BT Group’s revenue growth surged in Q1 to 1%, the first time it has been positive in five years, with a stronger than expected boost from the April price rises partially offset by the Virgin Mobile MVNO loss.

EBITDA growth, however, actually dipped to 2%, with little operating leverage due to cost pressures, although the company is still very confident in its full year EBITDA guidance (which implies 4% growth).

BT is far from immune to macroeconomic pressures, with pressure on costs, corporate revenue and signs of a sharp dip in broadband market growth, but it is well placed to deal with them given strong growth at Consumer and Openreach.

UK altnet full fibre rollouts are accelerating, with an aggregate build pace close to that of Openreach, but customer acquisition is not growing at the same pace, and overbuild in the most attractive areas is becoming a significant issue.

Altnet business models remain challenging and are getting worse as Openreach builds out, and (although there are some notable exceptions) most will need to rapidly achieve scale and turn around their performance to survive.

Consolidation is very likely, along with business failures, and while some market share loss for Openreach looks likely as serious scale players emerge, the downside is limited, and even more so for retail ISPs.

Global SVOD operators are expanding their sports content offerings. Amazon just bought UK Champions League rights, Apple signed US baseball and global football (soccer) deals, Paramount and partners won the Indian Premier League cricket auction, while Netflix unsuccessfully bid on the US Formula One licence.

In the US, streamers feed an already very competitive market, while in Europe they could potentially relaunch inflation for rights after a period of stagnation. Next moves by Warner Bros. Discovery (BT Sport and Eurosport) and Disney will be critical. Sky and Canal+ could be facing upward cost pressures.

If rights fragmentation were to increase, deeper aggregation and bundling may be necessary to avoid shrinking the consumer pool while the pressure to consolidate may intensify. Intriguingly, global rights deals may become more likely.

European mobile service revenue growth was positive for the first time in five years this quarter as a resurgent mobility boost combined with the return of roaming revenues.

Q2 is set to be a mixed bag, with inflation-plus price increases expected in the UK, an elevated boost from the roaming recovery, but also some weakness in the B2B market.

We are also seeing the early impact from end-of-contract notification rules, particularly in Germany, and we expect ARPU pressure and churn to pick up elsewhere as the impact becomes more widespread.

The market looked superficially healthy in Q1, with revenue and broadband volume growth both maintained at 2%.

However, net adds trends suggest that consumers are becoming more bargain seeking, and prices have become more competitive into Q2.

The April price increases will support growth in the short term, but this boost may not last long if the cost-of-living crisis persists.

BT’s Q4 was mixed in the detail, with consumer broadband volumes weakening but FTTP roll-out and adoption surging, with performance at the Group level solid enough.

The April price increase has reportedly landed well, strongly supporting BT’s guidance for revenue and EBITDA growth in 2022/23 with no other improvements required.

The macroeconomic environment continues to weaken, affecting BT and its premium brands in a number of ways, but it appears to have enough room in its guidance to weather this storm.

Sky continued to grow its UK revenue thanks to price rises, mobile customer additions, and a rebound from lost hospitality business in early 2021, but this was still outweighed by the recent reset of its Italian operation

Aggregation remains a core focus, with Paramount+, and Magenta Sport in Germany, added to Sky’s bundles, while fibre rollout will intensify with the launch of Sky Stream puck as a standalone device later this year

Declining buying power raises uncertainty over consumer behaviour: in previous recessions, pay-TV performed well, but today subscribers have more video options than ever before

Broadcast TV viewing resumed its downwards trajectory in 2021, following a pandemic-inflated boost in 2020. The effect has been compounded by streaming services retaining much of their lockdown gains, consolidating their place at the heart of people's viewing habits

Within the shrinking pie of broadcast TV viewing—still c.70% of total TV set use—the PSBs have held relatively steady, whilst Channel 5 has increased both its share and absolute volume of viewing

However, further decline seems inevitable, with the largest components of the programming landscape, namely longstanding formats and the soaps suffering badly since the beginning of the pandemic. We await the effect of various new scheduling strategies

Channel 5 has been a rare recent success story in linear television, growing overall viewing and share while beginning to shake off the perception of being the home of cheaper, exploitative programming, consolidated under the ownership of Richard Desmond's Northern & Shell

The programming shift—most notably in investment in lower-price-point British drama—has been made possible with savings from axing schedule centerpieces Big Brother and soon, Neighbours. However, this will result in continued declines in 16-34 viewing share

The other channel brands of Paramount Global (formerly ViacomCBS) are in a gradual downswing: My5 is subscale, while Pluto TV makes less sense in the UK than in other markets. We wait with interest as to how upcoming SVOD, Paramount+, will differentiate

Market revenue growth accelerated to just under 2% in Q4, with broadband growth holding up despite the ending of most pandemic restrictions.

Backbook pricing pressure should continue to retreat in 2022, and ultrafast speed premia should also bolster ARPU as FTTP roll-outs accelerate.

The price increases due in April will further support growth, with BT in particular to benefit, and all will have to be wary of customer backlash.