Foxtel claims to reap benefit of new pricing strategy


Joseph O'Halloran

| 14 August 2015

Strong growth in customer numbers, driven by a new pricing and packaging strategy has reignited subscriber growth and generated record low churn at Telstra and News Corp joint venture Foxtel.

The end of year results show that the pay-TV provider's subscriber numbers grew by 9% or nearly 230,000 driven mainly by take up of traditional cable and satellite products. Significant growth continued all the way through the financial year. Churn declined by 1.6 percentage points to 10.9%, the lowest recorded since at least 2000.

The subscriber growth also resulted in an increase in revenue, although this was partially offset by the impact of a soft advertising market. Total subscriber revenues were up 2.4%, lower than subscriber growth. Broadcasting ARPU was down by 2% to $93, a function, said the company, of the pricing changes.

"Last year we took the bold step of changing our pricing model to attract more customers," said Foxtel CEO, Richard Freudenstein. "These results demonstrate that was the right call ... [low churn] is a reflection on the quality of programming available to Foxtel customers across all genres, combined with the additional value given to existing customers during the period and the range of price points now available. On average customers now remain with Foxtel for nine years, an extraordinary period for a discretionary entertainment product."