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Rigorous Fearless Independent

This report is free to access.

Female-led and equally-led employers numbered 550,000 in the UK in 2019, a 40% share of 1.4 million businesses. These are often sub-scale businesses requiring financial and digital skills to scale up.

Female-led businesses cluster in education, health, food and accommodation, the latter being highly exposed to the pandemic. The more protected and dynamic ICT sector has low female engagement, which higher levels of study of STEM subjects will remedy.

Consumers are embracing digital to live and work through the pandemic. Enterprises that are digital and digitally-enabled will survive and flourish, supported by initiatives from Google, Facebook and others.

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Claire said “The last auction was post-peak, the takings were down and we expect that to continue. Sky and BT overpaid for rights in the past and BT has suffered a decline in its value. Now the UK sports broadcasters are trying to think about reducing their rights costs."

She added “Auctions are emotional affairs and in the past, BT has always blinked and written a  cheque. But they are now in a stronger position and both companies can afford to offer less. The next auction could lead to a five-ten per cent decline in the rights values in the UK.” 

Claire said “The counterfactual is to think what would happen to these businesses without live sports rights. They would simply implode. Survival is the driver that hits the elbow when a network is writing a check for something 50% to 100% more expensive than they paid last year. Without MLB, TBS would become a general entertainment channel, and WarnerMedia would find it almost impossible to sustain carriage fees [not just for TBS, but the entirety of their portfolio]. Long-term carriage of the sport on the network also makes baseball programming sellable to advertisers in a way that most of the material on TBS does not. Turner had to [renew the package], at basically any price, in order to [keep TBS] in business." 

She added "All of the [traditional broadcast players] can weather huge uncertainties, huge cash-flow holes by issuing debt."

With the European Commission’s decision to block the H3G/O2 merger annulled and with new H3G management sounding a very pro-consolidation tone, the prospect of mobile operators going from four to three in the UK seems to be back on the cards.

Both H3G/Vodafone and H3G/O2/Virgin Media combinations seem possible although each has its own complexity—existing network sharing arrangements being one of them.

With 5G delays and mounting costs following the decision to ban Huawei, consolidation is increasingly feeling like the most viable option for H3G whose returns are already too low and falling rapidly.

Julian said “That’s a huge sum of money and that shows the scale and amount of money that can be sunk into a TV news channel. Even at the best of times “news isn’t known to be a commercially attractive genre. Any TV station is typically loss-making.”

He added  “It is especially difficult this year because of how Covid has devastated the advertising market, not just in the UK but around the world. We have seen big slumps across the second quarter of the year.”

With a lack of live sport, the lockdown weighed on incumbent pay-TV platforms’ subscriptions. SVOD providers leveraged their cheap positioning—Netflix and Amazon Prime Video now rank above other subscription services in Europe, and Disney+ had a successful launch.

Incumbents—Sky, Canal+, Movistar+—all pursue a twin-track strategy. They are positioning themselves as gatekeepers thanks to service bundles, while redirecting resources away from sports towards original series.

European productions are increasingly garnering audiences outside of their home markets, regardless of the production language. Netflix is a major conduit for European exports, due to personalisation of the interface and high-quality dubbing.

Claire said “Chris quickly realised the BBC wasn’t some leftist conspiracy and became a chair that improved and assisted, rather than destroyed."

“Charles Moore, however, has a radically traditionalist view of the country that deplores issues like feminism, which the PSBs are trying to portray in a sympathetic way. He will find this fundamentally affronting to his sensibilities.”

Sanchit said "It does look gimmicky on the surface, but this could be Amazon remaining one step ahead of the competition. No one has managed to nail palm scanning so far, so Amazon, if it can do so successfully, is first in a very short line.

He added, "If palm payments are feasible, this is a huge step toward that increasingly contactless reality – and Amazon will be the number one partner for businesses. Potential applications of the tech are limitless."