Latest / What the Flux / Foxtel up for sale | Mosaic Brands' financial tightrope | Life360 cracks a new milestone

Transcript

Foxtel up for sale | Mosaic Brands' financial tightrope | Life360 cracks a new milestone · What the Flux

• 0:05
  Speaker 1: This is what the Flux.
• 0:06
  Speaker 2: I'm Brett and I'm Justin and it's Monday, the twelfth
• 0:09
  Speaker 2: of August.
• 0:09
  Speaker 1: Study boy. You may have noticed Meta's new AI chat
• 0:12
  Speaker 1: fot over the past few weeks on install, Facebook, WhatsApp. Now,
• 0:15
  Speaker 1: the problem is it isn't very smart. Reports are that
• 0:18
  Speaker 1: it's failing some pretty simple year eight math.
• 0:21
  Speaker 2: Wow.
• 0:21
  Speaker 1: So the big question is have can you trusted to
• 0:23
  Speaker 1: write your UNI essay when it can't even solve a
• 0:26
  Speaker 1: basic maths problem.
• 0:28
  Speaker 2: Lots of hallucinations going on, b man, uh huh. Now
• 0:30
  Speaker 2: the numbers are in sixty six percent of Flux users
• 0:32
  Speaker 2: have no idea how many subscriptions they've got Netflix and
• 0:36
  Speaker 2: Spotify and Amazon Prime, Apple, like Cloud Gym memberships. Honestly,
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  Speaker 2: it never ends, and that's why we're so excited to
• 0:41
  Speaker 2: launch the Flux Subscription track app. It takes thirty seconds
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  Speaker 2: identify all of the subscriptions in the one spot, including
• 0:49
  Speaker 2: when they are coming out. The man, I've gotta be honest,
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  Speaker 2: it's already saved me hundreds of dollars. So flox am
• 0:53
  Speaker 2: if you want to see all your suscriptions in one spot.
• 0:55
  Speaker 2: Make sure to check it out in the budgeting feature
• 0:57
  Speaker 2: of the Flux app.
• 0:58
  Speaker 1: Three two good to be true stories Today, Juzzy Boys,
• 1:01
  Speaker 1: let's do it for our first NewsCorp. The publishing behemoth
• 1:05
  Speaker 1: has officially put Foxtel and its streaming services up for sale.
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  Speaker 2: Just really starting to turn that Foxtel ship for around
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  Speaker 2: by man, so tell me more so.
• 1:13
  Speaker 1: Juzzy Boy News Corp. Is the company behind a whole
• 1:15
  Speaker 1: heap of newspapers like The Herald Sun and The Australian.
• 1:18
  Speaker 2: As well as the Wall Street Journal and the majority
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  Speaker 2: stake in the Aria Group, which is the owner of
• 1:22
  Speaker 2: real estate dot com dot AU.
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  Speaker 1: Oh and they also happen to own sixty five percent
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  Speaker 1: of Foxtel.
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  Speaker 2: The other thirty five percent is owned by the tell
• 1:30
  Speaker 2: part of the name that'd be Telstrat.
• 1:31
  Speaker 1: And that was when they joined forces and launched Foxtel
• 1:34
  Speaker 1: in nineteen and ninety five.
• 1:36
  Speaker 2: Man Well, Foxdale's PATV was the go to service in
• 1:38
  Speaker 2: its heyday. Its subscriber numbers have been rapidly declining over
• 1:42
  Speaker 2: the past five.
• 1:42
  Speaker 1: Years, mainly thank you to the growth of streaming services.
• 1:46
  Speaker 2: In fact, there are only now around one and a
• 1:48
  Speaker 2: half million fox stale subscribers in Australia.
• 1:50
  Speaker 1: But Foxdale rolled out ko It's sports streaming service.
• 1:53
  Speaker 2: It rolled out binge it's entertainment streaming service.
• 1:55
  Speaker 1: It also rolled out Flash, its new streaming service, which
• 1:58
  Speaker 1: I use daily Judge.
• 2:00
  Speaker 2: I didn't at its total fox sale subscriber base has
• 2:03
  Speaker 2: grown back to four point seven million people.
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  Speaker 1: But now juzzy Boy News Corp has said that Foxtel
• 2:08
  Speaker 1: is up for sale for about the tenth time. Foxel
• 2:12
  Speaker 1: claims that it has received third party interest.
• 2:15
  Speaker 2: But getting Foxtel back to peak profitability might just be
• 2:18
  Speaker 2: too hard for News Corp.
• 2:19
  Speaker 1: So what is the key learning here?
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  Speaker 2: The shift to digital content might be easy for viewers,
• 2:23
  Speaker 2: but it's very hard on the margins of old school
• 2:26
  Speaker 2: players YEP.
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  Speaker 1: Streaming platforms like Netflix, Disney Plus even ko Sports offer
• 2:30
  Speaker 1: consumers the flexibility to watch their content on demand, but.
• 2:34
  Speaker 2: Be man, it comes at a lower cost than traditional
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  Speaker 2: pay TV subscriptions.
• 2:37
  Speaker 1: Foxdel generates an average of ninety bucks per month from
• 2:40
  Speaker 1: its set top box customers.
• 2:42
  Speaker 2: Compare that to streaming services, which are less than a
• 2:44
  Speaker 2: quarter of the price.
• 2:45
  Speaker 1: And as a result, streaming services typically have leaner profit
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  Speaker 1: margins compared to traditional PATV.
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  Speaker 2: In fact, be Man, Foxell's, Ko and Binge and Foxel
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  Speaker 2: now makes up sixty six percent of their customer base
• 2:56
  Speaker 2: but only twenty three percent of their revenue.
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  Speaker 1: So Fox has struggled to balance its legacy PATV business
• 3:02
  Speaker 1: with the growth of competitor streaming services.
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  Speaker 2: And clearly NewsCorp wants to hand all this problem to
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  Speaker 2: the new owners by putting it up for sale.
• 3:10
  Speaker 1: For our second story, the parent company of clothing brands Millers,
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  Speaker 1: Katie's and Nonybe saw its share price dropped by more
• 3:17
  Speaker 1: than forty percent last week as it struggles to stay afloat.
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  Speaker 2: Jeez, some physical retailers getting hit hard at the moment
• 3:23
  Speaker 2: be manned, so tell me more well.
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  Speaker 1: Mosaic Brands is the parent company which specializes in women's
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  Speaker 1: budget clothing brands.
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  Speaker 2: We're talking Nonybe, Katies, Millers, Rockman's, Rivers and four other
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  Speaker 2: brands as.
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  Speaker 1: Well and Josey Wait. Although these brands may not be
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  Speaker 1: where you shop, they are a seriously large outfit.
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  Speaker 2: We're talking four thousand staff in seven hundred stores across Australia.
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  Speaker 1: But when COVID hit they had to shut their stores
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  Speaker 1: down and weren't really set up well for the whole
• 3:47
  Speaker 1: online store fan.
• 3:48
  Speaker 2: They got whacked with one hundred and seventy million dollars
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  Speaker 2: lous in twenty twenty and haven't really been the same
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  Speaker 2: ever since.
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  Speaker 1: So last week Mosaic Brands announced a trading halt.
• 3:57
  Speaker 2: Basically so could look at ways to restructure and refine.
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  Speaker 2: It's the company and James Boy.
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  Speaker 1: It's fair to say that investors didn't take to this
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  Speaker 1: very well.
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  Speaker 2: Who no, no no. In fact, Mosaic's share price dropped
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  Speaker 2: over forty three percent during the week when it wasn't
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  Speaker 2: in its trading hold.
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  Speaker 1: But one of the biggest challenges for Mosaic Brands is
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  Speaker 1: that the majority of its brands actually compete against each other.
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  Speaker 2: Oh no, no, no, So tell me they man, what
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  Speaker 2: is the key leading here?
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  Speaker 1: Market cannibalization can be a huge issue for companies that
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  Speaker 1: own multiple brands targeting the same customer or the same audience, so.
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  Speaker 2: Theyman on face value. Having multiple brands in the same
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  Speaker 2: industry kind of sounds like a pretty good strategy to
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  Speaker 2: dominate that market.
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  Speaker 1: Yeah, but it can backfire too, because instead of attracting
• 4:36
  Speaker 1: a wider audience, the brands end up competing against each
• 4:38
  Speaker 1: other for the same customer, and.
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  Speaker 2: This can lead to unnecessary competition within the broader company, and.
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  Speaker 1: It can drive up costs for separate staff and advertising
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  Speaker 1: and logistics, and theybanned.
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  Speaker 2: This was the same problem that West Farmers faced with
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  Speaker 2: Kmart and Target back in the day.
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  Speaker 1: That's right, those two discount department stores essentially competed for
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  Speaker 1: the same kind of customer.
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  Speaker 2: And then they realized that Target just couldn't compete with
• 4:58
  Speaker 2: Kmart's cheap, cheap prices. It ended up dropping Target store
• 5:01
  Speaker 2: numbers from almost three hundred to just over one twenty.
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  Speaker 2: For our third and final story, Life three sixty share
• 5:06
  Speaker 2: prices hit an all time high as across the seventy
• 5:09
  Speaker 2: million user bar. Wow.
• 5:11
  Speaker 1: Wait, Juzzi boy, you got to say that is a
• 5:12
  Speaker 1: lot of helicopter parents. Tell me what is going on here?
• 5:15
  Speaker 2: Okay? So, Life three sixty is the family social networking
• 5:18
  Speaker 2: app founded in two thousand and eight in San Francisco,
• 5:20
  Speaker 2: but it's actually listed on the ASX.
• 5:22
  Speaker 1: It's a subscription based platform that basically lets family and
• 5:25
  Speaker 1: friends track each other's location and.
• 5:27
  Speaker 2: They're driving speeds.
• 5:29
  Speaker 1: I know it's borderline creepy, but it's definitely proven to
• 5:31
  Speaker 1: be very popular.
• 5:32
  Speaker 2: Yeah. In fact, Life three sixties just announced that it's
• 5:34
  Speaker 2: hit seventy million users.
• 5:36
  Speaker 1: On its app and this new cent Life three sixty
• 5:38
  Speaker 1: shares fly and I'm talking eighteen percent to an all
• 5:40
  Speaker 1: time high.
• 5:41
  Speaker 2: They also up their revenue guidance and they're expecting to
• 5:43
  Speaker 2: make three hundred and seventy eight million US dollars in
• 5:45
  Speaker 2: annual revenue.
• 5:46
  Speaker 1: But josey boy, that's not all investors were excited about.
• 5:49
  Speaker 2: Oh no, no, no. Live three sixty also announced its
• 5:51
  Speaker 2: other revenue, which includes this new ad business, grew twelve
• 5:53
  Speaker 2: percent for the June quarter.
• 5:55
  Speaker 1: And it's planning to expand its AD business this year
• 5:57
  Speaker 1: to unlock more revenue opportunity. So what is the key
• 6:01
  Speaker 1: learning heat First it was ads, then it was subscriptions,
• 6:03
  Speaker 1: and now it's subscriptions plus ads. Man, Remember when the
• 6:06
  Speaker 1: famous phrase used to be, if you're not paying for
• 6:08
  Speaker 1: the product, you are the product. I actually do remember
• 6:11
  Speaker 1: that very well, jus boy, But.
• 6:12
  Speaker 2: It's not so true anymore, because now you can be
• 6:14
  Speaker 2: paying for the product by a subscription and be the
• 6:16
  Speaker 2: product through ads.
• 6:18
  Speaker 1: And you see, juzzy boy. Many businesses that start with
• 6:20
  Speaker 1: an ad based revenue model have switched it up to
• 6:23
  Speaker 1: a subscription based revenue model to expand their earning potential.
• 6:26
  Speaker 2: But now we're else seeing subscription based businesses expand their
• 6:29
  Speaker 2: earning potential through ads.
• 6:31
  Speaker 1: Yeah, think Netflix with its new ad tier, and Disney's
• 6:34
  Speaker 1: also going to introduce ads soon.
• 6:35
  Speaker 2: Our old customers might not be too jazzed about this.
• 6:37
  Speaker 2: Investors are habitable. Man. Is there any worse feeling than
• 6:40
  Speaker 2: seeing a subscription that you haven't used in months but
• 6:43
  Speaker 2: you're paying for it?
• 6:43
  Speaker 1: Agonizing, genuinely painful stuff.
• 6:45
  Speaker 2: But even better when you cancel it and realize it
• 6:47
  Speaker 2: you're saving money out. We've got that all covered for
• 6:49
  Speaker 2: you in the Flux apps. Make sure you check it
• 6:51
  Speaker 2: out in the budgeting feature today.
• 6:52
  Speaker 1: Thanks for listening, and we'll see you on Wednesday.