Kate Bulkley, Media Analyst.

Fox stalks 'adult man'

By Kate Bulkley

Royal Television Society

February, 2004

Sky’s newest channel is a niche offering – but its operator admits to Kate Bulkley that it will prosper only as part of a growing portfolio of channels

The New Year brought a new channel to Sky Digital viewers in the UK – FX. But it wasn’t a surprise to industry watchers with their eyes on Fox’s international ambitions in the channels business.

FX, targeting the UK’s so-called “adult men” is just the latest step forward in what is becoming a very clear worldwide strategy. The group launched five channels last year, including international versions of Fox, National Geographic, Adventure One (a Nat Geo spin-off) and History Channel (which the group manages).

David Haslingden is the driving force behind Fox’s ambition to establish families of channels in various countries and he is using all his experience and his company’s connections to News Corp to achieve this goal.

“I don’t know how many more channels we will launch internationally this year, but what I do know is if there is an opportunity to launch we’ll be able to marshal the resources to do it,” he says.

Haslingden is chief operating officer of Fox International Channels, a unit of Fox Entertainment, wholly owned by News Corp. “I would be disappointed if we didn’t launch at least one more FX channel this year – actually I would be disappointed if we didn’t do significantly more than that,” he adds.

FX – or FX 289 as it is tagged in all its marketing to make viewers aware of its Sky channel number – took its first step outside the US in the UK because Haslingden and his team felt, perhaps surprisingly, there was a “gaping hole” in the market.

“FX UK is a broader proposition than FX in the US, which appeals to 18- to 34-year-old men,” says Hernan Lopez, senior vice-president and managing director at Fox International Channels UK. “In the UK, that space was already taken by E4 and Sky One. So since we were entering the market relatively late, we decided to do a different type of channel.”

FX UK’s target is 25- to 44-year-old men – the so-called “adult man”. In other words, they are not the “lads” only into beer and girls who might typically watch UK channels such as Bravo and Men and Motors.

To attract “adult man” FX UK’s programmes run the gamut from old NYPD Blue and The X Files to the UK premiere of The Mind of the Married Man, an HBO production described as Sex and the City for Men; Autopsy, a reality show also produced by HBO; The Man Show, billed as a “woman-free zone unless they are in bikinis”; and Trash to Cash, a house makeover show based on rummaging items from skips.

FX UK has also inked a sublicense deal for The Shield with Five so that as the terrestrial broadcaster begins to air series three early next year, FX UK will start televising the show beginning with the first season. Navy NCIS, a spin-off of JAG, has been airing on the Hallmark Channel, but FX UK will have rights to the new season of Navy NCIS this year.

Haslingden says that, given how competitive the UK market is, if FX UK reaches a 0.1 audience rating “over time” he would consider that a success. “We understand that it is a niche channel and the UK is a cluttered channel environment. We are not going to look solely at our share to judge our success.”

Haslingden candidly admits that the international channels business is “challenging”, but says that Fox International Channels has a five-to-10-year view about the business and having News Corp as a parent makes all the difference.

The biggest of Fox’s competitors are the other Hollywood studios from Disney to Sony to Warner Bros. Launching channels is always a delicate mix of negotiations around movie product, TV fare and any other programming rights that can be acquired.

But what Fox also brings to the table is News Corp – and the fact that News Corp owns part or all of many pay-TV platforms around the world, including BSkyB, Sky Italia and Star TV in Asia.

“The ability to launch channels right now depends on a distribution opportunity coming up,” says Haslingden. “That’s hard to find, but fortunately with News Corp we have lots of irons in the fire and we’re hoping that the distribution opportunities will come up more for us than for our competitors.”

Nevertheless, Haslingden admits that even with his connections, it took him nearly two years to get a deal for FX on BSkyB. “A number of our deals were up with Sky and we had a broad negotiation on a lot of levels about programming and other things, and an opportunity came up to launch a channel,” he says.

But some observers note that the FX deal was signed only after former BSkyB CEO Tony Ball had resigned and James Murdoch, News Corp chairman Rupert Murdoch’s son, was already in the frame to run BSkyB.

Haslingden says that even when he is working on a distribution deal with News Corp-controlled TV platforms the channel proposition has to be compelling or the deal won’t happen. The main sticking point with launching a Fox-owned channel on Sky was that a lot of Fox product had already been purchased by Sky One and other Sky channels.

If there had been any friction with Sky channels about programming rights, it was in abeyance at the launch party on 12 January. Sophie Turner-Laing, director of film channels and acquisitions for BSkyB, attended the party and gave the “thumbs up” sign when asked how she felt about the new channel in the Sky line-up.

Besides News Corp, Haslingden also has another big corporate connection through NBC which, along with Fox and National Geographic magazine, co-owns the Nat Geo and Adventure One channels internationally.

NBC’s recent purchase of the Universal TV assets, including Sci.Fi Channel and USA Network, from Vivendi could eventually add still more firepower.

In the near term, Haslingden has his eye set on Italy where News Corp recently merged two pay-TV platforms into one, renaming it Sky Italia.

Following in Flextech’s footsteps Fox International Channels already runs Nat Geo, Adventure One, Fox and the History Channel in Italy and Haslingden has a plan to launch another new channel there by April or May – and it is not FX. “We’d love in time to launch FX in Italy but we have to convince Sky Italia that we can source enough local programming to target the Italian ‘adult man’,” he says. “We already make money internationally as a whole, but it’s hard to do and that has several consequences. It means that I personally think that single channels can’t make the economic model work. Even single channels with a fabulous brand like Nat Geo will be challenged so the single channels will either go out of business or be bought up.”

The answer, according to Haslingden, is to put together portfolios of channels to “build scale”. “Once you have a group of channels like the ones we have in Italy and Spain then you can move people from channel to channel and take them places they might not ordinarily think they want to go.”

He says this is a similar philosophy to what Flextech is doing with its diverse group of channels in the UK. “Flextech is on to something in the UK,” says Haslingden. “At Fox in many of our international markets we are able to move audiences around from factual to movies to dramas to comedies and even to sports. And that in essence is a great multichannel TV service. If you can deliver a great multichannel TV service then you are delivering something that TV platforms like BSkyB and Sky Italia really want.”


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