Sky

2010 off to a good start: Sky fiscal Q1 2010 results

Latest fiscal Q1 2010 results show continuation of the strong subscriber and revenue growth trends, but as Sky forges ahead of its rival pay-TV operators so attention is turning to competition issues

It is still unclear whether Ofcom will succeed in introducing a wholesale ‘must offer’ remedy with regulated pricing for Sky’s premium subscription films and sports channels; a proposal that Sky vehemently contests but, if put into place during 2010, this could have a significant influence over the longer term structure of the UK pay-TV market

The future progress of Ofcom's pay-TV review

Three years into its pay-TV investigation, we expect Ofcom to impose a wholesale must-offer obligation with regulated prices on the Sky premium films and sports channels in its final statement scheduled for Q1 2010

The WMO could take effect by the middle of 2010. It appears unlikely that Sky will be granted a stay of implementation whilst its appeals against the lawfulness and substance of the WMO remedy are being heard

Court of Appeal verdict on Sky stake in ITV

The Court of Appeal’s (CA) dismissal of Sky’s second attempt to overturn the Competition Commission’s (CC) decision that it must reduce its 17.9% shareholding in ITV to below 7.5% makes it increasingly probable that Sky will comply with the CC ruling at some point during 2010/2011

Although the CA’s dismissal of Sky’s appeal has always seemed the likely, even if never certain, outcome, the extra time consumed has so far benefited Sky greatly as the ITV share price has recovered from a low of below 20p in March 2009 to around 60p in January 2010

Sky fiscal H1 2010 results: high on HD, 3D to come

Sky fiscal H1 2010 results show continued resilience in the face of weak economic conditions, delivering strong net subscriber growth, a big lift in ARPU, and a record lift in HD subscriptions, almost 200,000 up on any previous quarter and only just short of the half a million mark

Sky+ HD is now manifestly the centre point of a three-pronged operational strategy that focuses on driving customer growth, selling more products into the customer base and seeking efficiencies in fixed costs

Can Sky deliver a German pay-TV turnaround?

The News Corp management has given Sky Deutschland a full and costly revamp in 2009, leading to a steep year on year increase in negative EBITDA of around €200 million

Underlying trends of improvement in net subscriber additions, ARPU growth and churn reduction, assisted by its HD offer, suggest that Sky management will get close to, if not actually meet, its 2011 breakeven target

However, there are significant downside risks in the historically tough German pay-TV market, and robust profitable growth beyond 2012 presents a real challenge

Winners and losers of the May 2010 general election

The outlook for ad-supported UK media businesses is brighter in the short term than in the medium term, irrespective of who wins the election, since fiscal tightening is inevitable early in the next parliament
We expect the Conservatives, should they win, to favour commercial media (Sky, ITV) over the BBC in general and in particular in the upcoming negotiations on the licence fee settlement post 2013

Election winners and losers: revisited

A hung Parliament now appears the most likely outcome of the UK general election on 6 May, giving the Liberal Democrats influence, in terms of votes and seats, over the next government

Because the Lib Dems are ideologically closer to Labour than to the Conservatives, we anticipate their influence will favour the policy and regulatory status quo in media and telecommunications in relation to the proposals made by the Conservatives

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