Dive Brief:
- 21st Century Fox's FX Networks and Comcast Corp. are launching a premium, ad-free channel called FX+, according to The Wall Street Journal. The offering costs an extra $5.99 per month for Comcast Xfinity subscribers and includes FX shows like "American Horror Story" and "It’s Always Sunny in Philadelphia," which will air at the same time they do on the main cable channel. FX+ will also include content from FX's sister channel FXX.
- FX+ is expected to launch Sept. 5 and is the second ad-free version of an established cable network provided by Comcast. In late June, AMC announced AMC Premiere, which similarly costs Comcast viewers an extra $4.99 per month for ad-free access to shows like "The Walking Dead" and "Preacher."
- Both premium options are add ons to existing cable subscriptions. FX+ will put its parent company on equal footing with premium networks and also streaming services, FX Networks Chief Executive John Landgraf told the Journal.
Dive Insight:
Cable and network TV are finding themselves at a crossroads in 2017. Myriad issues with digital advertising have led some major advertisers including Procter & Gamble and Yum! Brands' Taco Bell to recommit to TV ad budgets, as the channel is seen as a more stable and assured bet. On the other hand, more viewers are cutting the cord and favoring digital streaming options, which has hurt ratings overall but done little to get networks to budge on lowering their pricier ad rates — a stubbornness that's caused frustration with marketers.
While Comcast and networks like FX and AMC are experimenting in offering ad-free options that align closer to the viewing experience of online subscription services like Netflix, it remains to be seen if this model can draw in a big enough audience to bolster business. A Comcast subscriber signing up for the new premium channels would be adding more than $130 per year to their cable bill. On top of that, only existing cable subscribers can get the new channels, so it's highly unlikely they will bring anyone who has already cut the cord back into the fold.
Cable networks are also walking something of a tightrope with advertisers. Both FX+ and AMC Premiere target an engaged, high-return audience that loves their programming. Brands might lose their ability to reach that prime time audience if the commercial-free offerings see the traction the networks are hoping they do.
