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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Claire Enders discusses the competition between BT Sport and Sky Sports, as BT accuses Sky of 'bribing customers'. With Sky hitting back saying that this was on the day BT ran full page adverts attempting to entice customers with free broadband and sport. Looking ahead to the next cycle of domestic Premier League rights Claire shares her views on the continuation and sustainability of this highly competitive atmosphere.
BT faced a more intense battle in the broadband market in the September quarter, and lost some net adds share, but retained its #1 spot and is still growing well
Revenue growth fell at both the group and consumer level, but this was largely due to the BT Sport direct revenue benefit annualising out, with growth excluding this actually improving a touch
The flip side of this is that the negative cost impact is also annualising out, and cost reduction in the quarter looks weak in this context, but this is likely due more to discretionary spend on new products than a lack of costs to cut
Recently we attended the inaugural IABUK Digital Upfronts, in which 11 digital media companies pitched their wares to advertising agencies and advertisers.
UK growth in internet advertising is now powered by mobile, social and video, and these three areas were the focus of the Upfronts.
The Upfronts are symbolic of the rising importance of digital media in the UK and worldwide; while broadcast television remains the king of brand advertising, marketing and advertising are becoming less TV-centric.
EE’s 4G adoption continued to surge, with 1.4m net adds, over 80% of new contract sales taking 4G and just under 40% of contract base having adopted it
Mobile service revenue growth however slowed to -2.4% from -1.1% the previous quarter, with an extra regulatory hit from the EU’s ‘Consumer Rights Directive’ doing some of the damage, as well as some underlying weakness
Operating revenue growth (i.e. including fixed and revenue from MVNOs) was much healthier, helped by the fast growing fixed broadband business, but growth in mobile is crucial to driving profitability given the operating leverage involved
Q1 2015 results show steady underlying revenue growth in retail subscription and increases in other segments, along with the continuing extraction of cost efficiencies, resulting in an 11% year-on-year increase in Q1 operating profits
Quarter-on-quarter, Q1 2015 retail subscription revenues and ARPU were flat in spite of the strong uptake and growing use of connected products. Main causes appeared temporary - a mixture of seasonal factors and the launch of Sky Sports 5 with its two-year free broadband offer - while underlying growth remains firmly positive
Meanwhile, Sky’s accelerated investment in connectivity during 2014 is bearing fruit. Eyes may be focused on the formation of the “new Sky” (on schedule for November) and the long awaited Premier League auction, yet other developments such as Sky Store and Sky AdSmart also deserve full attention
In the last few days we have spoken to key authorities in advertising in the US, UK and Europe.
We have been exploring the critical debate: the degree to which TV consumption and TV advertising are shifting and will shift to digital. Recent media coverage has argued traditional TV business models could start to unravel in the medium term. We disagree.
ITV and Channel 4 have asked the regulatory authorities to review the case for legislation that would for the first time allow the commercial PSBs to charge carriage fees for their main free-to-air channels on the pay-TV platforms
To this end, ITV has presented a detailed analysis showing the great contribution to the US creative economy due to the introduction of Retransmission Consent Compensation for free-to-air broadcasters in the US, but without setting this against the very different market structure in the UK, where the commercial PSBs enjoy significant privileges
Any change to UK rules will require primary legislation and is not expected until after the May 2015 General Election. Should action be taken, the choice appears to lie between regulation (adding “must carry” rules) and deregulation of commercial PSB privileges, where the end result might not be what the PSBs wished
EE has launched a new TV service featuring an advanced set-top box with a snazzy interface offered for free to its broadband/mobile customers
The lack of premium content means that the service is of little threat to the established pay TV operators Sky and Virgin Media, and the lack of integration with mobile or steep quad play discount makes it non-threatening to the mobile market
It does however reposition EE Broadband as a differentiated service, making it more competitive without lowering its headline price, with triple play the focus of this move in our view
The period between 2010 and 2013 was one of technological change in video consumption as connected devices achieved mass market adoption and online video players grew in popularity
Amongst the young, TV set viewing fell across this period, particularly in the UK, but this shift in behaviour has yet to impact older demographics in the same way. An ageing population, and associated longer viewing time among older audiences, helped maintain the total number of TV minutes viewed in the three key markets of the UK, US and Germany
Video industry revenues also look resilient; internet advertising has not impacted TV advertising to the same extent it has print, while we are yet to see any meaningful evidence of cord-cutting as a result of increased penetration of SVOD services