Take a look at Netflix if you want some relief from the sea of red in share performances. Over the past week in particular it has performed strongly - up 16 per cent. Take a look at the stock prices of US cable companies and the trajectory has moved in the opposite direction.

The reason is simple. Cable/satellite companies are reliant on sports programming to attract and retain subscribers. In the space of a week that has dried up.

No crowds and now no games. Getty

In Australia there is only one cable company of note - News Corporation’s Foxtel. It also owns the streaming service Kayo. Foxtel’s main broadcast platform is highly dependent on sport and Kayo is a sport only service. Far from a picture of corporate health before COVID-19 hit, Foxtel now faces a bigger crisis.

Marquee sports have disappeared as various governments around the world have banned (initially) spectators from attending venues and more recently the actual playing of sports. In Australia the major winter football codes, AFL and the NRL, have cancelled the season games until further notice. It is difficult to imagine that play will resume before the end of winter.

It is almost certain that subscriptions for Foxtel will be hit badly and Kayo, in particular, will experience a massive decline over the period in which the coronavirus affects the playing of professional sport.

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Making matters worse, Foxtel’s advertising revenue will likely also fall into a hole. This would be consistent with local media players such as Nine Entertainment (the publisher of this masthead) and Seven West Media, both of which have withdrawn 2020 earnings guidance in recent days, warning of no visibility on forward ad bookings.

Many companies are expected to cut back on advertising as they slash costs to stay afloat as demand for their goods and services falls and the broader economy faces recession. However, Foxtel was in a difficult position before the pandemic surfaced.

It has been operating with the support of its major shareholder, Rupert Murdoch’s News Corporation, for a year. Initially, News lent Foxtel $300 million to repay its creditors. The support has since ballooned to $900 million while Foxtel’s other shareholder Telstra has recently come to the party.

In February, Telstra extended Foxtel a $170 million loan in order for Foxtel to pay Telstra the fees it pays for using its cables to deliver pay TV to consumers.

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Foxtel’s traditional broadcast business experienced churn of near 16 per cent in the December quarter. And over the past few years it had already been forced to lower its subscription rates to compete with the growing new breed of video streaming companies such as Stan, Netflix, Disney and Prime.

At News Corp’s February second-quarter results briefing the company revealed a surprise slump in subscribers from Kayo. This was supposed to be Foxtel’s growth engine but rather than gaining new customers it lost 32,000 between November 5 and February 5 - an outcome that News Corp boss Robert Thomson blamed on a poor showing from Australian cricket.

Foxtel's broadcast and commercial subscriber base was at 2.268 million as of December 31, down from 2.326 million in the September quarter.

Foxtel Now – a streaming version of Foxtel's traditional broadcast business – had 334,000 paying subscribers as of December 31, down from 375,000 in the previous quarter. Foxtel Now also received a one-off hit from the last season of Game of Thrones in the middle of the year.

For the six months to December News Corp’s earnings from the subscription video segment was down 23 per cent on the same period a year earlier. The unanswerable question is what will happen to subscription numbers when the pandemic is over.

The structural forces that are challenging Foxtel won’t go away. And will those that cancel their subscriptions come back in six months?