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.
Our research is independent and evidence-based, covering all sides of the market: consumers, leading companies, industry trends, forecasts and public policy & regulation. A complete list of our research can be found here.
Google Home will compete against Amazon’s Echo in the contest to supply voice-activated home hubs to US homes
Google claims Home is better at voice-based search due to its superior capabilities; pricing is unknown, but is likely to be at par with Echo ($179)
Prime, Fire devices and media services are competitive advantages for Amazon in the US that will make it hard for Google Home to succeed there
Gill Hind was quoted in an article on the European Commission decision to allow broadcasters to air more ads during prime time TV shows. Gill said broadcasters would be unwise to “pump in 20 minutes of ads an hour” because it would annoy viewers and prove unattractive to advertisers whose slots would be diluted.
TalkTalk Q4 2015/16 results firmly indicated that operations had moved on from the cyber-attack; record low churn and strong mobile (+90k) and fibre (+72k) traction with stable gross adds were all in line with the revised strategy announced last quarter and marked the best net adds performance for the year
Wholesale subscriber net adds (+49k) were critical to on-net base stability against retail net losses (-49k), highlighting the short term value of wholesaling as a hedge against heightened (and expensive) retail competition although long term sustainability will rely on traction in retail
FY17 guidance targets EBITDA of £320-360m, with an implied 17-20% margin (+3-6ppts on FY16), which is accessible from MTTS projections, lost costs from revised trading plans, and lower CPAs before counting revenue growth contributions. The operating cost impact from blinkbox, York fibre and other new cost structures appears benign for the moment
Vodafone Europe’s service revenue growth reached positive territory in the March quarter, having recovered from a long term decline that it has suffered since 2009, thanks mainly to market stabilisation within the countries where it operates
The company’s service revenues are now growing in Germany, Italy and Spain, with the UK now the laggard, having suffered from recent billing migration issues
With Europe’s major mobile markets now stabilised, Vodafone’s continued high investment levels gives it an opportunity to develop a competitive advantage and outperform its competitors, rather than just keeping up with them
2015 has been a very good year for Channel 4: excellent remit delivery, record revenues and record investment in content origination, supported by the stabilisation of audience share for its main channel, which we expect to continue in 2016.
The spectre of privatisation nevertheless looms. The government may have backed away from full privatisation, but part privatisation is still on the table. In our view, this has even less merit and promises even more conflicts of interest than full privatisation.
Channel 4 should be encouraged by the government’s White Paper on BBC Charter Renewal, which has strongly endorsed its commitment to public service broadcasting under the next 11-year Charter.
Consumer book sales look unusually resilient in the context of the extreme changes in other print media sectors, newspapers and magazines, over the past decade
Ebook and ecommerce sales have offset the high street sales decline, although the declining number of retail outlets casts a long shadow over the future of discovery
New options for authors, particularly self-publishing ebooks, threaten the existing funnel of authors to publishers, but could also be a new source of talent
Virgin Media broadband net adds of 70k were the highest in 6 years, with record market net adds share of 35% in a slowing broadband market, and the strongest consumer cable revenue growth in over a year. Project Lightning roll-out and strong marketing were the key drivers and are expected to continue over the year
Recent momentum has been largely dual play driven but TV investments, including exclusive on demand content, and a software upgrade and refreshed set top box to be launched in H2 2016, should help with ongoing TV net losses particularly as cost pressures mount from wholesale sports content
Project Lightning updates informed that of the 4m total premises budgeted for network expansion to 2020, at least 25% of these will be connected via FTTP, signalling increased infrastructure competition with Openreach whose G.fast roll-out plans potentially diminish the current cable network speed advantage (though further cable upgrades are both possible and would recover this)
BT Group’s revenue growth slipped back to 1.3% in Q4, but this reflected the reversal of various one-off boosts in the previous quarter, with underlying trends still solid across the group, with Consumer and Openreach still the standout performers
We do not think that BT’s approach of keeping the BT and EE consumer brands separate will maximize the cross-selling opportunity, but we consider this opportunity to be modest at best in any case, and therefore not worth the risk of a disruptive integration
On both fixed and mobile, BT is using cost savings to invest in faster speeds, better coverage and improved service to drive competitive advantage and price premia, a very sound strategy in our view
Claire Enders was quoted in an article on the BBC White Paper, where the government proposed that six members of the new BBC board, should be public appointees. The BBC’s director-general has opposed a plan for the government to appoint almost half its board, arguing that it would undermine the broadcaster’s independence. Claire said “the government no longer believes that [online streaming] is going to replace public service broadcasting. It does not subscribe to Thatcherite ideas about the absence of the need for a public intervention.”