Estimates of the cost of building 3G networks in large European countries have tended to cluster around $5 billion per operator. This, in addition to the embarrassing large licence fees paid to governments, is acting as a drag on stock market performance.
This figure is exactly what we would have predicted based on our modelling of 3G costs contained in our June report. Sweden is nearly twice the size of the UK, and the regulator's coverage requirements are probably the strictest in Europe - in theory the whole of population has to be covered. But costs are reduced because Europolitan will share its network with the Hutchison 3G venture in all areas of the country outside the four biggest cities.
|Telecoms, Mobile||18 June 2001|
3G Infrastructure Sharing
The UK telecoms regulator, Oftel, has just (1st May) produced a briefing note that seems to encourage the idea of infrastructure sharing of third generation mobile networks. It defines 'infrastructure sharing' as including both physical sharing of sites, and also the sharing of capacity. The example Oftel gives is interesting. It says that two operators could divide up the country, one, say, building a network in Manchester, the other in Leeds. They could then allow free 'roaming' between the cities.
Our primary purpose is to provide revenue forecasts for the next three years. Our central forecast sees Retail revenues falling at percentage rates in the low single digits. Wholesale revenues are driven by different forces and will rise rapidly next year, and at a slower rate thereafter. The rise in Wholesale revenues will not be enough to stop a fall in overall income.
|Telecoms, Mobile||18 May 2001|
4G in the UK : Advantage EE
A number of developments over the summer have, at least in theory, made the UK 4G mobile spectrum outlook a lot clearer: in July Ofcom issued its final policy statement regarding the 800MHz and 2.6GHz ‘4G’ auctions, in August it decided to allow Everything Everywhere (EE) to ‘refarm’ its 1800MHz spectrum for 4G use, and EE announced that it had sold 15MHz of its 1800MHz spectrum to H3G
The main short term implication is that EE will have clear short term advantage of being the only operator offering 4G (LTE) services for about 12 months from (roughly) the end of September 2012 to (roughly) the end of September 2013
The main uncertainty is legal action; O2 and/or Vodafone may appeal Ofcom’s decision to allow EE to refarm its 1800MHz spectrum, which would trigger EE to appeal the 4G spectrum auction rules, and give 4G in the UK an unhelpful delay
|Mobile, Telecoms||20 September 2012|
A busy week in UK broadband
BT’s launch of ‘Total Broadband’ represents a timely improvement in the value proposition for BT’s residential broadband customers but its impact will depend crucially on the success of BT Vision and other related services yet to be launched
|Telecoms||21 June 2006|
A future for tablet publishing? La Presse case study
Montreal’s La Presse follows a unique tablet-focussed, free access, fast track digital strategy. It said adieu to weekday print editions in December. An in-house developed app – La Presse+ – sets new benchmarks: advertising friendly, easy to navigate, and engaging
High ABC1 market share in French speaking Quebec helped build digital scale rapidly. La Presse+ has broken circulation records thanks to an influx of younger readers. Advertising is sold at a premium to print and the newsroom has expanded
In a tougher market The Toronto Star launched the app last September with positive initial results. The Star Touch approach is additive rather than substitutional to print and may be more relevant to newspapers elsewhere. Slower tablet penetration growth is no big worry as phone screen sizes increase and PCs converge towards tablets
|Media||24 February 2016|
A new Fox bid for Sky: when, not if
News Corp’s original bid for full ownership of BSkyB was withdrawn because of the phone hacking scandal. It was never blocked by regulators. Had it not been for the scandal, the bid would almost certainly have been approved.
With the phone hacking scandal fallout largely over and the election of a friendly government, the climate is now much more favourable to a renewed bid. With undertakings, we believe it would be approved by regulators.
The increasingly global scale of TV and film distribution means the commercial case for the bid is, if anything, stronger now than in 2010. The questions are simply whether the right price can be agreed, and how high up it is on James Murdoch’s list of priorities.
|Media, Technology, Telecoms, TV, US Financials||1 July 2015|
A room with a VUI: voice and Amazon Alexa
Amazon’s smart Echo speakers are coming to Europe, powered by a voice-controlled intelligent assistant, Alexa. Echo is thought to have found surprise success in the US
Alexa is best thought of as the most complete Voice User Interface (VUI) on the market. We expect VUIs to supplant graphical user interfaces for a variety of use-cases, in the home, on the move and in the car. Competition in this area is increasing
Alexa is being positioned as the Android for voice, moving beyond devices made by Amazon in an attempt to jumpstart adoption, and with developers building services on top of Alexa’s core voice platform
|Non-UK Media, Internet, Media, Mobile, Technology||29 September 2016|
A third digital ad force: Verizon and Yahoo
To diversify revenue in a saturated US mobile market, telecoms giant Verizon Communications followed an earlier merger with AOL by acquiring Yahoo for $4.8 billion
The combined online ad platforms are likely to become the most viable contender for third place in the US, after Google and Facebook
Verizon’s mobile subscriber data could narrow the market leaders’ targeting and measurement advantage, but regulation and customer reception pose risks
|Non-UK Media, Non-UK Telecoms, Internet, Media, Mobile, Non UK Media, Telecoms||15 August 2016|
A U-turn at the Competition Commission?
The CC seems to be preparing to reverse its provisional conclusion that Sky’s hold over premium movies is damaging competition
|Media, TV||14 March 2012|
About finding the right balance - Channel 4 annual report
Channel 4 enjoyed a bumper year in 2012 with regard to delivering its public service remit, epitomised by the London Paralympics
Public service successes notwithstanding, the continuing decline in main Channel 4 audience share post digital switchover is not being fully compensated commercially by large gains across the rest of the Channel 4 portfolio
Overall, we expect group revenues to remain quite stable in 2013 and 2014, but current record levels of investment in programme content origination have yet to bear fruit in terms of strong returning series
|Media, TV||29 May 2013|
Activision: the new King of the games industry
Activision’s announcement of its intention to buy King, the maker of Candy Crush, for $5.9 billion, is a major strategic play but positions the company well as it seeks to broaden its exposure to the growing mobile games market
Activision has answered the “build or buy” question by looking to King to strengthen its capabilities in key areas: specifically mobile development, online gameplay, customer acquisition and retention analytics, as well expanding its range of revenue streams
Other mobile and online game developers are now under renewed focus as possible acquisition targets by major developers. Enders expects more acquisitions in this space in the near term
|Media, Technology||12 November 2015|
Addressable TV has more to deliver, while online video posts record highs
The market for addressable TV looks constrained despite its benefits, with Sky AdSmart taking less than 2% of overall TV ad revenues. Meanwhile, online video revenues for Google, Facebook and others have surged dramatically
Agencies are seemingly enraptured by online video – a highly profitable medium to buy – despite concerns about a lack of effectiveness, safety and transparency
For broadcasters to compete, better radical collaborative action is needed, including industry-wide adoption of AdSmart, and overhauling the trading agreements which hinder its take-up
|Media, Telecoms||14 March 2018|
Advertising after the turning point: when offline is the exception
Online advertising became the majority of all UK ad spend last year, in step with China but ahead of all other major markets.
Direct response has further increased its share to 54% of UK ad spend, fuelled by the self-serve platforms of Google, Facebook and Amazon, while content media nets just 11% of the online advertising pot.
We estimate that all online-delivered channels - including "pure play" online properties, broadcaster VOD, digital out-of-home and online radio - could account for well over 60% of UK ad spend by 2020, but only with improved commitment to industry governance.
|Internet, Media, Mobile, Non UK Media, Technology, TV, UK Media||14 June 2018|
Advertising ups and downs in 2017
Brexit has not noticeably depressed advertising spend in 2016, as consumer spend is buoyant, fueled by borrowing and lower savings. Yet, businesses are being cautious as uncertainty weighs on the future rules of trade with the EU
We forecast total advertising spend to rise by 0.6% at constant prices in 2017, almost entirely due to digital growth, which is expanding the total advertising market. Its share has soared from 1% in 2000 and looks likely to hit 50% in 2017
Up to now digital growth has always been at the expense of print and not television, but this could just be changing as mobile increasingly holds centre stage for the consumer
|Brexit, Media||12 December 2016|
Advertising: this year, next year
We forecast UK display adspend to grow by 3.1% in 2018 (<1% in nominal terms), with TV roughly steady, newspaper decline slowing and digital growth slowing a little
Households are facing an income squeeze and the ability of debt and credit to carry them over is reaching its sensible limit. Brexit-related uncertainties remain the single strongest drag on business investment, dampening ad spend
TV spend is the £5bn question. While live viewing continues to decline, TV delivers against different marketing objectives from precisely targeted online inventory, and rapid broadcaster VOD growth will help hold TV spend steady
|Media, Technology, Telecoms||14 February 2018|
Al Jazeera needs Canal+
Qatar’s Al Jazeera will launch its French pay-TV channel by this summer, showing weekly Ligue 1 and Champions League games, but it has yet to disclose a business plan and distribution deals
The new channel is a complement to Canal+, which broadcasts the most attractive games. Al Jazeera would need to obtain distribution on the Canal+ platform
Even if such a deal were to be struck, Al Jazeera would struggle to break even
|TV, Media||18 January 2012|
All about multi-products: Sky fiscal Q3 2010 results
Sky Q3 2010 adjusted revenues showed strong year-on-year growth of around ten percent in the year to date (10.7%), and in the third quarter (11.1%), marked by strong product sales into its existing subscriber base, especially in HD, but also solid progress in broadband, telephony and line rental
The rise in revenues was more than matched by a rise in costs (up 11.7% in the first nine months); however, this was largely accounted for by a one-off rise in programming costs in the wake of Setanta’s departure in June 2009 and upfront HD investment and direct network costs associated with the strong growth in product take-up
Once the HD and direct network investment costs driving product growth have washed through, Sky appears well on track to deliver operating margin growth into the upper twenties for its TV business and into the high single digits for its telecoms business; which we expect to experience little direct material impact in the next five years from the implementation of the Ofcom wholesale must-offer remedy
|Fixed Line, Telecoms, TV, Media||4 May 2010|
Alleged 25% Drop in ITV Viewing
The flow of news about ITV is going from bad to worse. But we think that the market may have misunderstood the real story behind last week's bombshell that ITV viewing has fallen by 25% in a year. This figure could have been predicted from existing data.
|Media||15 January 2002|
Altice in crisis as formulaic model flounders in France
The telecoms group has suffered a dramatic stock market correction following its Q3 results, as investors woke up to the continuous decline of its main unit, France’s SFR – leading its CEO to resign. Closure of a tax loophole will further erode SFR’s revenues by up to 4% in 2018
Despite being France’s largest fibre network, SFR’s broadband market share dropped 4ppts over three years. Notwithstanding grandstands on ‘convergence’ and expensive rights acquisitions, it is losing pay-TV subscribers – it looks unlikely to challenge Vivendi’s Canal+ in next year’s Ligue 1 auction
The mobile performance is notably better with the subscriber count stabilised and ARPU rising. Besides sustaining network deployments, to turn around SFR Altice needs to abandon short term fixes, invest in its workforce and customer service, and differentiate through valuable innovation – in other words the opposite of the model followed so far
|Non-UK Media, Non-UK Telecoms, Media, Telecoms||16 November 2017|
Amazon Channels: bite-sized pay-TV for the whole family
After a US debut, Amazon’s marketplace of SVOD services arrives in the UK and Germany, but without the major draws of HBO and Showtime
Unbundling SVOD for premium content strengthens Amazon’s position in the fast-developing connected TV landscape, where Prime Video is taking on Netflix, NOW TV and YouTube
For niche content providers, Amazon Channels provides a new, low-friction route to go direct-to-consumer with a mix of live and on-demand premium content alongside existing distribution strategies
|Media, Technology, TV||24 May 2017|