Both the commercial and BBC radio sectors generally seem to be in good shape, with radio listening also appearing robust. However, this masks a steep decline among younger adults that shows no sign of slowing down

With radio content available at the swipe of a finger, the linear schedule becomes less relevant, and the challenge broadcasters face is to create online hooks for the broadcast output

News Corp’s acquisition of TalkSPORT will open up new business opportunities as well as consumer engagement across The Sun and TalkSPORT and may prove an important milestone for the Sun brand

European service revenue growth improved in aggregate but with traction noticeably gradual and fragile, and growth remains negative. The future of this fragile recovery is highly uncertain in the wake of a vote to take the UK out of the EU. Most economists have budgeted a slowdown in UK GDP growth, revising 2017 expectations from around 2% to near zero or below. The IMF expect 1.3% growth in 2017 (-1ppt revision) based on “limited” Brexit impact with implied potential for further downward revisions, and it has made more modest cuts to forecasts for other European markets

Mobile service revenues are susceptible to the slowdown but we believe there to be sources of resilience in the revenue stream that would temper the impact including much reduced prepay share of the base, heavily eroded ARPU differential of contract users over prepay and contract tariff value for money, bundling trends, high smartphone penetration (>64%) and data attachment rates (>75%), and 4G coverage and penetration

Following a failed acquisition of O2 in the UK, H3G have turned focus to the proposed JV merger with Wind in Italy where offered remedies are rumoured to have been found acceptable although official confirmation (pending) is only due by 8 September. These include furnishing Iliad as a replacement fourth market entrant with uncertain consequences for the Italian market

Online growth has opened up a new window of opportunity for production companies in short and mid form “online-first” content, with the last few years seeing a steady increase in the number of production companies entering this space 

So far, persistently low broadcaster online-first budgets and poor financial returns from video distributed online has held back growth of mid and short form video. Instead, the main growth in recent times has come from “brand” commissions 

Yet whatever the type of commission and its financial value, short and mid form commissions are eagerly sought after, whether as a potentially lucrative income stream, especially in the case of branded content, or as a calling card for long-form commissions from broadcasters and OTT players such as Netflix and Amazon

The DCMS has published the government’s response to its consultation on the balance of payments between television platforms and public service broadcasters, the so-called issue of retransmission fees

One sure outcome is that Section 73 of the Copyright, Designs and Patent Act (CPDA) 1988, which has hitherto protected cable operators (i.e. Virgin Media) from having to pay retransmission fees, is outmoded and will go

But, we now have a disconnect. The government has stated unequivocally that it expects the continuation of no net carriage payments between the licensed PSBs and the platform operators and may consider legislative changes to ensure this. And yet ITV sees the government response as a welcome first step towards their introduction

UK mobile service revenue growth marginally improved in Q1, to 0.5% from 0.3% in the previous quarter, with the market now having been stuck at a modest but positive growth level for two full years. The improvement was driven by contract ARPU growth improvements, across all of the operators, partially mitigated by a drop in contract subscriber volume growth, perhaps influenced by a weak market for new handsets

Looking forward, the competitive outlook is very uncertain; while EE is looking to increase its network lead, whether it wishes to use this to boost share or pricing is unclear, O2’s future owners may have different strategic priorities to the status quo, H3G will likely take innovative approaches, which are tautologically hard to predict, and Vodafone UK remains Vodafone’s only large European market without a scale position in consumer broadband, a situation it is likely to want to rectify in due course

While before the Brexit referendum, we would have concluded that the outlook for market-wide revenue growth was reasonably positive in spite of this, with ever-strong data volume growth contrasting with constrained spectrum supply, the extra economic uncertainty due to the referendum result puts this at least partly in doubt. The mobile market is likely to be relatively insensitive to macroeconomic conditions given its increasingly essential nature, but there is some sensitivity, particularly if population growth slows or reverses. Our base case assumption is a dip in growth of 1-2ppts in 2017 as a consequence of Brexit

Our survey results highlighted disconnects between operator ambition and consumer perceptions across customer loyalty, network performance and quad play, with noteworthy implications for future competitive performance. O2 in particular benefited from strong branding which yielded network confidence and loyalty above that of top network investors, EE and Vodafone

Convergence prospects continue to look supplier driven with consumers reporting little interest in quad play packages even when offered with significant bundle discounts. Recent advertising campaigns have sought to change consumer perceptions of a dichotomy in mobile and fixed broadband provisioning which, if successful, will be to the benefit of all quad play hopefuls

The mobile usage disparities between 16-24 year olds and 55+ users are stark, for instance near 100% of mobile users aged 16-24 own a smartphone while for those 55+, this falls to just over half. The implications are strong for service providers in all manner of industries who are seeing new (younger) users come to market that bear little resemblance to the traditional users around whom much of the operational model is typically built

TV viewing has one reliable, long term trend: programme genres are watched by consumers at predictable life stages and ages

At a high level, there has been little manipulation of the balance of genres being broadcast. But amongst the sub-genres, editorial optimisation has resulted in an uptick in actual viewing

As the core viewing age of linear television rises, there is an opportunity for broadcasters to leverage this to create the most desirable schedule for their available audience by daypart; with genres that transcend demographics when younger viewers tune in

2015 has been a very good year for Channel 4: excellent remit delivery, record revenues and record investment in content origination, supported by the stabilisation of audience share for its main channel, which we expect to continue in 2016.

The spectre of privatisation nevertheless looms. The government may have backed away from full privatisation, but part privatisation is still on the table. In our view, this has even less merit and promises even more conflicts of interest than full privatisation.

Channel 4 should be encouraged by the government’s White Paper on BBC Charter Renewal, which has strongly endorsed its commitment to public service broadcasting under the next 11-year Charter.

BT Group’s revenue growth slipped back to 1.3% in Q4, but this reflected the reversal of various one-off boosts in the previous quarter, with underlying trends still solid across the group, with Consumer and Openreach still the standout performers

We do not think that BT’s approach of keeping the BT and EE consumer brands separate will maximize the cross-selling opportunity, but we consider this opportunity to be modest at best in any case, and therefore not worth the risk of a disruptive integration

On both fixed and mobile, BT is using cost savings to invest in faster speeds, better coverage and improved service to drive competitive advantage and price premia, a very sound strategy in our view

Short form video is growing. It is easy to create, share and, with the rise of mobile technology, incorporate within communication

But despite the novel flexibility that mobile technology offers, the actual video most desired is surprisingly traditional

Buzzy, short form content fills gaps that have always existed; yet, despite the hype, it will remain supplementary to long-form programming