such as Amazon Fire TV, Vizio TVs, Sony TVs, Samsung TVs, Roku, Apple TV, Chromecast, Android TV, Xbox One, and PlayStation 4, and soon on Hisense TVs globally.

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Disney Dropping ‘Fox’ From Content Branding

The Walt Disney Company will drop the “Fox” name from some of the assets it acquired in its $71.3 billion buyout of 21st Century Fox studio from the Murdoch family last March, according to reports.

As such, the 20th Century Fox film studio will now be known as 20th Century Studios, while the studio’s indie arm, Fox Searchlight Pictures, is now just Searchlight Pictures. Logos for the newly named subsidiaries have been similarly updated without the “Fox” name.

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The name change has apparently not yet extended to Disney-owned production units 20th Century Fox Television and Fox 21 Television Studios, though a potential name change could be coming on that front as well, according to Variety.

Also unknown is how the rebranding will affect the name of 20th Century Fox Home Entertainment. Inquiries to the studio have not yet been answered.

The primary reason for the re-branding is to distinguish the new Disney-owned properties from assets such as the Fox broadcast network and Fox News Channel that were not included with the sale and are still controlled by the Murdoch family under the Fox Corp. banner.

Disney has already started phasing out “Fox” from company email addresses and is using the Fox-less branding for upcoming projects such as the films Downhill and Call of the Wild.

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Interestingly, the history of the 20th Century Fox studio began with the merger of two independent studios in 1935: Twentieth Century Pictures, founded in 1933, and Fox Film Corporation, founded in 1915. Rupert Murdoch bought 20th Century-Fox in the 1980s and dropped the hyphen from the name. Fox Searchlight was created in 1994.

Iconic 20th Century Fox studio elements such as the spotlight logo and the musical fanfare date back to the Twentieth Century Pictures days, and will be retained by Disney.