TikTok has been dealt a devastating blow as a US bill has been signed into law forcing owner ByteDance to sell within a year or face its removal from app stores.
The stakes are higher than in 2020—China's opposition to a divestment will make an optimal sale harder to conclude, so all sides must be prepared for a ban.
The TikTok bill introduces extraordinary new powers in the context of the US and China's broad systemic rivalry, though online consumer benefits will be limited.
The US is intent on preventing the CCP’s goal of AI supremacy by 2030, banning exports of advanced AI chips to Chinese companies. So far, these bans have largely been shrugged off to create a new commercial dynamic in the region.
Huawei wields a de facto monopoly on the manufacture and sale of advanced chips in China. Huawei also sells cloud services globally and threatens Apple's $70 billion in Chinese revenues through its premium handsets.
China’s AI regulation is highly supportive of the training and deployment of Chinese-language LLMs developed by tech platforms, startups, and device makers, with meaningful revenue gains only appearing by H2 2024.
Market revenue growth was solid at 1.6% in Q4, but subscriber volumes were weak, and ARPU was supported by price rises.
Price rises will be much lower in 2024, with no ease in sight for volume growth, which will likely lead to much lower or even negative revenue growth.
The altnets are adding significantly to incumbent pressure, and their consolidation may ease or worsen this depending on its form.
Streaming profitability beckons, but owes much to the profitable services folded into companies’ DTC segments alongside the headline streamers.
There is a broader move towards bundling and price rises. The former bolsters subscriber additions and lifetime value but is ARPU-dilutive, while price rises will bump up both ARPU and churn.
2024 marks the first year with multiple players at scale in the ad space, as Prime Video entered the market. Other streamers with high CPMs and lower scale may be forced to re-examine their offerings.
Direct greenhouse gas emissions from the UK telecoms sector equate to around 0.1-0.3% of the UK total. Most operators have set targets to reach net zero across their direct emissions in the next 10-20 years, with the move to electric vehicles an obvious win.
Network upgrades to 5G and fibre have the potential to cut emissions from electricity by a factor of 10, and consolidation offers further decarbonisation upside.
The industry could enable emissions savings in other sectors equivalent up to 30x its own by averting the need to travel and through IoT applications, with the latter requiring careful commercial assessment given the financial constraints in the industry.
While altnets continued their strong expansion in 2023, a slowdown in 2024 is looking very likely, with financing drying up due to tougher financial conditions and disappointing operating performances from some.
Consolidation is the obvious answer, and the altnets could consolidate into a pure wholesaler (via CityFibre), a retail/wholesale player, or could be absorbed into VMO2/nexfibre.
Which of these routes is taken, and how quickly, will have a profound impact on the structure of the industry, and all players should be careful what they wish for, with long-term outcomes hard to reliably predict in such a complex marketplace.
Sony PlayStation’s next CEO will have hard decisions to make: compete against a resurgent multiplatform Microsoft, or retreat and defend an increasingly rickety PlayStation console model.
New gaming hardware will have an outsize influence in the year ahead, giving gamers unprecedented choice, starting with XR headsets and continuing to a likely new Nintendo Switch.
YouTube’s foray into browser-based games will be the service to watch in 2024. If successful, streaming services, including Netflix, will be on track to become heavyweight game platforms.
Market revenue growth was robust in Q3 at 1.4%, but heavily supported by price rises whose effect will wane over the next year.
Broadband net adds remained negative, with pay TV and telephony more negative still, mainly thanks to strained consumer finances.
Declining volumes and waning price rise boosts are likely to lead the market into decline next year, with a recovering economy needed to reverse this.
Unable to match Netflix, financially-pressed Hollywood studios are cutting content output and reassessing the DTC model
Price rises are being forced through, however for challengers this is asking a lot from subs, who don’t see an improvement in product or usage
The corporate landscape is fluid—loss-making DTC platforms and revenue-plunging linear channels are candidates for M&A
YouTube has just introduced Primetime Channels in the UK, following launches in the US and Germany, becoming another video-content aggregator in a crowded market.
The US has carried YouTube's subscription revenue boom—layering on a premium video marketplace in the UK may prove harder to achieve.
Google's NFL Sunday Ticket package offers exclusive, high-end content to US consumers. Primetime Channels' UK launch just a few weeks before the Premier League auction is interesting timing, but will not change the game.