StarHub axes 8 FOX channels: Is it a big deal, really?

StarHub has confirmed to Marketing that eight of its channels under the Fox Networks Group label will no longer be part of its pay-TV package from end of the month.

The channels, according to an article on ST, are music channels Nat Geo Music, Channel V, Channel V Mainland China, and Channel V Taiwan; non-fiction channel National Geographic Channel HD; and Mandarin entertainment channel Xing Kong. BabyTV and Hindi channel Life Ok will also no longer air from June 30th. The fate of 25 other Fox channels such as StarWold and Fox have not yet been decided.

While one might think in the first go that this would benefit competitor Singtel and boost its subscription base, it might not necessarily be the case. The market dynamics have been challenging exisiting pay-TV players for some time now.

With more and more content now being available online and the likes of Netflix making a big move into the market, consumers don't lack avenues to access content from. Last month, Marketing explored the topic of whether local telcos can now afford to raise the price on UEFA matches after Singtel faced criticism on its high pricing, and found that several consumers would turn to online streaming sites to access content rather than pay the hefty price.

As such, more than ever, consumers truly have the power to view content where they want it, when they want it and how they want it.

In a conversation with Marketing,  Ivan Wong, managing partner of Mindshare Singapore said unlike the past, this is not really a zero-sum equation where StarHub's loss would automatically equate to Singtel's gain - especially in an era of choice and disruption.

He added a lot would depend on the popularity and demand of Fox’s content and if it is compelling enough for them to subscribe to Singtel TV to access Fox channels if they aren’t already a subscriber. Wong also added that if or not Singtel will benefit from this depends on FOX’s content distribution and partner strategy moving forward.

The blow wouldn’t leave Fox crippled either because much of FOX content can be accessed through non-cable platforms such as online/video streaming sites.

As such, consumers still can watch their favorite content without contracting with a traditional cable operator. What is worth noting now is whether Fox will look for multiple partners/platforms to air their different channels or simply replace StarHub with another key partner platform, or totally rethink how they will monetise/distribute their content moving forward, according to Wong.

The advent of technology, multitude of content platforms and choices a consumer has, has led to the democratisation of content. The winner is more likely the viewer than any corporate entity, at least in the traditional sense.

Ranganathan Somanathan, chief operating Officer SEA of Starcom MediaVest Group Singapore also agreed that it is not a matter of choosing between StarHub or Singtel.

Rather with OTT services becoming prevalent and offerings such as Netflix rolling out, consumers have more options to work with, when they choose their content. Also, content owners are renegotiating the licensing deals with channels and platforms to maximise their distribution footprint.

"I see this development benefiting the consumers in the long run even as it might seem a pain-point in the short term," said Somanathan adding:

For StarHub and SingTel to succeed in this environment, it will be important for them to structure their offering in such a way that the consumers have the flexibility of choosing content the they crave for rather than be stuck with preset packages.

"If they play it right and focus on their customers, both of them can benefit in the long run," he added.

Moreover, FOX has its own streaming platform on its website, called FOX NOW. The move could benefit FOX in steering audiences to its own site and build a base of viewers. Such a move is not unheard of as increasingly, brands and content creators are moving in the space of becoming broadcasters themselves.

At the time of writing, StarHub was unable to comment on the viewership or ad revenue the channels draw but confirmed the discussions with Fox Networks Group (FNG) are ongoing. However, Lee Soo Hui, head of media business unit at StarHub, said the pay-TV operator is dedicated to offering customers the best variety of content and channel cessations are always the last resort.

“Regrettably, when they do happen, it is usually due to pressing reasons which make carriage of the channels unsustainable such as low viewership or prohibitive costs,” she said.

“We value our customers’ feedback  and we are constantly engaging various content partners to add even more compelling content to our TV offerings. Over the years, we have added many new channels for our customers and we seek their patience as we freshen our content line-up," she said.

The pay-TV operator also recently announced that it will offer a month-long free preview of 40 channels for StarHub TV customers to sample its Entertainment, Lifestyle and Education channels and more.

“FNG is a valued long-standing partner and we hope to come to a win-win-win agreement which creates value for our customers, FNG and ourselves,” she added.

A spokesperson from FNG said: "FNG's 33 channels make up a significant portion of the content available on StarHub TV. Our suite of channels has the highest share of viewership among the other channel groups on StarHub TV."

She added: "The concerns of our fans are important to us, and we are doing our best to keep as many of our channels on air, to avoid disappointing our loyal consumers.  We are currently in renewal negotiations with StarHub, and while we cannot comment on the specifics of that discussion, we remain optimistic that an agreement will be reached."