Market revenue growth fell in Q3 to below 1%, and may drop below zero next quarter as existing customer pricing comes under more pressure
New customer pricing is however rising, and average pricing should rise much further as ultrafast increases in availability and popularity
Political enthusiasm for full fibre should be welcomed, although some specific plans are likely to do more harm than good if implemented literally
Virgin Media had a challenging quarter, with its early price rise driving weak subscriber figures and product spin-down, resulting in reduced revenue growth and an accelerated OCF decline
The market environment remains challenging with very competitive pricing on superfast and little push for ultrafast, but superfast pricing is easing and competitors’ ultrafast pushes should accelerate in 2020
Full fibre roll-outs remain a threat and an opportunity in almost equal measure, with Virgin Media’s positioning likely to be clarified as the regulatory mist clears over the next year
Consumer magazine circulation and advertising continue to spiral down, with notable exceptions at the top of the market and in a handful of key genres, triggering ever greater revenue diversification and innovation The market is fundamentally over-supplied and the gap between successful portfolios and the glut of secondary titles is growing. Furthermore, the distribution and retail supply chain hang by a thread There are some encouraging signs. Publishers are evolving, with their strategies and leadership capabilities increasingly defined by the needs of the industry they serve rather than the publishing brands they exploit, bringing the consumer model closer to more thoroughbred B2B models
Specialist publisher Future has offered £140m for generalist TI Media’s 41 brands, which will give Future 220 global brands upon expected completion in Spring 2020. The acquisition, which includes wholesaler Marketforce, is contingent upon shareholder and CMA approval
Future is the darling of publisher stocks, pursuing an energetic growth and scale strategy, and diversifying revenues through digital and experience innovation
How Future’s culture of experimentation and optimisation will work with TI Media’s more general portfolio is an open question. Only time will tell if the overall portfolio balance will work
Mobile sector returns are low, particularly for smaller-scale operators, with H3G earning less than its cost of capital. Regulatory initiatives, spectrum auctions and 5G look set to worsen this picture as H3G strives to gain viable scale
Back-book pricing is crucial to the returns of fixed challengers. Regulatory intervention is likely to lead to a waterbed effect in the fixed sector and exacerbate challenges in mobile
New entrant business case in full fibre is limited to de facto monopoly opportunities. There is the potential for BT’s returns to increase markedly if it gets full fibre right but new entrants’ inferior economics are unlikely to offer sufficient investor appeal
Media coverage of women’s sport escalated this summer thanks to the 2019 FIFA Women’s World Cup, which ignited national interest. The Lionesses attracted an exceptional peak TV audience of 11.8 million for England’s semi-final match against the USA
Still, coverage of women's sport remains minimal outside of major events: only 4% of printed sports articles reference female athletes. Quality press are leading the way—the launch of Telegraph Women’s Sport being the prime example—but the popular press are yet to follow
Freely-accessible coverage will generate greater interest and audiences for women’s sport, but continuous investment from all media will be needed to fulfil its potential
In China, Alibaba and Tencent compete for food delivery to expand access to a fast-growing source of mobile user data, using their chat and wallet super apps to funnel customers to their food delivery apps
In the West, the rivalry is direct between the food delivery apps – Just Eat, Uber Eats, and Deliveroo – and the costs of last-mile delivery dissuade challengers
In the UK, Amazon will change the game if it succeeds in its proposed purchase of a minority stake in Deliveroo, which Uber failed to buy last year. Progress on the merger of Amazon and Deliveroo is suspended by the regulator
Market revenue growth bounced back to all of 1% in Q2 after near zero in the previous quarter, with broadband volumes at a near standstill
Operators appear resigned to this however, with new customer pricing appearing to recover, and wholesale price cuts not to be repeated
On the downside, further regulatory and commercial pressure on existing customer pricing is likely, and pricing détentes are often short lived
Virgin Media’s results were quite mixed, with the subscriber base shrinking in a very slow market, but ARPU and revenue returning to growth despite pricing pressure and regulatory drags
The outlook remains challenging, but market pricing does seem to be easing with no repeat of the damaging Openreach price cuts on the horizon
‘Full fibre’ roll-outs will bring further challenges, but opportunities as well, with the accompanying focus on higher speeds likely to be a significant operational upside in the short to medium term
Market revenue growth dipped to around zero in Q1, with fierce competition on new customer pricing the major factor
All four of the big operators now suffer from declining ARPU, with existing customer price rises increasingly hard to land given falling prices for new customers
The rapid move to superfast is not helping as much as it should; the operators will hope that they fare better with the move to ultrafast