Foxtel is desperately pushing back against a tidal wave of customers seeking to cancel their subscriptions.
Last week the company opened up its content library to Foxtel Now subscribers until 31 May. It also launched 15,000 hours of on-demand sporting content on Kayo Sports, including replays of live games, documentaries and sports entertainment.
Over the weekend, Foxtel began offering heavily discounted packages from $19 a month, down from $25 previously.
All of this has come about because Foxtel’s flagship live sports offering has been decimated by the global coronavirus outbreak. This has cancelled sporting fixtures worldwide, including both the 2020 AFL and NFL seasons, of which Foxtel has exclusive broadcast rights.
Foxtel’s only competitive advantage in the subscription television space is live sports. Therefore, with sporting events globally all but evaporating, there is now little incentive to keep one’s Foxtel subscription, even in times of lock down.
Not surprisingly then, Foxtel’s call centres have been flooded with calls from customers seeking to cancel their subscriptions, with some waiting on hold for hours:
Those who manage to get on to a call centre and are adamant to cancel the subscription are being offered heavy discounts, in addition to the free channel offerings Foxtel announced earlier this week to retain subscribers.
One Foxtel customer, who asked to remain anonymous, refused discounted offers three times. The customer, who was paying about $140 a month, reduced the subscription to $19 a month by removing the sports and movie tiers…
But most Foxtel customers are struggling to contact the provider. West Hoxton mum Tracey Lynch, 43, pays $229 per month for TV, phone and internet through Foxtel and said she has spent ten hours this week on hold.
“Each time, my home phone battery has gone flat,” Ms Lynch said. “We have the highest package with all of the channels, all the bells and whistles. We pay through the bloody nose”…
AFL Media reporter Lee Gaskin publicly expressed his frustration when he couldn’t get on to Foxtel to cancel his subscription, an issue echoed by many across social media platforms such as Facebook and Twitter, as well as Foxtel’s support channels.
Burpengary East resident Lisa Griffith, 45, has been ringing Foxtel “multiple times a week” to get a network problem resolved. “About 24 to 36 hours in total, maybe more,” Ms Griffith said.
The reality is that Foxtel is in a subscription death spiral.
With mass unemployment looming and sporting events cancelled, Foxtel is poorly placed to compete against cheaper streaming rivals like Netflix, Stan, Amazon and Disney. These services provide subscriptions at less than half the cost of Foxtel’s basic packages and arguably provide deeper non-sporting content, including vast catalogues of television shows, movies and original programming.
Even where Foxtel manages to hold onto subscribers, it is doing so after offering deep discounts, in turn crushing its margins.
Remember, Foxtel was already drowning in some $2.3 billion of debt before the coronavirus and had already lost a significant number of subscribers over the previous quarter.
Now the company is fighting for its very survival.
