Foxtel intends to boost its investment in original programs, like ‘Wentworth’. 

Foxtel plans to cull more channels from its platform and to pay less for non-exclusive content as it continues to ramp up investment in original content.

The company also flagged plans to embark on co-productions with free-to-air broadcasters and to sell Foxtel Original content to them after the pay-TV window.

“We are reviewing our channel line-up, the content we are prepared to buy and the amount we spend on it,” Foxtel CEO Peter Tonagh told a business lunch in Melbourne.

“We have too many channels that have a small amount of appealing content. By consolidating popular programs onto fewer channels we free up money to be invested elsewhere,” he said, citing the recent decision to close the Foxtel-owned Lifestyle You and to combine Foxtel Arts and music channel Smooth.

In a blunt message to program suppliers, he said: “We have told content partners that we want premium content exclusively and that we continue to be prepared to pay for it.

“However, with less valuable content we will either pass or take it on a non-exclusive basis and pay accordingly.”

Tonagh highlighted Amazon Prime Video’s acquisition of FremantleMedia Australia’s Picnic at Hanging Rock – the biggest ever deal for an Australian series in the US – and the sales of FMA’s Wentworth and  Seven Productions’ A Place to Call Home to more than 140 territories.

“Money from co-productions and international sales will help finance new series that we otherwise would not be able to afford,” he said.

In the past 12 months eight of the top 10 non-sports programs on the platform were Foxtel Originals.

Foxtel’s movie audiences are up nearly 15 per cent this year thanks to pop-up channels screening the James Bond, Harry Potter and Fast and Furious franchises, among others.

Tonagh hailed the successful relaunch and rebranding of the low-cost streaming service Foxtel Now, which is attracting consumers including students, renters and grey nomads who would never consider the full Foxtel service. Last week 20 per cent of the sales of Foxtel’s satellite service were to Foxtel Now subscribers.

The exec reiterated Foxtel’s support for the screen industry’s push to increase the TV producer offset from 20 per cent to 40 per cent and a gradual move away from reliance on quotas.

He also advocated a reduction in some of the rules and rigidities around access to the offset and other funding, indicating he will have more to say on that issue in coming months.

Finally Tonagh talked up the advantages of the proposed merger of Foxtel and Foxtel Sports. Subject to regulatory approval, News Corp would own 65 per cent of the new company and Telstra 35 per cent.

“Both businesses are financially strong, but the whole will be greater than the sum of its parts and being completely commercially aligned will create an even stronger business as we confront the ongoing disruption in our industry,” he said.

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