Yahoo Finance Fox says price of new streaming sports bundle will be in 'higher ranges' of estimates
A new sports streaming service from Disney's ESPN (DIS), Warner Bros. Discovery (WBD), and Fox (FOXA) will be priced on the higher end of estimates with subscribers expected to hit around 5 million by 2029, according to Fox CEO Lachlan Murdoch.
"The pricing is going to be in the higher ranges of what people have talked about," Murdoch said during the Morgan Stanley Technology, Media and Telecom conference on Monday. "What drives the output from all of that is our internal expectations [that] we will have 5 million subscribers within five years."
The companies announced last month that the joint service would debut sometime this fall and bring together their respective slates of sports rights. The developments come as media companies face pressure from investors to scale their streaming services and achieve profitability.
A big question, however, is how much consumers are willing to pay for a sports-specific standalone service.
According to a CNBC report, the joint service will be priced at or above $40 per month — on par with Wall Street estimates. Morgan Stanley pointed to a potential price point between $40 and $50 a month.
To note, the companies have yet to reveal when they will release exact pricing information.
Murdoch doubled down on the opportunity to target the "cord cutters" and the "cord nevers." He estimated that 50 million to 60 million Americans do not currently subscribe to a cable bundle.
"That's a huge market. It's half of the households in this country," he said. "And we know sports is the No. 1 driver of TV viewing. ... Within that 50 million or 60 million, there is, we believe, a very high percentage [who] will be open to taking this new package."
The executive added that each company will be paid on a per-subscriber basis — the same economics as if they were a cable subscriber.
One risk the service could face is antitrust regulation. Last month, sports streamer FuboTV (FUBO) filed an antitrust lawsuit against the media giants behind the JV, citing "the extreme suppression of competition in the US sports-focused streaming market."
Despite the lawsuit, Murdoch said Fox doesn't have regulatory concerns surrounding the service.
"When you look at the service, it's pro-consumer, it's pro-competition," he said. "It's focused on a cohort of people on a segment [that's] not served at all with sports content."
Alexandra Canal is a Senior Reporter at Yahoo Finance. Follow her on X @allie_canal, LinkedIn, and email her at alexandra.canal@yahoofinance.com.
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