Fox Corp., an America-based media firm, has recently announced that it will be acquiring Tubi, one of the largest free streaming service in a transaction worth $440 million in cash. This deal is primarily funded from the sale of the 5% stake of Fox in Roku.
The cable and TV broadcasting firm will be adding a dedicated streaming component with the acquisition of Tubi to get hold of the proliferating internet-video trend as Tubi provides more than 20,000 old TV shows as well as movies for free and also boasts an active monthly user base of about 25 million.
Lachlan Murdoch, CEO and executive chairman of FOX Corp. stated that Tubi will help expand the company’s capabilities and the direct-to-consumer audience immediately and will offer the advertising partners bigger opportunities for reaching the audience at scale.
Murdoch further continued that Tubi provides a significant base, along with the collective power of the existing networks of Fox. This will fuel the long-term goal within the direct-to-consumer arena.
Apparently, the TV conglomerate has pulled off its recent moves to involve itself in streaming wars which is a trend steadily reshaping the media landscape. The acquisition deal by Fox with Tubi underlines the bullishness of the industry towards AVOD, which is ad-supported video-on-demand. It is highlighted as a separate battleground from the Netflix dominated VOD space.
Viacom had acquired Pluto TV, a free-streaming startup for about $340 million in an all-cash transaction while Comcast purchased Xumo in the previous month for more than $100 million, which is an advertising-supported free streaming service. NBCUniversal and Comcast have been planning the launch of Peacock that will also include free AVOD version.
Fox said that it intends to run Tubi as an independent service which will be headed by Farhad Massoudi, the CEO and founder of the company. Tubi has had around 229 employees as of 2019, which is an increase of 78% for the year.