ECJ Murphy judgment - Who will win?
The European Court of Justice (ECJ) judgment in the Portsmouth pub landlady case looks to have opened the door to legitimising the private or domestic use of decoders to watch premium sports and other pay-TV content outside the territories for which they were licensed
The outcome could prove to be a significant commercial opportunity for Sky to expand its overseas distribution among residential customers, but an extra test for the Football Association Premier League (PL) as it designs the next round of contracts with a view to at least maintaining current revenues |
Media, TV |
October 2011 Access this report
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Video streaming and news online
The UK is now entering a period of intense discussion of the regulation and ownership of news outlets. In this context it is revealing to look at a case study of news viewing online
Livestation is an online service which aggregates several dozen TV news channels and makes them available online. Two of the most prominent are Al Jazeera and Al Arabiya. These channels experienced explosive growth during the ‘Arab Spring’ events, and this was reflected in the statistics for access to their online streams, which we analyse here |
Media, TV, Internet |
September 2011 Access this report
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Local TV: watch this space
Jeremy Hunt is pressing ahead with plans to inject television into the local media ecosystem, the latest in a series of attempts by successive governments to promote local news provision
This presents a challenge to local media, threatening to fragment consumption and intensify the competitive environment in perennially difficult times, but in certain areas these pressures will be attenuated
A ‘community’ model may allow local TV services to survive in areas where advertising revenues do not provide a sufficient income stream |
Media, TV, Press |
September 2011 Access this report
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Google TV in the UK: friends with few benefits
Nearly a year after rolling out Google TV in the US, Google has confirmed plans to launch its ‘smart TV’ operating platform in Europe and the UK by early 2012
To date, Google TV in the US has been a disappointment, with little broadcaster support and, until recently, expensive devices, resulting in low adoption
The content issue is likely to dog Google TV, both here and in other European markets; access to key broadcaster TV and video programming will be a major challenge |
Media, TV, Internet, Technology |
September 2011 Access this report
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Canal+ bursts into free TV
Advancing its free-to-air TV project, France’s Canal+ is to buy Bolloré TV’s national channels for €465 million to gain (scarce) licences for FTA terrestrial broadcast
Canal+ plans to leverage its library of original programming to attract upscale audiences, neglected by commercial rivals
However, the Vivendi investment case of a 9% return on capital is built on incompatible assumptions about profit margins and market share – to grow the latter in a mature market, a channel needs to sacrifice the former |
Media, TV |
September 2011 Access this report
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UK advertising growth slows to a crawl
Whilst UK GDP growth crawls along at a snail’s pace in 2011, (real) private consumption, its principal component, has been in sequential decline since Q4 2010, dragging consumer facing industries down
UK media are not equally affected. The internet continues to grow through search as well as display, but we expect TV NAR to be flat in 2011
Press advertising is worst affected by the downturn due to its exposure to retail advertising on top of the structural shift of classifieds to the internet |
Media, TV, Press, Internet, Music and Radio |
September 2011 Access this report
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Sky Movies: the Competition Commission investigates
The provisional findings of the Competition Commission’s (CC) investigation into pay-TV echoed the conclusions of the Ofcom pay-TV investigation in April 2010, concluding that Sky’s control of pay-TV movie rights was having an adverse effect on competition
The big difference between the CC and Ofcom lies in the choice of remedy, with the CC preferring to explore a range of other options rather than proceed with Wholesale Must Offer, a solution that the CC sees as entrenching Sky’s market power rather than undermining it |
Media, TV |
August 2011 Access this report
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Starting the transformation: ITV interim 2011 results
ITV reported strong year-on-year growth in profits in H1 2011, enabling a substantial reduction of net debt and putting the company in a stronger position to invest in growth as it pursues its five year transformation plan
Important to longer term success, ITV Family share of viewing has held up, and ITV looks well placed to expand its market share of TV NAR (Net Advertising Revenue) over the next two years, albeit in an uncertain and challenging economic environment |
Media, TV |
August 2011 Access this report
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Sky FY 2011 results: excellent year of delivery
Fiscal 2011 was a vintage year for Sky, which reported a 23% growth in operating profit and 51% increase in free cash flow as it started to reap the full benefits of its investment in multi-product growth
Q4 2011 showed signs that tougher economic conditions are starting to bite, although the sharp fall in TV product additions was balanced by a fourth consecutive bumper quarter in home communications, in which Sky outperformed the rest of the market |
Media, TV, Fixed line, Telecoms |
August 2011 Access this report
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UK video-on-demand forecasts to 2015
This presentation details our assessment of the UK prospects for video-on-demand advertising through to 2015, covering through-the-middle and over-the-top services
While video-on-demand consumption is set to grow strongly, particularly to the TV, linear broadcast services, supported by PVR timeshift, will continue to account for over 90% of viewing to the TV and PC/ tablet over the next five years. As a result, we forecast that VOD advertising will equate to 7% of TV NAR by 2015, with current high prices for in-stream video ads falling as it becomes more integrated with TV airtime sales |
Media, TV, Internet |
August 2011 Access this report
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Virgin Media Q2 2011 results: resilient but with limits
VMed’s Q2 results were respectable, but quirky, with resilient underlying revenue and strong cash flow, but exceptionally weak cable volumes
Virgin Mobile is performing better than ever, but steam continues to seep from the cable cash flow boiler
A TiVo push and further progress at Virgin Media Business are still to come, but we expect a trend of gradual decline in fundamental cash flow growth |
Media, Mobile, TV, Fixed line, Internet, Telecoms |
July 2011 Access this report
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Update on BSkyB forecasts
All the recent attention to BSkyB has had to do with the proposed News Corporation takeover and its impact on the share price. For the BSkyB business itself, we think the troubles of News International have so far had very little effect, as there is nothing to link the pay-TV operator Sky directly with the News of the World, the epicentre of the current judicial and political storm. Nothing, that is, apart from the Murdoch factor, which certainly seemed to do no harm to sales of the final News of the World edition on Sunday 10 July which topped 4.5 million. |
Media, TV, Fixed line, Telecoms |
July 2011 Access this report
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What does ‘fit and proper’ mean?
Ofcom is entitled to consider whether News Corp is ‘fit and proper’ to own BSkyB’s channels, not the company itself
Precedent suggests that Ofcom will only be able to conclude that News Corp is unfit if the acquiring company’s directors are found guilty of a serious criminal offence. Suspicions, allegations and mistrust are absolutely not enough
We believe that Ofcom will only be able to assess whether News Corp is ‘fit and proper’ to own Sky channels after the transaction is concluded |
Media, TV, Fixed line, Press, Telecoms |
July 2011 Access this report
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The proposed acquisition of BSkyB: the process from now on
We expect Jeremy Hunt to announce the fine details of the proposal to give editorial independence to Sky News within the next few days. After a perfunctory further consultation, the regulatory barriers to the purchase of BSkyB by News Corp will be cleared in July
News Corp will need to reach agreement with BSkyB over price and only then can proceed with its proposal for a ‘scheme of agreement’ to take over the company. We expect the purchase to be concluded by about the middle of October if BSkyB cooperates, but early in 2012 if News Corp is forced to use a takeover bid |
Media, TV |
June 2011 Access this report
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Football auction unsettles Canal+
France’s Canal+ has won the rights to show two Ligue 1 games a week from 2012 to 2016 for €420 million per year. A surprise (and skilful) bid by Qatar’s Al Jazeera won two lower profile games for €90 million per year
We believe Al Jazeera could, at best, reach EBITDA break even by the end of the four year licence. Merging with CFoot and Orange sport would help |
Media, TV |
June 2011 Access this report
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News Corp proposed takeover of BSkyB
In the attached note we present our analysis of BSkyB revenue and cost trends over the five years 2006 - 2010 and our forecasts to 2015 |
Media, TV, Fixed line, Telecoms |
June 2011 Access this report
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Sunshine to showers: TV 2011 advertising update
We have revised our central case forecasts of total year-on-year NAR (Net Advertising Revenue) growth in 2011 from 5% to 1%, as the advertising outlook has progressively worsened since mid April
2011 is marked by a further round of consolidation in airtime sales and a number of noteworthy channel and programming changes
Channel 4 Sales, and above all its flagship Channel 4, appears the most challenged of the leading market players, while we expect the ITV group to continue to outperform the NAR market in the rest of 2011 and 2012 |
Media, TV |
June 2011 Access this report
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Sky Deutschland on the mend
Sky’s revamped model has delivered a sharp reduction in churn and higher gross additions, accelerating subscriber growth. Rising high definition take-up is sustaining the increase in average revenue per user
Business prospects are improving on stronger private consumption and a carriage deal for HD versions of German commercial channels
Our forecasts have been revised upwards and we now expect faster improvement in cash flow, though it will still be negative in 2013 |
Media, TV |
May 2011 Access this report
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Strong underlying growth trajectory: Sky fiscal Q3 2011 results
Sky is managing to sustain strong underlying growth in the face of a challenging retail environment, in which it has maintained strong growth rates in quarterly gross TV additions and home communications products
Revenues were slightly down on the previous quarter, but this was mainly due to the January increase in VAT and seasonal variations in advertising spend, while the results confirmed the company’s strong discretionary control over costs |
Media, TV, Fixed line, Telecoms |
April 2011 Access this report
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Virgin Media Q1 2011 results: still respectable, but growth dropping
VMed’s Q1 results were respectable, helped by strong revenue growth at Virgin Media Business
However, growth in volume, ARPU and OCF, while still positive, is trending downwards, and we retain our expectation of more limited progress in 2011 compared to 2010
VMed’s strategy is coherent; the issue is the pace at which initiatives such as high speed broadband, service convergence and footprint expansion can be converted into cash flow growth |
Media, Mobile, TV, Fixed line, Telecoms |
April 2011 Access this report
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