Nine Boss Set To Face Tough Questioning After Viewers Desert Stan Platform
Nine boss Mike Sneesby is set to face some tough questioning this week about his online streaming operation Stan, which according to the latest Roy Morgan viewing data fell by 4 per cent in the final three months of 2021 (year-on-year), while its key rivals – Foxtel, Disney+ and Amazon Prime Video enjoyed strong growth in the same quarter of 23.9 per cent, 45.5 per cent and 45.1 per cent respectively.
Stan has punted on second tier sports including the Foxtel rejected Rugby Australia rights, the three-year deal cost the Nine network $100 million deal with questions now being raised about the ‘real value’ of the investment to the Nine Network who is facing the potential loss of the rights to the Australian Tennis Open, which despite the Nine network having the rights is not streamed on Stan.
Since then, they have picked up Six Nations Rugby, in a $1.5m deal over three years; second-tier motorsport competitions, the ARG SpeedSeries, the little-known Formula E, IndyCar and the World Rally Championship, as well as the mixed martial arts Professional Fights League.
ChannelNews understands that the Seven Network is looking to go after Tennis and could well drop their Cricket Australia deal for the rights to Tennis.
The Nine network is set to report this week, the second reporting period for Sneesby who the former head of Stan was.
Ahead of this week’s announcements Sneesby has finally announced the appointment via the Australian Financial Review which is owned by Nine Media of Martin Kugeler to run the subscription business permanently.
Sneesby stood down 12 months ago from running Stan to take on the CEO role at Nine Media, Sneesby has faced repeated questions in the past 12 months about the delay in appointing a permanent replacement.
The Australian newspaper owned by News Corp who also own the majority of the shares in Foxtel, claim Sneesby will be keen not to repeat the mistake he made last August at his first set of end-of-financial-year results for Nine, when he bullishly announced additional investment in Stan – prompting the company’s share price to plummet almost 10 per cent in the minutes after his address.
The issue that seemed to spook investors last August was Mr Sneesby’ s statement that Stan would continue to pour more resources into live sports streaming, which some analysts believe is tricky terrain because of the shortage of available broadcast rights for premium sports.
In August, Mr Sneesby said: “Live streaming and sport was always part of the long-term strategy to Stan in being able to diversify content line-up and differentiate that proposition in what we knew would be a very competitive market.
“We are effectively launching a start-up business this year and investing back into a start-up business that sits on the side of Stan’s entertainment business.
“With any start-up business comes investment.”
Roy Morgan CEO Michele Levine said streaming platforms had benefited from the pandemic in Australia, with surging subscription numbers coinciding with extended periods of lockdown.
“Foxtel now has over 7.1 million viewers, up over 1.3 million (+23.9%) from a year ago and up by almost 1.9 million (+35.6%) from two years ago,” she said.
“The growth for Foxtel has been across all its platforms but has been strongest for the new Binge streaming subscription service, launched in May 2020, and Kayo Sports, launched in November 2018. Both new services have well over 1.5 million viewers already. The big increases in viewers for newer services hasn’t been matched by the more established players. Although both Netflix and Stan added a significant number of new viewers in 2020 this momentum was not sustained in 2021.
“The results of the last two years, and particularly over the last year, show that as competition intensifies in the subscription TV market, the pressure grows to bring new content to market to provide new reasons for people to sign up, or continue subscribing.”