The TV, the main screen in the house, is rapidly becoming connected to the internet, opening a new front in the battle for people's attention

Tech players, pay-TV operators, and manufacturers are all aiming to control the user interface, ad delivery and data collection, leaving incumbent broadcaster interests less well represented

To protect their position, and the principles of public service broadcasting, broadcasters will have to work with each other at home and in Europe to leverage their content and social importance

Service revenue growth for the UK mobile market improved in the first quarter of the year, lifting from 1.0% to 1.2%. There was an easing of the EU roaming regulatory impact helping growth improve, but the SIM-only drag likely grew to counteract this, suggesting a modest underlying improvement overall

We expect continued market growth improvement in the coming year due to a number of tailwinds, namely annual price rises, the arrival of IFRS 15, and the EU roaming impact dropping out

The fundamentals of the market remain solid: competition is rational; pricing is firm; data demand is strongly rising; supply is partially constrained; MVNOs and convergence do not appear a threat

The overall scale of the GAFAN digital media giants may be huge, but the cost of becoming a major player in Premier League (PL) football remains utterly disproportionate to the current scale and ambitions of their video businesses in the UK.

Furthermore, the main package PL rights are live-only, UKonly, and of limited breadth of appeal, making a poor strategic fit for any of the digital players.

The cheaper minor packages, near-live and clips rights may be a better fit, but bidding on these will not move the needle in terms of the £1.7 billion per year main PL auction rights costs.

We interviewed the biggest hitters in the UK television production sector, asking them about the current issues affecting their industry, such as consolidation, Peak TV, and Nations and Regions quotas

Most pertinent, however, was the production sector’s relationship with the new buyers—Netflix, Amazon, Apple et al.—and how their approach to them differed for each one, as well as traditional broadcasters when pitching, negotiating deals or producing programmes

With views anonymised for candour, this report is an honest representation of an industry where quality and volume are both at an all-time high, despite the challenge of change brought about by these new players

The UK mobile market is growing strongly – we estimate revenues by 5% and EBITDA by 8% in 2017 – excluding one-off regulatory drags and the loss of non-profit-generating handset revenue

Regulatory price cuts end in mid-2018, and the handset effect will disappear from all reported figures from April 2018, leaving scope for very positive headline growth next year – considerably better than its European comparators and the sluggish UK fixed market

The outlook for the UK mobile industry is the best it has been in a decade, with significant growth in data demand, price increases, some supply constraints, rational competition, and major regulatory drags rapidly fading

UK mobile service revenue growth worsened to 0.9% in the quarter from 1.5% in the previous quarter, although this was entirely due to an ARPU drop in BT/EE’s business segment. BT/EE’s consumer business is still growing strongly, and all the other operators improved their growth due to the EU roaming cut impact reducing in intensity

Looking forward, there are no further regulatory shocks on the horizon, and the annual price increases implemented in March/April are higher than previous years due to higher underlying rates of inflation. While SIM-only is likely to continue to rise, we still expect revenue growth in 2018 to be robustly positive at a similar or higher level than that of 2017

In the recent 4G/5G auction, O2 won all of the currently useable 4G spectrum available, and the 5G spectrum was split between all four operators, with H3G winning less that the others but (combined with its existing holdings) being nonetheless the largest 5G spectrum holder

Engineering excellence and user generated content (UGC) have propelled YouTube to Facebook-level reach, with growing viewing in all demographics and on the TV-set

However, the commercial limits and PR risk of its long-tail content model have prompted a diversification effort involving subscriptions and long-form content

Becoming a major part of Google’s revenue amid fierce OTT competition would require YouTube to be more flexible in its partnerships with the AV industry, and a more aggressive go-to-market strategy

Mobile service revenue growth dipped this quarter but this was likely entirely due to the predictable (and predicted) impact of the abolition of EU roaming surcharges.  On an underlying basis, growth improved

BT/EE extended its lead in both service revenue and contract subscriber growth terms. EE’s substantial investments in network quality and customer service have driven returns to scale, and its multi-brand approach is working well

Contrasting with the returns to scale seen at EE, TalkTalk’s MVNO has suffered the reverse of this, unable to break-even despite peaking at just shy of 1 million customers, and deciding to retreat to an agency model.  Sky Mobile is performing respectably well in context, but may be headed for scale issues itself

Mobile service revenue growth continued to improve on a reported basis, but most of this improvement came from a significant dip in the MTR cut drag. EE remained the leader in terms of service revenue growth, with both the strongest ARPU growth and robust contract net adds

The quarter also benefited from the current round of in-contract price increases, which were more widespread and at a higher level than last year, and from a brief holiday in the impact of roaming cut regulation, the impact of which will strongly reverse in Q3 as ‘free roaming’ impacts the whole quarter at the same time as mobile users take their actual holidays

Recent spectrum announcements have far from clarified the auction outlook, with Ofcom deciding on a more restrictive spectrum cap than its initial views but both H3G and EE appealing its decision. It will likely be some time before all 5G spectrum auction rules are resolved, let alone actually holding the auctions or building the networks

UK mobile service revenue growth continued to improve, with EE now the clear leader in service revenue growth terms. The rate of improvement has started to slow, but pricing remains solid and data traffic continues to grow healthily

EE’s performance was helped by robust subscriber growth but mainly driven by its very strong ARPU growth, which is in turn driven by ‘more-for-more’ pricing and a service/content tiered pricing model. Others are starting to follow this approach

The short/medium term outlook remains healthy, with the price increases made in Q2 likely to more than compensate for roaming cuts in the latter part of the year.  Looking further forward, the launch of 5G could be disruptive due to the introduction of copious extra spectral capacity, and therefore the results of the upcoming auction will be key for the sector post-2020