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Enders Analysis provides a subscription research service covering the media, entertainment, mobile and fixed telecommunications industries in Europe, with a special focus on new technologies and media.
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Cash now, cash hits later: Vodafone M&A
18 October 2022Vodafone is in the midst of a flurry of M&A, likely driven by its share price, which is at a 30-year-low, and stubbornly high leverage as an economic crisis looms.
While the mooted Vodafone/Three merger has the potential to add meaningful shareholder value, the German and Vantage deals are designed to ease Vodafone’s ongoing leverage issue—with debt relief up front paid for with future EBITDA.
Getting leverage under control will be helpful, but the focus should continue to be Vodafone’s operational performance, particularly in Germany, and its ability to deliver EBITDA promises in challenging circumstances.
Karen Egan was quoted in the Financial Times on "European telecoms groups await M&A green light"
18 October 2022Karen Egan, an analyst at Enders Analysis, said that the ECJ ruling next year is “going to be absolutely critical for European mergers”, adding that regulators’ view on the Orange-MasMovil deal is “more uncertain than the companies are portraying to the market."
She added “Whether you’ve got three players desperately trying to fill their networks, or four, isn’t that different in terms of competitive intensity."
Gill said "BBC Studios is certainly a very powerful engine that brings money back to the parent company, but it is not a cash cow. Even if its growth has been constant, in production, the profit margins are quite low."
Francois Godard was quoted in Les Echos on 'Top Gun: Maverick' producer valued at $4 billion
17 October 2022Francois said “Private equity funds, like KKR, seem to have discovered in recent years the value of intellectual property and the relatively predictable income it generates."
The quality of its editorial policy has a lot to do with it. “They have a great flair for investing in blockbuster films. The Mission impossible, for example, will still make money in fifteen years”, notes François Godard. The tremendous success of "Top Gun: Maverick", which at the end of August had accumulated more than 1.4 billion dollars in worldwide box office receipts, provides a recent illustration of this.
With major studios arguably over-indexed on SVOD, the stickier experiences of interactive entertainment and the metaverse will eventually form a critical pillar of studio D2C strategy, boosting subscription services and tying in closely with consumer products and theme parks.
Disney’s appointment of a Chief Metaverse Officer is good first step, demonstrating a strategic interest in the space. But other major studios remain cautious and distracted, with limited capability beyond licensing to engage in the metaverse for the next 24 months and possibly longer.
Meta will need to provide a strong guiding hand creatively and technically to ensure its new partnership with NBCUniversal is a success, and to evangelise the metaverse and its revenue model across the Hollywood studio content space.
Douglas McCabe was quoted in The Times on "Young people are switching out of traditional news. We wanted to do something about it"
13 October 2022Douglas said “Young people worry about a consensus in the news hierarchy and the combative tone of news media. The News Movement cuts through these issues. As a result of the rapid rise in subscriptions, news and media have become investible again. It is great to see a cycle of innovation gathering pace.”
Douglas said “A return to profits is a performance most media would take. The core business, effectively matching 2019 levels, has shifted to more sustainable online subscriptions with some healthy diversification growth on top."
“The FT is also better protected against economic headwinds than consumer media.”