UK DTV Platform Growth
The UK continues to be the largest and fastest growing national digital TV (DTV) market in Europe. We now expect 75% of UK TV homes to be equipped with digital reception by the end of 2006, rising to over 85% by the commencement of digital switchover in autumn 2008.
We have argued that mobile operators offering free broadband makes little sense from an economic perspective, and it now appears that it has little draw for consumers as well (which is lucky given its very high cost)
A large number of mobile operators are launching ‘convergence’ offers in Europe (including Vodafone across all its major subsidiaries), and this poor result in the UK suggests that this will prove a needless distraction for them
|Media||15 August 2006|
UK DTV platform growth: 2005-20150
With the completion of digital switchover still on track for mid 2012, stabilisation of the main digital broadcast platforms is expected, with roughly equal numbers of subscription pay-TV and free TV homes, though with marked differences between the platforms in terms of demographic composition and the proportion of pay-TV customers
Further marked differences exist between the satellite, cable and terrestrial platforms with regard to PVR adoption, notably higher in pay-TV households where distribution can benefit from box subsidies and greater product consistency. National PVR penetration of TV homes is expected to grow from slightly below 50% in 2010 to over 70% in 2015
As DSO nears completion, the stage is set for broadband connectivity. Although household penetration of internet-enabled TV devices is expected to exceed 50% by 2015, the emergence of hybrid broadcast and broadband services is expected to proceed much more slowly, limited by a number of factors – not least the ability of service providers to monetise their non-linear on demand offerings
|Technology, Internet, TV, Media||17 December 2010|
UK economic outlook: stagnation
Post financial crisis, the dynamics of the UK economy have been reset, as consumers shun credit-fuelled expenditure – the latest GDP data for Q2 2012, confirming the ‘technical’ recession, reinforces our view of an economy moving sideways rather than recovering.
Household consumption in real terms has been in moderate decline since Q4 2010, on real disposable income declines, in turn due to a combination of weak nominal earnings growth due to flat productivity growth, and high inflation.
Although inflation has decelerated markedly in 2012, we continue to expect household consumption to exhibit little meaningful growth for the foreseeable future, which in turn can only be bad news for media and telecoms companies.
|Telecoms, Media||26 July 2012|
UK economy: same diagnosis, new prognosis
Both the Bank of England and the Office for Budget Responsibility have in the last month severely downgraded their view of the long-term underlying growth potential of the UK economy, reflecting a new forecasting consensus that the UK’s disastrous productivity performance post-crisis is not a blip but indicative of a disappointing new normal
The fundamentals of the UK economy, however, remain little altered from earlier this year – investment is weak, household finances are emaciated, people are compensating for weak productivity by simply working more and harder, and consumption growth is approaching its limits
The outlook for the next five years is bleak – earnings are in store for the longest squeeze in living memory and inequality is set to explode. Factoring in the risk of recession and/or of a disorderly Brexit transition, the BoE/OBR’s projections could yet seem over-optimistic
|Brexit, Media, Public Policy||18 December 2017|
UK fixed telecoms market: broadband and telephony trends to Q1 2012
In this report we show our analysis of trends in UK broadband and telephony to March 2012, based on the published results of the major service providers.
Highlights for the March quarter include broadband subscriptions exceeding 21 million, a sudden uptick in broadband market net additions and local loop unbundling accounting for a record 40% of broadband subscriptions. The proportion of unbundled lines that are fully unbundled exceeded two thirds for the first time.
This quarter we also include a look at pricing, including prices for high speed broadband that show how BT Retail is using high speed broadband to reduce the price advantage of its competitors.
|Telecoms, Fixed Line||13 June 2012|
UK fixed telecoms market: broadband and telephony trends to Q4 2011
In this presentation we show our analysis of trends in UK broadband and telephony to December 2011, based on the published results of the major service providers.
Highlights for the December quarter include a return to the lower rate of broadband market growth seen prior to mid-2010, 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 Openreach’s wholesale FTTP On Demand, planned for launch in 2013.
Following announcements by Virgin Media to double the speeds used by most cable customers, and by BSkyB to launch high speed broadband offer in April based on Openreach’s wholesale VDSL product, by 2016 we now expect about half of UK residential broadband subscribers to be on high speed broadband, i.e. xDSL or GPON at 30 Mbit/s plus, and DOCSIS at 20 Mbit/s plus
|Fixed Line, Telecoms, Internet, Media||27 February 2012|
UK Fixed Telephony Market Trends
Over the four years to 2008, fixed telephony market revenue has fallen by about 17% (£1.9 billion). But the picture is complex
The total number of fixed access lines has fallen by only 4% since 2004, but losses have been predominantly of business lines, due to a combination of inter-related factors involving a shift from ISDN2 to broadband, fixed call substitution and increased home working
We estimate that roughly half of the decline in total market revenue since 2004 has been due to substitution of dial-up internet access by broadband, the rest being accounted for by the substitution of regular call minutes by email and other forms of text communication, as well as by mobile, and price cuts
|Telecoms, Fixed Line||10 October 2009|
UK General Election online - news and advertising
In contrast to print coverage, most shared news and opinion content on social media was decidedly pro-Labour this election season, with fake news relatively non-existent compared to the US election in November
Facebook’s role in news distribution has steadily grown and now rivals Google’s, but only a half of the UK’s electorate are active users – for the platform to become decisive in political news would require much stronger turnout among young voters
Facebook was the chief digital ad platform for both main parties, with Conservatives targeting Labour seats, Labour defending them and both adopting a negative tone
|Internet, Media, Mobile, Technology, TV, UK Media||7 June 2017|
UK Handset Survey
We have recently completed our December survey of UK mobile users, which shows increased purchase intentions for handsets in general and camera phones in particular. We summarise the results in this note, which are good news for handset manufacturers, but more mixed for the operators.
|Telecoms, Mobile||19 December 2002|
UK home video: digital switchover
The British Video Association has released full year figures for 2013 for the UK home video market, which reveal that growth in digital video, especially in over-the-top subscription services e.g. Netflix, offset the fall in spend on physical media last year, reversing the previous downward trend
The bad news is that DVD’s decline is set to quicken, as the number of households with stand-alone players has begun to fall, though there should be some respite this year from sales of huge box office hits such as Disney's Frozen and Warner Bros.' Gravity
Ultimately, we see rising penetration of high speed broadband and connected devices including the TV set as a net positive, as more people have more ways to spend money on video, but the shift from purchase to rental and subscription options will mitigate the benefits
|Internet, TV, Media||1 July 2014|
UK Internet Advertising
The internet is the UK’s fastest growing advertising medium, with spend rising 41% to £2.02 billion in 2006, and a further 30% rise expected for 2007. Three drivers underpin this growth: more intense use of the internet as broadband connections become standard, very strong growth in e-commerce, which is driving up paid-for search, and improving yields through rich-media formats. These factors will continue to propel growth of internet ad spend in the near future
|Media, Internet, Telecoms, Fixed Line||9 April 2007|
UK internet advertising forecasts for 2012/2013
Recent news flow and feedback from media buyers indicates that growth in UK internet advertising is slowing due to the ongoing weakness in the economy
Paid search, buttressed by its link to e-commerce and measurable ROI, is suffering less than internet display, with growth in spend on social media slowing and price deflation especially for non-premium inventory
Online classifieds are also being hit by the economic woe, resulting in some sectors growing more slowly and non-advertising communications taking a larger share of spend; the secular shift to the internet continues
|Internet, Media||20 June 2012|
UK internet advertising powers ahead
According to IABUK/PwC, internet advertising grew 14.4% like-for-like in 2011 to £4.8 billion, overtaking press to become the single largest advertising medium
Search was again the main growth driver, surging 17.5% to £2.7 billion last year, while display rose 13.4% and classifieds increased just 5.2% on the weak economy
We now forecast internet advertising will increase 14% in 2012 and 12% in 2013, taking spend to £6.1 billion or 36% of UK advertising, up from 30% in 2011
|Media, Internet, Telecoms, Mobile||9 April 2012|
UK internet advertising strong in H1 2011
Internet advertising rose strongly in H1 2011, according to the latest IABUK/PwC figures, increasing 13.5% YoY compared to 1% growth in spend on other media
Search grew 12.6% YoY while display was up 18.6%, in line with our forecasts, but classifieds slowed, up just 3% YoY, with recruitment and other sectors stagnating
Our internet advertising forecasts for 2011 and 2012 remain unchanged at 12% and 13% respectively
|Internet, Media||4 October 2011|
UK internet advertising: 5 year forecasts
We forecast UK online advertising to grow by 8% CAGR to £5.1 billion by 2014, representing approx. 33% of total advertising spend, overtaking press
Search is the main growth engine, which we predict will reach £3.1 billion in 2014, due to its appeal and value to advertisers as a sales and lead generation tool
Growth in spend on social media and video networks will push online display to just over £1 billion by 2014; whilst classifieds will grow to £840 million
|Media, Internet||29 September 2010|
UK internet advertising: Facebook to the fore
UK internet ad spend rose 13% YoY in 2010 to £4.1 billion; stripping out newly included formats such as mobile and Google hedging gains indicates actual growth was 15%
Growth in display, increasingly powered by Facebook and Google, continued to outpace that of search, with early signs that some brand advertising is shifting online
We have revised our growth forecast for 2011 to 10%, taking spend including mobile to £4,400 million, pushing the internet’s share of total advertising to 27%
|Internet, Media||7 April 2011|
UK internet advertising: raising 2010 forecasts
Recent news flow – including Google UK’s Q4 2009 results and reports of facebook’s rapid revenue growth – points to a better than expected recovery in internet advertising. On a like-for-like basis, we estimate that online ad spend grew 2.2% last year to £3,425 million or 23.5% share of total advertising
We have raised our 2010 UK forecasts and now predict that Google’s UK gross revenue will grow 12.5% YoY, helping to drive online advertising spend up 7.6% to £3,685 million (excluding sites currently not reported by IABUK/PwC)
The economy remains an issue, with the potential impact of tax rises and cuts in Government spending in H2 threatening the already anaemic recovery. In our view, the balance of risk is still on the downside
|Media, Internet||5 February 2010|
UK internet advertising: spend flat, share up
Recession has hit internet advertising, with spend down 1% YoY in H1 2009, but the collapse in advertising on traditional media helped push online to 23% share, up 4 percentage points versus H1 2008
Based on IABUK/PwC data, we estimate that spending on search rose 2% YoY in H1, whilst display was down 5% and classified fell by 4%, the latter supported by unexpected growth in non-recruitment listings
We have adjusted our forecast for online advertising up slightly to flat for the year, but whilst the internet has now overtaken TV in absolute terms, TV remains very much the king of display
|Media, Internet||4 October 2009|
UK internet device and consumption forecasts to 2020
The boom in mobile device sales accelerated in 2013, with more than four times as many smartphones and tablets as PCs shipped in the UK: smartphones accounted for three quarters of mobile phone sales, and shipments of tablets surpassed PC sales, which fell sharply
By 2020, we forecast that smartphone penetration will rise from two thirds of the population to over 80%, and the number of tablet users will exceed 60%, outstripping the PC internet audience, which we expect to shrink. We now predict that the majority of internet usage will go to mobile devices this year and three quarters by 2020
Mobile is well on its way to becoming the predominant access platform in the UK, as in the US, and most, if not all, future growth in commercial internet revenues will be driven by mobile devices
|Fixed Line, Mobile, Telecoms, Technology, Internet, Media||21 April 2014|
UK internet device and consumption forecasts to 2020
Reports of the death of the PC have been greatly exaggerated, but rapid adoption of mobile devices is changing how, when, where and why consumers access the internet.
Over the next few years, we forecast that PC user growth will be limited to population growth, smartphone penetration will rise from two thirds currently to over 80% by 2020, and tablet users will converge to the same level as the PC audience.
In addition, we project that overall internet consumption will nearly double by 2020, with PC-based usage declining before levelling out, and smartphone and tablet use increasing threefold.
Of the traditional media sectors, we expect print media to be the most negatively affected by the rise of the mobile internet, with less impact on radio and TV viewing and advertising likely to be relatively resilient.
|Mobile, Telecoms, Technology, Internet, Media||6 August 2013|