Publications

Format: Jun 2018
sort descending Sector(s) Date
Channel 5 sold

Northern & Shell has concluded the sale of the Channel 5 Group for the price of £450 million, a little over midway between the £103 million spent on acquiring Channel 5 from RTL in 2010 and the quoted target price of £700 million at the beginning of the year

Channel 5’s fourth place in the strong and buoyant UK advertising market, its PSB privileges and current audience and operating performance make it a rare and attractive opportunity for US groups like Viacom seeking to expand their international footprint

Among the challenges facing Viacom are the integration of the free-to-air Channel 5 Group reaching a broad audience with its own largely pay-TV channels aimed at the younger age groups. In the process, we expect Viacom to deepen its ties with Sky, including advertising sales, where further consolidation appears likely

  • Five
TV, Media 1 May 2014
Channel 5 up for sale?

Richard Desmond’s appointment of Barclays to explore the sale of the Channel 5 Group in 2013 has fuelled speculation over prospective purchasers should Northern & Shell be intent on selling this asset

The reported target of at least £700 million, seven times the £103.5 million paid by Northern & Shell to RTL three years ago, reflects a strong performance in 2013, but needs to be against several distinctive factors, including Channel 5’s near total reliance on advertising and the cross-promotional benefits it gains from the Northern & Shell print publications

Regulatory and strategic considerations suggest that neither ITV nor the pay-TV platform operators, Sky and BT, are likely to emerge as serious bidders and that an overseas group from the US is the most likely outcome if a sale is to take place

  • Sky
  • ITV
  • BT
TV, Media 10 January 2014
Channel 5: three years on from Viacom's acquisition

Viacom’s 2014 acquisition of Channel 5 from Richard Desmond’s Northern & Shell occurred while the maelstrom encircling linear television viewing—sparked by the allure of SVODs and other digital distractions—was well underway

Nevertheless, with increased content spend, development of new titles and clarity as to its targeted audience, the broadcaster has increased its channel (and group) share amongst 16-34s and ABC1s, and has directed further benefits back to its owner's existing entertainment suite

Outside of the post-lunch and 8-10pm slots, however, work needs to be done: Channel 5’s BVOD proposition and social media offering leaves much to be desired, while the reliance on two major titles, Big Brother and Neighbours will be unsustainable in a post-linear world  

  • Channel 4
  • Five
  • Viacom
Media, TV 1 December 2017
Channel Four 2008 annual report: bridging the funding gap

Channel 4 broke even in 2008 despite a 5% fall in total TV NAR (net advertising revenues), through a combination of outperforming the market and £25 million in programme budget cuts. Its annual report also underlined its credentials as the alternative PSB voice, based on market research conducted over the year

The crunch time is likely to come in 2009 and 2010. Although financially better placed in many ways than ITV, and more flexible over committed programme spend, the recession threatens Channel 4 with a cumulative annual net deficit of around £150 million in 2010 without further action

Financial pressures facing Channel 4 highlight the need for urgent government action, in the absence of which much depends on the outcome of Virgin Media’s efforts to sell its content assets and the ultimate willingness of BBC Worldwide to engage in a JV with Channel 4. Consolidation would help even if it did not solve all of Channel 4’s pressing financial concerns

  • Channel 4
Media, TV 6 May 2009
Channel Netflix

Netflix H2 2013 results show continuing steady expansion in its domestic US and international streaming businesses, mostly towards the upper end of company guidance Netflix has always posed as a disruptor, yet there is nothing revolutionary in its business model or content origination strategy, while confidence in the future owes much to growing acceptance of Netflix as another channel outlet by incumbent content owners Although Netflix releases no international streaming data by country, there is some evidence to suggest it is edging towards two million in the UK; but is still on a tightrope as it races to add subscribers and revenues to cover its fast growing and somewhat shrouded content obligations

Technology, Internet, TV, Media 20 August 2013
Channelling strength: Virgin Media Q2 2016 results

Virgin Media had its strongest June quarter since 2008 with 43k broadband net adds (31% of market net adds), of which Project Lightning contributed less than half. Current momentum remains largely dual play with continuing, though stable, net losses in the TV base

Content investments, and an upgraded UI and STB will be at the centre of TV promotions as refreshed triple play bundles are launched towards the end of the year in a bid to reinvigorate premium pay TV competition. In a saturated premium pay TV market, base stabilisation should be the near term target

Pressure on revenue growth from price increase mechanics, discounting, one-offs and other factors are set to ease from next quarter, in tandem with increased Project Lightning contributions. As we enter the football season, attention turns to wholesale content costs following a record breaking rights auction last year

  • Virgin Media
Fixed Line, Telecoms 12 August 2016
Children's changing video habits and implications for the content market

Children’s media use and attitudes have dramatically changed over the last few years, stemming from the rapid take-up of smartphones and tablets

Traditional TV continues to decline at the expense of newer video services such as YouTube, Netflix and Amazon, with 43% of children aged 8-15 preferring YouTube videos over TV programmes

These online services offer content producers wider opportunities, but questions remain around the lack of regulation online, and the recent scandal around children’s safety on YouTube has heightened these concerns

  • Amazon
  • BBC
  • Google
  • Netflix
  • Sky
  • Virgin Media
  • Walt Disney
  • YouTube
Media, TV, UK Media 8 December 2017
China OTT and SVOD

China holds tremendous appeal to studios and OTT video services, boasting an audience of 460 million online video users in mid-2015 (69% of internet users), which could exceed 900 million by 2020 by our estimate

China’s OTT video marketplace generated estimated revenues of $5 billion in 2015, of which two-thirds was due to ad-supported streaming and the rest to paid video streaming

Netflix recently pledged to enter China, although the current regulatory environment presents substantial, perhaps insurmountable, challenges to a direct-to-consumer offering

Non-UK Media, Media, Mobile, Technology, TV 1 February 2016
Chinese online media platforms

Baidu, Alibaba, and Tencent (BAT) have built their leading market positions in Chinese online media on the back of the mobile revolution and an absence of foreign rivals

The big three’s rivalry in online advertising reflects a broader struggle over key gatekeeper roles in the Chinese online economy, albeit one shaped by state intervention

While benefiting from protectionism at home, BAT are weak in most foreign markets and links to the Chinese state may hamper international expansion, particularly in the US 

Non-UK Media, Internet, Media, Mobile 31 January 2018
Churn

Little research has been done into why consumers move from one supplier to another. Churn, as this phenomenon is known, is much discussed but little understood. We carried out some research to show what types of people churn, why they do it, and whether it is an outcome of a certain type of personality.

Telecoms 7 March 2003
Clash of the retail titans: Amazon vs Walmart

The battle in the US between Amazon, ecommerce giant, and Walmart, the retail titan, reflects the changing face of US retail as online drives growth

Amazon, the everything store, innovates on marketplace, warehouse and logistics, and customer tools like Prime, while Walmart fortifies in-store and builds on its strengths 

Walmart cannot overtake Amazon online, but it can defend its position as the largest US retailer as Amazon drives an ecommerce future for retailing 

 

 

 

  • Amazon
Internet, Media, Technology, Telecoms 28 September 2016
Classified Advertising in Print and Online

The UK newspaper industry is being engulfed by a 'perfect storm'. Overall advertising has been in a cyclical downturn since mid-2005, and public sector recruitment in particular has been weak, while readers desert newspapers (even free ones) for the internet, to which they are drawing spend on classified and display advertising. We view classified advertising in print media as being in permanent decline, anticipating an overall drop from £4 billion in 2006 to £3.5 billion by 2011

Media, Internet 9 November 2006
Classified advertising in the UK

This presentation expands on our report on Classified Advertising in Print and Online [2006-58], by examining the online classified market segments of recruitment, property and automotive, and their likely development to 2011. We anticipate the value of the UK classifieds market could be worth about £5.5 billion in 2011, compared to about £4.5 billion in 2006. We however expect exponential growth in online classified ad volumes, placing pressure on prices of all classifieds. Although disruptive effects on the classified supply chain are anticipated (e.g. estate agents, car dealerships), we believe these will be harder to break than new entrants might believe

Media, Internet 20 June 2007
Clear Channel – designs on global radio?

Encouraged by the way that Google has come to dominate the global market for online search advertising, Clear Channel and its rival CBS Radio are now eyeing the potential to dominate the global market for online radio advertising, and fend off Google. In July 2008, Clear Channel announced its plans to dominate the ‘internet radio’ market, by launching a ‘portal’ offering a vast array of radio programming, along with a new business unit to sell online advertising inventory. Although Clear Channel’s targets initially are US advertisers and US internet users, the company will likely target the UK market when it eventually decides to roll out its business model for online radio to the rest of the world. As a result, within the next decade, the UK commercial radio sector could face an additional source of competition from overseas media companies offering radio content delivered via the internet

  • Google
Media, Internet, Music and Radio 1 September 2008
Clear horizon for Sky Deutschland

Sky Deutschland is reaping the benefits of its re-launch using BSkyB’s model, with an improving content offering and quality of user experience, plus a favourable environment for household consumption in Germany.

2012 results came in very close to our forecasts and we predict that Sky Deutschland will break even at EBITDA level in 2013 and turn cash flow positive in 2015.

The competitive context is benign and the horizon is clear until the next Bundesliga auction in 2016. But, in the meantime, cable, IPTV, FTA and OTT players are committed to widening their pay offers, which may put pressure on Sky’s subscriber growth and content costs.

  • Sky Deutschland
  • News Corp
Fixed Line, Telecoms, TV, Media 21 March 2013
Climate change: M&S goes for Plan A

Marks & Spencer’s plan to make itself the world’s most 'sustainable' retailer is an extremely ambitious proposal to make the company carbon neutral, reduce its own landfill waste to zero, and change its supply chain to improve its position as an ethical retailer

Media 18 January 2007
Closing in on 50-50 the right way - ITV FY 2015 results

ITV has delivered double-digit growth in adjusted EBITA for the sixth year running, marked by big increases in both TV NAR (Net Advertising Revenue) and non-TV NAR revenues, which now make up nearly 50% of the total

The outlook for 2016 is promising. We expect continuing real growth in ITV family NAR in line with the market average, and further substantial increases in both Online, Pay & Interactive and ITV Studios

The big question is how ITV can sustain all it has achieved with the international expansion of ITV Studios and use its growing scale to support growth in its Online, Pay & Interactive revenues abroad as well as in the UK

  • ITV
Media, TV, UK Media 7 March 2016
CMA issues provisional findings in Fox-Sky

The Competition and Markets Authority (CMA) has provisionally found that Fox’s acquisition of Sky is against the public interest on media plurality grounds, although it could proceed with an appropriate remedy

The CMA found the merger would give the Murdoch Family Trust (MFT) and family members “too much influence over public opinion and the political agenda”

The CMA now enters the challenging remedies phase. Fox could offer an Editorial Board for Sky News pending finalisation of Disney-Fox (by 2019). Third parties seem likely to continue to seek to prohibit the merger

  • 21st Century Fox
  • News UK
  • Sky
21CF Sky specific emails, Non-UK Media, Non-UK Telecoms, Media, Technology, Telecoms, TV, UK Media 30 January 2018
Comcast/Disney: The Strategy Examined

Although the prospect of a successful Comcast bid for Disney has receded almost completely, we expect it to come back. The strategic imperative for Comcast to integrate with a leading content producer remains acute. It confronts a reinvigorated and very aggressive competitor in DirecTV. Satellite is rapidly draining high ARPU pay-TV subscribers from the cable companies. Increased expenditure on programming, services and marketing are the only responses possible to combat the erosion.

Media 5 March 2004
Cometh the hour for the commercial PSBs

The first half of 2017 has seen the announced departure of three CEOs from the commercial PSBs within the space of less than two months: David Abraham of Channel 4 (14th March), Rob Woodward of STV (25th April) and lastly Adam Crozier of ITV (3rd May)

Responding to the challenges of digital switchover and the advertising recession of 2008/09, as well as their own specific company issues, one of the first tasks for all three CEOs has been to raise staff morale

The last seven to ten years may have been taxing at times. The next seven to ten promise to be no easier, and may yet be harder, as the successor CEOs chart their way through the continuing transformation of the UK digital landscape

  • Channel 4
  • ITV
Media, TV 28 June 2017

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