Fox in Talks to Acquire Free-Streaming Service Tubi for Over $500 Million (Report)

Courtesy of Tubi

Fox Corp. is in discussions about acquiring Tubi, the ad-supported free streaming service, in a deal worth more than $500 million, according to a Wall Street Journal report citing anonymous sources.

With Tubi, Rupert Murdoch’s TV broadcasting and cable company would be adding a dedicated streaming component — offering over 20,000 older TV shows and movies to watch for free — to its portfolio to capture the surge in internet-video viewing.

Reps for Fox Corp. and Tubi rep declined to comment.

Fox Corp.’s business comprises Fox Broadcasting and local TV stations, Fox News and Fox Business, and Fox Sports, after the dismantling of 21st Century Fox and the sale of most of 20th Century Fox’s assets to Disney last year.

The report of Fox’s interest in Tubi comes amid a surge of activity in the ad-supported streaming space. Last year, Viacom (now ViacomCBS) acquired free-streamer Pluto TV for $340 million in cash. Other players vying for eyeballs with premium free video services include the Roku Channel, Amazon’s IMDb TV, and Walmart’s Vudu, while this summer Comcast and NBCUniversal are planning to launch a free, ad-supported version of the Peacock streaming service.

In other potential M&A activity, NBCU is in negotiations to buy Walmart’s Vudu movie and TV show streaming division, which includes a free AVOD tier with some 10,000 titles.

Tubi was founded as AdRise, a video ad-tech startup in 2010. It launched Tubi TV in 2014 and eventually changed its name and focus to ad-supported VOD. The company has raised $34 million from investors including Lionsgate, MGM, Jump Capital, Cota Capital, Foundation Capital, Streamlined Ventures and individuals including Bobby Yazdani, Mark Amin, and Noosheen and Zod Nazem.

Tubi offers 20,000 library movies and TV series — all for free with ads — from over 250 content partners including Warner Bros., Paramount, Lionsgate and NBCUniversal.

In December 2019, according to Tubi, its monthly active user base grew to 25 million (up from 20 million six months earlier) while total viewing time hit over 163 million hours watched, a 160% year-over-year increase. (The figures aren’t independently verified.) Last year, Tubi said, headcount increased 78% to over 229 full-time employees.

In 2020, Tubi said its content spending will “exceed nine figures,” or more than $100 million, to expand on its current library. Last year Tubi pegged content spending at about $100 million.