Launch of Free Mobile
The launch of the fourth mobile network operator in France has so far met with dramatic success, gaining around 1.5 million subscribers in the first month, driven by rock-bottom pricing and a clever mass media PR campaign
Its tariffs are, however, so low that it is very hard to see how they are sustainable in the longer term. In the short term, Free’s economics are boosted by asymmetric voice and text termination rates that result in other operators’ customers effectively subsidising Free subscribers by €5 to €10 a month |
Media, Mobile, Telecoms |
February 2012 Access this report
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Cable & Wireless Worldwide: Turnaround or acquisition, easier said than done
Cable & Wireless Worldwide’s new CEO Gavin Darby has outlined a turnaround strategy for a business which is not performing that badly in context, against the backdrop of Vodafone considering a bid to buy the company
Mr Darby’s strategy is yet to be finalised, but in outline contains lots of initiatives which are good in theory but hard to implement in practice, especially in a weak macroeconomic climate, in the face of intense competition |
Mobile, Fixed line, Telecoms |
February 2012 Access this report
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Enders Analysis' Annual Conference
Enders Analysis co-hosted its annual conference, in conjunction with BNP Paribas and Deloitte, in London on 19 January 2012. The event featured talks by 13 of the most influential figures in media and telecoms, and was chaired by Sir Peter Bazalgette. An edited transcript of notes taken during the speaker presentations follows. |
Media, Technology, Telecoms |
February 2012 Access this report
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Virgin Media Q4 2011 results and strategy update: speed bumps
VMed’s Q4 results were again mixed, with underlying cash flow growth hit by high capital expenditure primarily relating to accelerating TiVo box installations
But this strong take up of next generation TV, and real progress at the Mobile and Business divisions, give us confidence that the company’s strategy is working
Management guidance of further cash flow growth from the second half of 2012 is credible, though we continue to expect underlying growth to be limited |
Media, Mobile, TV, Fixed line, Internet, Telecoms |
February 2012 Access this report
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Vodafone Q3 2011/12 results: Economic slowdown
Vodafone Europe’s underlying revenue growth declined by 0.7 percentage points in the December quarter, with its Southern European operations continuing to struggle in poor economic environments
Few competitors have reported their results so far, so it is hard to conclude on Vodafone’s competitive performance as yet, but we expect that the slowdown will prove market-wide
The company has stuck to its full year profitability targets, suggesting that strong cost cutting is making up for top line weakness |
Mobile, Telecoms |
February 2012 Access this report
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Platform wars, app stores and ecosystems
Around 125m smartphones and over 20m tablets were sold in Q4 2011. If tablets are included, Apple is now the largest PC manufacturer, while smartphones are now outselling PCs
These devices are the battleground for a war of ecosystems in which Apple’s iOS and Google’s Android platforms are dominant and others are hoping for third place at best. iOS and Android sold around 92m units in Q4 and now have an active base between them of around 515m devices
Samsung now accounts for at least half of Android sales and is in some senses more of a rival to Apple than Android itself |
Media, Technology, Telecoms |
February 2012 Access this report
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TTG FY 2011-12 Q3 trading update
Volume growth remained negative, but manageable, and there appears to be little evidence that TalkTalk’s value proposition is losing its appeal
Strong operating leverage, cost reduction and the growing popularity of uncapped bundles has enabled a significant upward revision to EBITDA guidance. However, free cash flow guidance remains unchanged
Management’s confidence regarding churn and further efficiency gains strikes us as credible, but we remain cautious about the potential for strong cash flow growth beyond this financial year |
Fixed line, Telecoms |
February 2012 Access this report
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Feeling the economic chill: Sky interim 2012 results
Sky’s 16% year-on-year increase in interim profits reflects strong operating efficiencies and reduced marketing costs due to the slowdown of TV gross additions in a tough economic climate, while continuing low churn underlines its product strengths
Fibre broadband deployment and the January launch of streaming-only services by Lovefilm and Netflix signal increasingly competitive conditions, but Sky is well placed and the challenges should take several years to materialise |
Media, TV, Fixed line, Telecoms |
February 2012 Access this report
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BT Q3 2011/12 results: reasonable progress, on balance
BT’s results for the December quarter saw continuing trends of gradual improvement at BT Retail and efficient deployment of next generation access at Openreach, plus strong control of unallocated property costs, enabling management to issue slightly improved group-level guidance for the current financial year to March
Cash flow growth at group level continued to be compromised by the cost of overseas expansion at Global Services and a continuing shift to LLU and IP-based services at BT Wholesale |
Media, Fixed line, Internet, Telecoms |
February 2012 Access this report
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Carphone Warehouse December quarter results: Weak prepay hits revenue, but strong contract supports profits
Carphone Warehouse’s Q3 2011/12 volume and revenue was severely hit by a steep reduction in UK prepay volumes, with prepay subsidy cuts driving a drop in the UK market of as much as 40%
However, stronger volumes of higher margin contract handsets drove a small improvement in gross profit for the quarter
The unexpected prepay weakness means that Carphone Warehouse’s handset business will have roughly flat operating profit in its 2011/12 financial year at best, although given the negative external factors this would reflect a strong underlying performance |
Mobile, Telecoms |
January 2012 Access this report
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Virgin Media's cable broadband speed upgrade: put that in your pipe
Virgin Media’s plan to double the line speed of most of its broadband customers is the latest in a series of moves to retain its position as the leading high speed internet service provider in the face of BT’s deployment of next generation access (NGA)
The move presages further price increases and an upgrade to offers for new cable customers, but is in the first instance about retaining the large existing base of cable customers currently on 10 Mbit/s |
Media, Fixed line, Internet, Telecoms |
January 2012 Access this report
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Pre-Christmas tablet market update
Apple has now sold 40m iPads – we estimate 4 to 5m in the UK – and goes into the Christmas season with no credible competitors beyond Amazon’s Kindle Fire, which is so far only available in the USA
Android phones are selling in huge numbers at half the price or less of the iPhone, but would-be iPad competitors are the same price or higher. With the continued absence of a meaningful content ecosystem for Android tablets it is hard to see consumers buying them in substantial numbers |
Media, Technology, Telecoms |
December 2011 Access this report
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UK broadband and telephony trends to Q3 2011, residential broadband projections to 2016
In this presentation we show our analysis of trends in UK broadband and telephony to September 2011, together with our latest projections for residential broadband subscribers and market shares to 2016. Highlights for the 2011 September quarter include accelerating growth in the number of subscribers to high speed broadband, and the continuing increase in market share of BT Retail and BSkyB at the expense of virtually all other players. This quarter’s edition includes a look at high speed broadband pricing, and our take on the new guidelines on broadband advertising. |
Fixed line, Telecoms |
December 2011 Access this report
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Mobile revenue growth and outlook Q3 2011: The outlook bleakens
In this presentation we show our analysis of revenue growth trends for mobile operators in the top five European markets (UK, Germany, France, Italy and Spain). The historical analysis is based on the published results of the operators, although they include our estimates where their data is inconsistent or not complete. A copy of the underlying data in spreadsheet format is available to our subscription clients on request |
Mobile, Telecoms |
November 2011 Access this report
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C&W Worldwide H1 2011/12 results
Cable &Wireless Worldwide’s performance for the six months to September was weak but made to look worse by one-offs
Underlying performance continues to be hit by strong competition and loss of voice revenue, but the impact of this has been made worse by underinvestment in data centres and neglect of the wholesale and SME businesses
The outlook for the year to March 2012 is poor, in line with the June warning. Beyond that, further investment in hosting and related capabilities will be necessary, and we continue to expect modest growth |
Fixed line, Telecoms |
November 2011 Access this report
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TalkTalk Group 2011/12 H1 results: continuing strong financial performance, cloudier longer term outlook
TalkTalk Group’s H1 results saw a disappointing increase in subscriber churn, causing a minor downward revision to revenue and volume guidance for the current financial year
Management is making good progress in reducing costs and the company remains on track to meet its financial guidance for the full year
Customer satisfaction is improving and subscriber volume is expected to stabilise by June 2012. But the strength of competition from BT Retail raises questions about the potential for future growth in revenue and hence cash flow |
Fixed line, Telecoms |
November 2011 Access this report
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Carphone Warehouse H1 2011/12 results: Late handset launches hurt
Carphone Warehouse’s H1 2011/12 results were overshadowed somewhat by the announcements that it is shutting down its UK ‘big box’ consumer electronics venture and selling its share in the Best Buy US handset business
Its actual core business operating performance was grim, with drops of 12% in volume and 4.5% in like-for-like revenue in the September quarter, with the slashing of prepay subsidies in the UK hitting volumes, and the late arrival of the iPhone 4S hitting revenue |
Mobile, Telecoms |
November 2011 Access this report
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Vodafone H1 2011/12 results: Doing well in difficult circumstances
Vodafone Europe’s service revenue growth improved marginally in the September quarter, a very solid performance under tricky circumstances, helped by good competitive performances and judicious pricing measures
The combined Europe and group common function EBITDA margin was again held flat, despite continued smartphone adoption pushing up handset costs, with strong cost control again evident |
Mobile, Telecoms |
November 2011 Access this report
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Nokia brings a new ball to the game
Nokia has launched its comeback with two very solid Windows Phone devices at €420 and €270. Next year Nokia, like Apple, will have handsets with uniquely appealing industrial design. However, Nokia will not launch in the USA until 2012 and needs to add cheaper smartphones to the portfolio
Nokia and Microsoft face a hard struggle in establishing a third mobile app ecosystem. However, it is not impossible (Google has managed it in 18 months) and given more devices and the right execution they could manage it |
Mobile, Technology, Telecoms |
November 2011 Access this report
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BT Q2 2011/12 results: light before the dawn?
BT reported its eighth successive quarter of strong growth in broadband volume and is aiming to complete deployment of next generation access one year early, yet within existing capex guidance for the group
Progress at Global Services and BT Wholesale is continuing, but remains very gradual
We continue to expect guidance for the current financial year to be met, though not significantly exceeded. But broadband momentum and excellent cost control suggest the prospects for FY2012/13 are improving |
Fixed line, Telecoms |
November 2011 Access this report
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