Fox to buy Tubi for US$440 million

Fox Corp which is born out of the US$71 billion Disney acquisition of 20th Century Fox has announced that it is going to acquire AVOD Tubi in an attempt to enter the streaming market.

Fox will pay around US$440 million to the company and the deal “underscores Fox’s long-term strategic initiatives to broaden and enhance [its] direct-to-consumer digital reach and engagement.”

Tubi is currently available in the US, Canada, and Australia, with coming launches scheduled for the UK and Mexico. It is available on more than 25 digital platforms and features 20,000 titles and 56,000 hours of film and episodic television programming from over 250 content partners.

Tubi will be an independent service while simultaneously integrating with its capabilities in areas like digital advertising, DTC interfaces and personalisation tech.

Fox CEO Murdoch said, “Tubi will immediately expand our direct-to-consumer audience and capabilities and will provide our advertising partners with more opportunities to reach audiences at scale. Importantly, coupled with the combined power of Fox’s existing networks, Tubi provides a substantial base from which we will drive long-term growth in the direct-to-consumer arena.”

In 2019, Tubi witnessed an increase in monthly active users to 25 million and total view time reaching 163 million hours.

The deal will be primarily financed with proceeds from the sale of Fox’s stake in Roku, with the company saying that it is “essentially exchanging a passively held minority investment for full ownership and control of a leadership position in the free ad-supported streaming market”.

Fox becomes the latest major broadcaster to acquire an ad-supported streamer – a buying habit that was effectively triggered by Viacom’s acquisition of Pluto TV in early 2019. Since then, we have seen Comcast acquire Xumo, while the US giant is also reportedly interested in Walmart’s Vudu.