Vodafone KPIs - strategic issues

Ofcom is curtailing Openreach’s price discounting for now, effectively setting a price ceiling based on theoretical altnet economics as opposed to Openreach’s own (much lower) fibre costs.

This restriction is however likely to prove time-limited, with VMO2-only areas and those with high altnet market share likely to be de-regulated first, and within the current regulatory cycle.

VMO2 and the altnets need to be prepared to compete on a more even footing, and would be wise not to hasten deregulation through their own actions, such as focusing on market share grabs as opposed to building a sustainable business model.

Service revenue reversed its slight improvement last quarter, worsening 0.2ppts to -0.9%, as all markets except Spain were flat or in decline.

Incumbents in Europe are increasingly trending towards outperforming peers on net adds, despite higher (and more stable) ARPUs.

EE and Vodafone’s recent launches of premium tiers using 5G slicing are the boldest moves in this direction we have seen in Europe, and present challenges and opportunities going forward.

Channel 4 Sales will be selling linear and broadcaster VOD advertising for Paramount channels from January. For the first time Channel 4, Channel 5 and UKTV's channels will be available through one sales house.

C4/Paramount/UKTV will match ITV Media for total viewing, but ITV1 remains the only channel that consistently delivers mass simultaneous reach.

While Sky Media's loss of Paramount in January significantly reduces its size, this could be a blessing in disguise, easing potential competition concerns over the acquisition of ITV's M&E business.