Service revenue growth dropped off by 2.7ppts this quarter, and into negative territory, as operators in all markets suffered weaker growth
Operators in France and the UK implemented price increases this quarter but re-contracting absorbed any positive revenue impact. In Italy, regulatory intervention thwarted operator plans to raise prices
Increasing competitive intensity in France and Germany comes at a time when operators can ill-afford ARPU dilution and high churn
Service revenue growth was broadly flat at 1.7% as improvements in Germany offset weaknesses in Italy.
The impact of price increases has been mixed, with subscriber losses dulling their upside, and the mixed picture looks set to continue into Q2.
The market continues to be challenging with elevated competition at the low end, pressure from some regulators to increase network coverage, and a somewhat soft EBITDA outlook.
On 4 June 2024, Enders Analysis co-hosted the annual Media and Telecoms 2024 & Beyond Conference with Deloitte, sponsored by Barclays, Financial Times, Salesforce and Adobe.
With over 580 attendees and over 40 speakers from the TMT sector, including leading executives, policy leaders, and industry experts, the conference focused on how new technologies, regulation and infrastructure will impact the future of the industry.
This is the edited transcript of Session Three, covering: consolidation in the telecoms sector; fixed-mobile convergence; and the future of the fibre industry. Videos of the presentations are available on the conference website.
On 4 June 2024, Enders Analysis co-hosted the annual Media and Telecoms 2024 & Beyond Conference with Deloitte, sponsored by Barclays, Salesforce, the Financial Times, and Adobe.
With over 580 attendees and over 40 speakers from the TMT sector, including leading executives and industry experts, the conference focused on how new technologies, regulation and infrastructure will impact the future of the industry.
This is the edited transcript of Session One, covering: the evolution of streaming models, and public service broadcasting in the digital age. Videos of the presentations will be available on the conference website.
Market revenue growth was maintained at 1.6% in Q4, helped by strong underlying ARPU, mitigated by weak volume growth.
Lower price rises will likely slow market revenue growth by c.1-2ppts next quarter, with BT being slowed the most at c.5ppts.
The market is being hit by lacklustre demand, growing altnets and persistent price competition, with these factors likely to persist in the short term.
Vodafone's promise of growth from FY26 has credibility given some headwinds specific to FY25 and some tailwinds emerging thereafter.
In the meantime, the issues over the coming year extend beyond TV losses—with fixed in Germany proving difficult to turn around and the challenge from diminishing in-contract price increases is a significant one (for many telcos).
Currency movements continue to absorb all notional growth (and some) and look set to continue to do so next year. With the company's FCF just half what it was two years ago, it is little wonder that Vodafone halved its dividend payout.
Reddit, a unique and valuable online space, has reported its first quarterly results as a public company, following a very successful IPO.
In the longer term, Reddit is doomed to scratch out an unprofitable existence as a wannabe scale ad platform, echoing peers in the public markets.
Advertising is probably the least-bad business strategy, as user payments, ecommerce and licensing revenues are even less proven. Dialling back growth ambitions to improve the bottom line is the most sustainable path.
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.
Service revenue took a dip in Q4 to 1.5% as a waning price rise impact in the UK combined with the loss of positive one-offs in Germany.
We expect growth to slow further through 2024 as many operators implement lower index-linked price rises which are also coming under increasing regulatory scrutiny.
Vodafone has made progress on its turnaround plan—striking deals for its Italian and Spanish units—but it is not yet out of the woods, with ongoing challenges in Germany and approval still uncertain in the UK.
Recent advances in 'Artificial Intelligence' have generated excitement, investment and improved valuations, on the plausible promise of greater efficiency in a range of areas, such as health and coding.
It is still not clear who will profit from this boom. Currently chip-maker NVIDIA is cleaning up, propelled by sales to model developers, also driving demand for cloud computing services.
Leverage in the AI value chain depends on differentiation and barriers to entry, which are high in the chips industry. AI services like chatbots have much lower barriers to entry, while deeper vertical integration of more stages of the value chain could shake things up.