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UK football rights values have pulled further away from European peers in a stagnant market, as telcos have withdrawn and tech companies remain selective bidders.

Sky and Canal+ have tied down key contracts until towards the end of the decade, while DAZN now has domestic rights for four of the top five European football leagues.

Tech players want live sport, but have distinctive demands and without new monetisation models they will not challenge pay-TV incumbents.

As Netflix transitions towards a reporting cadence that omits quarterly subscriber numbers, the focus is on revenue (+15% YoY, to $9.8 billion) and margin (+8ppts YoY, to 30%), which remain buoyant. The company has guided that 2025 revenues will be $43 to $44 billion (+$4 billion YoY), mostly due to subscriber growth

Netflix's advertising-supported tier is dragging its ARPU—however, given its important future growth role, we would expect it to start influencing the direction of the streamer's content slate

Despite its expansion into new genres, Netflix's UK viewing has further narrowed around drama and films: however, live sport, British formats and soaps could move the needle in the future

Netflix audiences gravitate towards lean-back, family films and comedies, marking a notable contrast with the kinds of TV shows which get the most viewing.

Films and TV are watched differently on Netflix: films draw more repeat viewing, are more of a communal experience and are highly sought after on weekends.

This explains why Netflix—even without a consistent, broad theatrical strategy—invests heavily in film: it brings in a discrete audience and boosts engagement for most viewers.

Both subscriber and ARPU growth are showing clear signs that they are topping out. We expect increasing volatility in both metrics moving forward as low-ARPU subscriber additions tug against price hikes and churn-cycling in wealthier regions 

Many of the studios’ streamers are now flirting with profitability thanks to cost-cutting efforts, while cord-cutting only seems to be accelerating 

Almost 50% of streamer sign-ups are opting for the ad-tier. However, it will be some time before ad-tiers become a ‘meaningful’ revenue stream

Streaming fell back into the red again, although with further price hikes on the way—along with "modest" Disney+ subscriber growth—next quarter should see the beginning of a profitable trajectory

In the UK, Disney+ continues to grow engagement—if not necessarily subscriptions—however, we still await a boost from local scripted originals

While the performance of Disney's core segments appears to be stabilising, 2024 remains a year of unfinished projects

We forecast broadcaster viewing share to drop to 52% in 2030 (from 58% in 2023), with the firming of its on demand viewing unable to balance out the decline of live: this is a slight improvement on our past estimates, with decline slowing.

SVOD viewing will begin to plateau in 2025, as video sharing platforms (YouTube, TikTok, Twitch) take an increasing share of engagement.

On the TV set, YouTube will grow strongly: we predict a 90% increase from 2023 to 2030. This is from a low base with broadcasters retaining 70% of viewing on the main screen in 2030

Netflix saw revenue grow 17% YoY (to $9.6 billion) in Q2 with margin continuing to stay healthy at 27%, approaching the levels of legacy media. It appears that the immediate revenue benefits of 'paid sharing' are now dissipating but any shift in perception around paying for the service will continue as a positive

In the UK, older viewers continue to drive viewing growth on the service—they will increasingly dictate whether something is a hit

Despite Netflix's perennial narrative of amplifying the effectiveness of foreign-language programming, English-language content continues to travel better than anything else

Netflix doesn’t think about its audience in terms of traditional demographics, instead it aligns them with ‘taste clusters’, which are formed by thousands of metadata tags on its programmes.

We have replicated Netflix’s approach to content analysis: layering its ‘mood tag’ and genre metadata with viewing data to identify what makes a Netflix hit.

Suspenseful, dark scripted dramas perform best globally, licensed high-volume sitcoms drive viewing in the UK, while unscripted TV has thus far underperformed.

AI integration into production tools throughout media industries will deliver increased productivity for professional content creation. Generally available tools will also improve quality and production speed for individual user-creators.

Roadblocks include the uncertain copyright status of models and their outputs, attitudes of creative workers and consumers, and the AI tech underdelivering versus what was promised. The need to integrate new tools into existing processes is perhaps the biggest brake.

There are stark differences by sector: the opportunities are greatest in games, where costs have ballooned and software engineering is core. Marketing is furthest in exploiting AI, while audiovisual production is more cautious.

On 4 June 2024, Enders Analysis co-hosted the annual Media and Telecoms 2024 & Beyond Conference with Deloitte, sponsored by Barclays, Salesforce, the Financial Times, and Adobe.

With over 580 attendees and over 40 speakers from the TMT sector, including leading executives and industry experts, the conference focused on how new technologies, regulation and infrastructure will impact the future of the industry.

This is the edited transcript of Session One, covering: the evolution of streaming models, and public service broadcasting in the digital age. Videos of the presentations will be available on the conference website.