Free-to-air broadcasters, pay-TV operators and OTT services all have a role to play in serving sports audiences.
DTC services will enable sports organisations to engage with and learn about fans.
The industry needs to continue adapting to younger generations’ viewing preferences, particularly if it is to have a chance of combatting piracy.
2020 promises a year of transition for the games industry: eSports and games broadcasting are competing with traditional programming; game streaming services are becoming meaningful platform competition; and new consoles are on the way.
While most in the studio and TV industries continue to struggle with the games market—neither understanding (or seeing) a strategic fit, nor showing a willingness to invest—expect explosive growth to power the industry for the next decade and transform all entertainment services, not just games.
The ‘free-to-play’ games sector requires oversight and regulation to protect children and the vulnerable; expect regulatory turbulence in the UK, Europe and China.
Despite two decades of online disruption, the UK remains reliant on traditional platforms and brands across the media sector more so for older cohorts, but also for younger generations
13% of adults still do not use the internet and, in reality, an online only media ecosystem remains a distant prospect
Traditional providers, particularly within TV, radio and news, look set to endure for the long term , aided by the trajectory of the UK’s ageing population
Vodafone’s revenue performance remains decidedly lacklustre. Italy and Spain are struggling to bounce back, Germany is still languishing, and the UK’s 0.6% service revenue growth is the highlight of the quarter.
Liberty Global’s assets are disappointing both in terms of opening financials (revenues and EBITDA 8% and 12% lower than expected respectively) and outlook (now growing at half the rate at the time of deal announcement and guidance for Germany as a whole to be ‘flattish’).
Vodafone’s guidance for a pickup in revenue growth to more than 1% in Q4 is encouraging but these are very tentative steps forward in challenging times.
Our all media ad forecasts predict 4-5% growth in advertising expenditure on UK media in 2020, driven by double-digit growth of pure play online, expected to reach 58% of total spend this year, up from 55% in 2019.
We expect that pure play online spend will grow by 10.9% in 2020, while TV and Press continue to fall by 3.1% and 8.6%, respectively.
Although the economic outlook for 2020 is more positive than 2019, debt-fuelled growth in spending is a continuing concern on the consumer side.
Car transactions are down for the third consecutive year and consumer demand is dramatically shifting (away from diesel and towards alternative fuels), but the marketing expenditure on used cars remains robust overall. Auto Trader has extended its leading position as the largest used car portal, so far shielded from the structural headwinds affecting its core customer group of dealerships. Several disruptors have entered the UK automotive space in the past couple of years, but none have gained real traction in the listings space, instead opting for ancillary approaches. Tech disruption will come, but much longer term.
Expenditure on UK classifieds peaked in 2004, but has since almost halved to £1.95 billion in 2018. In every vertical, the print to digital transition of expenditure has favoured a first mover, leading to dominant positions that challengers find hard to disrupt.
The property market was stagnant in 2019, with stable house price growth but low transaction volumes as Brexit uncertainty held back sales. An expected cut in interest rates this year should contribute to a slight rise in transaction volumes.
The low tide of transactions has cemented the reign of Rightmove and condemned challengers to low traction. No. 2 player, Zoopla, plans for a major drive in 2020 after a 1.5-year investment spree by parent private equity firm Silver Lake Partners.
European mobile revenues remain decidedly in decline this quarter at -2% – a slight worsening since Q2 as the full force of cuts to intra-EU calls hits
There are signs that dual-brand strategies may be reaching their useful limit as erstwhile premium customers shift to value
There is scope for some trends to slowly improve from here, although end-of-contract notifications will impact all markets before the end of 2020, with the UK first off the blocks in Q1
Amazon Channels’ aggregation of third-party streaming services enhances the consumer appeal of its wider video proposition, provides incremental revenues and increases the stickiness of the Prime shopping service
Content partners range from major players (e.g. Discovery and ITV) to the more niche (e.g. MUBI and Tastemade), who all benefit from a ready-made platform, billing relationships and a receptive subscriber base. But the revenue shares, data costs and lack of direct customer relationships remain too high a price for some
Two and a half years on from its UK launch, opportunities for live, ad-supported and bundled content are diversifying the platform, but Amazon must prioritise discovery within Prime Video to continue to flourish
Vodafone continues to strike a very shareholder-friendly focus and tone but its operating performance remains decidedly muted, with revenue growth up just a touch but EBITDA growth halved
Vodafone’s drive for convergence is still costing it dearly. German mobile ARPU is down 7% and Liberty Global’s assets disappointed on their first consolidation with cashflow enhancement less than half that expected
Apart from its ill-advised convergence strategy, Vodafone is making many sensible moves and there are indications that its unlimited plans are gaining traction. With leverage tight, pressure is mounting for demonstrable improvements in the financials some time very soon