In a landmark deal that signals a shift in the media landscape, News Corp has agreed to sell its Australian cable TV unit, Foxtel, to British-owned sports streaming giant DAZN for a staggering A$3.4 billion ($2.1 billion), including debt.
This move not only reduces the Murdoch-controlled media empire’s exposure to the increasingly competitive streaming market but also positions DAZN (pronounced Da Zone) as a major player in Australia with rights to stream high-profile sports like the Australian Football League (AFL) and the National Rugby League (NRL).
A Strategic Exit for News Corp
The deal gives News Corp a 6% stake in DAZN, along with a seat on its board, allowing it to remain involved while focusing on its core businesses like Dow Jones, digital real estate, and book publishing. CEO Robert Thomson highlighted the significance of the sale, stating:
“This transaction allows us to hone our focus on our primary operations, including Dow Jones, REA Group, and HarperCollins.”
The valuation of Foxtel at seven times its 2024 EBITDA exceeded expectations, according to Morningstar analyst Brian Han. He remarked:
“Critically, it is the first tangible outcome of management’s corporate structure review, a protracted process causing some angst among investors.”
DAZN’s Australian Entry: Changing the Game
For DAZN, this acquisition is a gateway to the lucrative Australian market. Known for its global reach in North America, Europe, and Asia, DAZN has been a disruptor in the sports streaming space, broadcasting major leagues like Italy’s Serie A, Spain’s LaLiga, and Germany’s Bundesliga.
Independent telecom analyst Paul Budde underscored the significance of DAZN’s entry, saying:
“DAZN’s entry into the Australian market, potentially offering competitive or lower rates, could dramatically shift consumer expectations and reshape the pricing landscape.”
This bold move could challenge Foxtel’s traditional premium pricing model, which has struggled to keep up with cost-effective streaming alternatives like Netflix.
Foxtel’s Journey: From Cable Leader to Streaming Contender
Since its launch in 1995, Foxtel has been a dominant force in Australian cable TV. However, the rise of streaming services forced it to pivot, launching platforms like Kayo, which streams popular sports including AFL and NRL, alongside international content through partners like ESPN.
Yet, rising sports broadcasting costs and competition have taken their toll. To stay afloat, Foxtel began sharing rights with free-to-air broadcasters. For instance, its A$4.5 billion deal with Channel Seven for AFL rights runs until 2031.
Despite these efforts, the deal with DAZN marks a turning point in its legacy.
What’s Next?
The sale includes several key elements:
- Foxtel CEO Patrick Delany will stay on to oversee the transition.
- Shareholder loans worth A$578 million will be repaid in full.
- Foxtel’s current debt will be refinanced upon deal closure.
Even Telstra, which owned 35% of Foxtel, has sold its stake to DAZN for A$128 million in cash and a 3% stake in the streaming giant.
A New Chapter for Australian Media
For News Corp and Telstra, this deal is more than a sale; it’s a strategic shift in a digital-first era. Investors responded positively, with News Corp’s ASX-listed shares jumping 3.5% to A$50.79, outperforming the broader market. Telstra’s shares also saw a 1.1% rise.
As the deal is expected to close in the second half of 2025, all eyes will be on how DAZN reshapes the Australian sports streaming market and whether this marks the beginning of a broader realignment in global media.
The future of sports, streaming, and consumer choices in Australia just got a lot more exciting.
