Delany pitches growth as Foxtel finds its footing

Foxtel chief executive Patrick Delany is in an upbeat mood and keen to talk about many things at the moment. But one of the few things he won’t be drawn on is renewed market speculation about a sharemarket float of the iconic pay television business he runs.

“It’s the kiss of death for a Foxtel chief executive to aspire to [an IPO],” Delany tells The Sydney Morning Herald and The Age in a wide-ranging interview. “That’s a shareholder decision. But what’s very clear is that the market misunderstands Foxtel.”

It is difficult to float a business that isn’t growing. So signals from both of those shareholders – News Corp, which owns 65 per cent of Foxtel and Telstra, which owns the remaining 35 per cent – that an IPO could be back on the cards suggest Delany is doing something right.

News Corp chief executive Robert Thomson said earlier this month that Foxtel’s “resurgence” during the coronavirus pandemic had provided the Rupert Murdoch controlled company with “options”, while Telstra’s chief executive Andy Penn said the telco would support an IPO if that’s the path chosen.

Float, sale, merger or otherwise, Delany is determined to point out that Foxtel is no longer floundering. “Whatever the shareholders decide to do, the message needs to get out there that we are back on the front foot and leaning forward again, looking to the future” he says.

Delany took on one of the toughest jobs in Australian media in 2018 when he was appointed chief executive of Foxtel shortly after it was merged with the business he previously ran, Fox Sports.

At the time, Foxtel was struggling. News Corp and Telstra had dropped earlier plans to float the business which was losing subscribers, bloated with costs and riddled with debt. Foxtel was not keeping pace as a stampede of new streaming services led by Netflix that had entered Australia gobbled up subscribers.

“We were really inefficient,” Delany says. “The IQ3 [set-top box] was problematic, if not a failure, and it was the same with [former streaming service] Presto, and that was because everyone was focused on fixing and driving Foxtel.”

These days Delany is not focused on fixing Foxtel. Instead, he’s focused on managing the decline of its legacy product while trying to offset that decline with growth in its low-cost streaming services which are sold under different brand names.

“We started out with David Jones – beautiful building bricks and mortar – and we knocked down half of it.”

Foxtel boss Patrick Delany

Few outside of Foxtel ever really know what is going on inside the company, but one thing is certain – it does not want to be depicted as a traditional pay TV business anymore. With two streaming services launched and a third on the way, plus four other major internal technology projects being worked on, the business is no longer about the set-top box that made…