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European mobile service revenue growth improved to -7.6% in Q1 2014 from -9.0% in the previous quarter, but most of the improvement came from a drop in the regulated MTR cut impact, with underlying growth only improving 0.2ppts

This is in spite of continued improvements in GDP growth and the highest level of consumer confidence in six years, confirming that the often-blamed economic conditions actually have been having little impact on the market, with competitive intensity the real cause

For this very reason, the approval by the EC of in-market mergers in Germany and Ireland has been warmly welcomed by the industry and investors. Our view is that market repair is dependent on a change of attitude of the incumbents towards long term investment and away from chasing short term subscriber share via price discounting; consolidation may well help with this, but it is neither necessary nor sufficient

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

After a three-week long “messy and opaque” high drama auction Sky retained its broadcast rights for all Italy’s Serie A games for 2015-18 with a negligible 1% price increase.

Its rival Mediaset managed to keep hold of the top fixtures, but its coverage shrinks by 18% whilst paying 35% more. A deal earlier this year for the Champions’ League rights will add considerably to Mediaset’s total costs.

In the stagnating Italian economy, Sky may manage a return to more comfortable profitability. Mediaset’s pay-TV business model looks much more challenging, even if a new investor were to be lured in.

UK mobile service revenue growth remained relatively healthy at -1.6% in Q1 2014, despite the absence of some favourable one-off factors in the previous quarter, consolidating the improvements seen in 2013. Underlying growth improved a touch to 0.3%, and given that the regulatory impact will drop out next quarter, reported revenue growth may well turn positive in Q2

Service revenue growth among the ‘big three’ has re-converged to around -3% to -4%, with Vodafone improving due to strong recent subscriber gains, and EE worsening slightly after a strong previous quarter. H3G’s growth worsened due to the previous quarter including some one-off benefits, but it remains very strong at 10%, with contract ARPU having stabilised

We expect the market environment to continue to be relatively benign, with the biggest disruptive threats Vodafone, which is currently competing on quality but may become more aggressive on price if it loses patience, and the fixed line operator MVNOs, who have significant distribution disadvantages but nonetheless can harm the market with discounted pricing

Amazon has announced a new smartphone, the Fire Phone – a premium-priced device with some unique features and solid hardware; only available in the US at first, its high price and small number of apps limit its appeal

Although initial sales are likely to be low and mainly confined to Amazon Prime members, in the short term the purpose of Fire Phone is simple: to drive increased mobile sales of everything Amazon sells

In the longer term, Amazon needs to avoid being locked out of digital media purchasing on smartphones, increasingly the primary connected device – this is a first, although insufficient, step in that direction

Ofcom’s fibre margin squeeze test’s initial indicative assessment concludes that BT’s current wholesale/retail pricing is ‘close to the boundary’ of creating a squeeze on its competitors

While BT can take comfort that it is at least close to passing the test, its DSL competitors (Sky, TalkTalk et al) can take comfort that BT cannot make life materially more difficult for them without failing it

Crucially, the costs of BT Sport are included in the test, so BT is now heavily dis-incentivised from further aggressive bids for sports rights, which is positive news for the prospective cashflows of both Sky and indeed BT itself

National newspaper advertising fell 8% last year (and by 28% since 2007), but we believe a stronger economic outlook will slow the decline in 2014 to about 6%, even if volatility month-to-month makes budgeting and management a relentless challenge.

The local and regional press should also experience some—but smaller—reprieve, though the sector will continue to haemorrhage national display advertising, so the sector focus must return to local enterprises.

Digital advertising has reached meaningful scale at some titles, but growth in online display is slowing. Platform sales are growing quickly and are essential to resist the devaluing of context for digital marketing in content media.