VMed’s Q4 results were again mixed, with underlying cash flow growth hit by high capital expenditure primarily relating to accelerating TiVo box installations

But this strong take up of next generation TV, and real progress at the Mobile and Business divisions, give us confidence that the company’s strategy is working

Management guidance of further cash flow growth from the second half of 2012 is credible, though we continue to expect underlying growth to be limited

Rumours that News International will consider launching a newspaper to replace the News of the World have circulated for months, and probably only one event can dispel them

Trinity Mirror has picked up the bulk of the 60% of NoW copies that have not entirely fallen out of the market since June 2011, and arguably the longer any launch is delayed the harder it will be for NI to attract them back

The £150 million revenue once generated by NoW is diminished and dispersed among rival publishers and we estimate that even a triumphant launch would likely generate half to two thirds of the income of the closed title

The launch of Netflix in the UK and Ireland has ignited the debate on the threat from over-the-top video to pay-TV services from Sky, Virgin Media and BT

Unlike in the US, Netflix’s UK prospects and those of competitors such as Lovefilm, are fundamentally limited, given the availability of low priced pay-TV with strong on-demand components included for free

The impact of Netflix on the UK pay-TV industry is therefore likely to be even smaller than the (hard to discern) effect it has had in the US

Virgin Media’s plan to double the line speed of most of its broadband customers is the latest in a series of moves to retain its position as the leading high speed internet service provider in the face of BT’s deployment of next generation access (NGA)

The move presages further price increases and an upgrade to offers for new cable customers, but is in the first instance about retaining the large existing base of cable customers currently on 10 Mbit/s

The £150 million or so of incremental capex required is small in the context of NGA, but the impact both on cable churn and demand for higher speeds across the wider market is by no means certain

As Phase 1 digital shift from broadcast analogue to digital nears completion, individual platform growth trends have almost flattened out

The most likely area of change in platform trends over the next ten years concerns basic only subscription pay-TV, where we anticipate an overall increase in the total pay-TV base and change in platform balance arising from the introduction of low price basic packages

Phase 2 digital convergence between TV and the internet promises to take many years to reach maturity, and many questions need to be addressed in order to be able to assess its potential impact on the current broadcast TV marketplace over the next ten years.

In this presentation we show our analysis of trends in UK broadband and telephony to September 2011, together with our latest projections for residential broadband subscribers and market shares to 2016. Highlights for the 2011 September quarter include accelerating growth in the number of subscribers to high speed broadband, and the continuing increase in market share of BT Retail and BSkyB at the expense of virtually all other players. This quarter’s edition includes a look at high speed broadband pricing, and our take on the new guidelines on broadband advertising.

Although we continue to expect broadband subscriber growth to drop, we expect growth to be supported by increasing adoption among older and/or lower income householders, who are becoming more aware of the benefits of going online. We have also increased our residential market share projection for BT Retail, which has gained real momentum over the past year, with brand strength among late adopters and effective marketing of high speed broadband both having an impact.

Spotify has just passed the 2 million subscriber mark in Europe and the US, and could reach 2.5 million by the end of 2011

Smartphone adoption and partnerships with MNOs and ISPs have proven a key driver of subscription in Europe for Spotify, which lacks a telecoms partner in the US. We think subscription is profitable

Spotify’s lower usage caps on the freemium tier will help compress total losses in 2011 in relation to the £25 million reported in 2010, despite the US launch

Q3 results were contradictory, with accelerating demand for enhanced services and resilient revenue, but high churn and weak growth in fundamental cash flow

Cost increases struck us as justifiable in the longer term and were in some cases temporary. We share management’s confidence that there is better news to come, particularly at Virgin Media Business

Nonetheless, we remain of the view that future cash flow growth is likely to be significantly lower than that seen over the past two years, particularly given the deteriorating economic outlook

Sky’s Q1 2012 produced strong 16% year-on-year headline growth in adjusted operating profits, although weakening TV product net additions underlined the challenging economic conditions

Churn remains comparatively low in spite of the economic conditions, while Sky’s current round of major investment in entertainment content, now showing the first signs of bearing fruit, could prove vital to holding churn down and stimulating gross additions

Growth in home communications dropped back compared to the level seen the previous autumn, but was still well above that seen in 2009/10 thanks to strong growth in standalone sales

National newspaper circulation continued its inexorable decline in September, with daily circulation down 7% year-on-year, although we estimate retail sales value decline was marginal

Sunday popular and mid-market newspaper circulation fell 4% month-on-month, as News of the World buyers continue to drop out of the market; we estimate around a third of ex-readers have not migrated to another title

Publishers are responding to circulation decline in a variety of ways, from churning out bulks to maintain scale, to increasing cover prices, axing international editions and developing their subscriber base