The man charged with looking after selling advertising on all of Foxtel’s assets, MCN chief executive Mark Frain, has overhauled the Foxtel-owned business as it faces, like many others in media, significant challenges.
Those assets include not only linear channels, but also Foxtel Go, Foxtel Now and the fast-growing streaming service Kayo.
After losing the Network 10 representation, MCN “recreated and redefined it’s business,” Frain told Mediaweek in our Mediaweek Podcast last week.
Staff numbers have shrunk dramatically at what has been labelled MCN 2.0. From close to 500 people when MCN also looked after 10, the business now has under 300.
Frain revealed the company is still a big business and expects to be writing annual sales revenue close to $500m.
Frain started in the MCN creative and integration team 12 years ago when the business was under the control of Anthony Fitzgerald. Frain rose through the ranks and took the top job when Fitzgerald left 12 months ago.
“[Foxtel CEO] Patrick Delaney has charged me with looking for different ad models and different formats,” Frain told Mediaweek.
“Foxtel has over 3m paying subscribers and we need to treat them with respect when it comes to commercial outcomes and advertising impact.
“Across the linear channel base we have looked to reduce ad loads on content such as premium drama. For things like Game Of Thrones we don’t pack it with 13-14 minutes of ad content for very obvious reasons. We are making similar decisions on other premium drama across the platform.
“Similarly with sport we don’t interrupt live play, but we do a lot of innovation and integration in and around the content.
“We are working harder to create a better advertising experience for the Foxtel customer.”
Frain said although program sponsorships do happen, MCN is going beyond that with advertisers being linked to a franchise. He gave an example of the Fox Cricket channel where advertisers are integrated into the fabric of the channel.
“You will be seeing a lot more effort from Foxtel and MCN looking to weave brands into major franchises across the platform.”
Six-second ad initiative
“There have been short breaks and short ads before, but no one has really turned it into a scalable product. With our six-second ads we are looking to provide a better experience back to the viewer,” said Frain.
“And to offer advertisers the chance to get six-second ads across the entire Foxtel platform.”
Frain said advertisers have been keen to be involved with initial testing going well with expansion soon. He noted there will be no six second ads interrupting live sport.
While MCN is still trialling the best way to run the short ads, Frain said they could run two or three back-to-back.
Kayo advertising opportunities
When it comes to the fast-growing sports streaming service, Frain noted:
“There are a handful of sponsorship tiles available to advertisers. We will soon be able to dynamically insert ads into the content.”
Frain said advertising opportunities were part of the plan when Kayo was built and there will be a number of announcements about enhancements soon.
With the multiscreen capability, subscribers can see as many four ads at once across four separate channels feeding into the one screen. “Sounds like utopia,” Frain joked.
The value of Foxtel to an advertiser is not just the home of its biggest audiences, Fox Sports, but the spread of audience across all the different channels and genres. Frain mentioned in particular FOX8, the Lifestyle channels and TVH!ts. “Fox Sports is a big part of it, but there are a lot of channels across the platform making up our overall revenue pie.”
While Foxtel penetration could be higher, Frain spoke about the value of those subscribers and called them “the valuable audience to advertisers”. He also noted penetration in Sydney, Melbourne and Brisbane was important for advertisers as they are the most expensive media markets in Australia.
“I would argue strongly Foxtel should be first on the media plan given the value of our audience.”
As to FTA advertisers telling their clients to avoid Foxtel because of its audience size, Fran replied: “The industry is packed full of competition that makes us all better at what we do. Any media company could walk in to an advertiser or an agency and say, ‘You don’t need the competitor, we can fix everything.’ However because the way audiences are changing you need more media players to deliver critical reach, you just need to get the right mix.”
Foxtel customers are watching more of the platform’s content on demand with Frain noting Chernobyl has taken over from Game Of Thrones as the hottest property in that space. “We will make sure we provide a better advertising experience, not loading the viewing with ads.
“A lot of growth in streaming and on demand has been additional to linear viewing. Foxtel customers are watching more of our content on different devices. We are playing catch-up with the ad model so we can monetise that audience.”
Foxtel on Oxford
MCN has recently opened it own venue in inner-city Sydney.
“Our homefronts used to be like the endless summer,” said Frain when talking about how MCN used to host agencies and advertisers across as many as 30 different upfront events in a different location each year.
“Having the Foxtel an Oxford venue gives us the chance to talk more regularly to our clients and partners rather than on one night only.
“The opportunity to chat to them in a different way in a different space does two things and give us the opportunity to entertain our clients through the power of the content across the year.
“It also allows us to showcase technology for not only MCN staff to engage with clients, but allows us to tell the Foxtel story in a different space that is not a boardroom.”
“It has been designed to represent the Foxtel business which is a premium experience.”
OzTAM data into the future
Frain also hoped that with the election out of the way there would now be a stronger advertising market.
To help advertisers get a better understanding of the total TV audiences now consuming video content, there will be less reliance on overnight ratings in the future.
When asked if overnight audience numbers might start to disappear with total audience data taking over. Frain said: “I think we will see both. The drug of overnight ratings will be hard to get off. There are many advertisers who are looking for information on real time performance and it remains a vital part of the currency.
“With regard to the success of the content that we produce and publish the total audience story defines how great that content is, irrespective of the platform it is being distributed on.”