The US scripted content boom is spilling over into Europe: Free-to-air TV drama ratings have proven resilient but as costs and audience expectations have risen budgets are under pressure, necessitating flexible co-financing arrangements with American broadcasters, and Netflix and Amazon. Pay channels have boosted output—with uneven results

Long-term IP control is a key factor behind independent production consolidation, led by broadcasters seeking a secure stream of content and diversification away from advertising

Notable developments include the new wave of Berlin-based, internationally-financed series, the rise of domestic French content and Sky Italia’s edgy originals, Telefónica’s giant leap into Spanish dramas, and the continuation of Britain as an export powerhouse

BT had a reasonable quarter in its consumer broadband business given market pressures, and a very strong one at EE with continued growth acceleration. It had a good quarter for fibre adoption as well, helping its wholesale divisions stabilise their revenue, but business/IT was weak as expected

Regulatory pressure remains intense despite the (welcome) Openreach agreement, with price cap regulation proposed or due on a range of products, and a regulatory approach which is far from investment-orientated

Pressures in the business/IT market are likely to continue, and pressures in the consumer broadband market are likely to intensify, justifying BT’s current cautious approach to guidance and dividends

Our latest forecasts point to the continued strength of DTT within the UK broadcast market. We predict DTT-only homes will account for 42% of TV viewing ten years from now, up from 38% today.

Much of this is due to the UK’s ageing population profile, since DTT skews older. The number of over-45s in DTTonly homes is set to increase by 13% by 2026.

The other key factor is the continued growth of flexible pay-lite services—for example, Netflix and NOW TV— which are of greater appeal to younger audiences.

Enders Analysis co-hosted the annual Media & Telecoms 2017 & Beyond conference in conjunction with Deloitte, Moelis & Company, Linklaters and LionTree, in London on 2 March 2017.

The day saw over 450 senior attendees come together to listen to 30 leaders and senior executives of some of the most creative and innovative businesses in the media and telecoms sector, and was chaired by David Abraham.

This report provides edited transcripts of the presentations and panels, and you will find accompanying slides for some of the presentations here.

Videos of the presentations are available on the conference website.

The latest auction of UEFA Champions League televised UK rights has seen further high 32% inflation as BT renewed its ownership for the three seasons from 2018/19 for an annual payment of £394 million

Although BT annual payments are to increase by £95 million from 2018/19, the new contract offers added commercial attractions, though we expect BT’s efforts to monetise them will fall some way short of the cost increase

However, BT had to win to cement its position against Sky as a strong number two in UK premium pay TV and we expect weaker future inflation of premium football rights. For Sky followers, the focus is now on the UEFA auctions in Germany and Italy, where the outcome is far from certain

In the UK, traditional broadcast television's future appears threatened, as technological developments increasingly allow people to access video content on demand, whether on TV sets or other screens, or from traditional broadcasters or online services.

This report examines the extent to which timeshift viewing, by which we mean personal video recorder (PVR) playback and viewing to catch-up services, has bolstered linear TV.

The linear schedule is still very relevant for both consumers and advertisers, maintaining television’s status as an effective mass medium for building brands.

BT had a strong quarter for revenue growth, improving to over 1%. This was helped by some temporary factors, but underlying trends look nonetheless strong across the board

Network development looks strong, with G.fast pilot pricing announced and development on track, selective FTTP builds gaining momentum, and mobile coverage and speed capabilities accelerating

Despite this, or perhaps because of it, the regulatory outlook is as murky as ever, with Openreach’s future structure still not resolved, spectrum auction rules still to-be-decided, and rulings on copper and fibre pricing from April 2017 heavily delayed

With the decline in its subscriber base accelerating and following an antitrust veto over its planned tie up with BeIN Sports, Canal+ has decided to radically restructure its retailing on IPTV – where over 60% of subscriber recruitment takes place 

The basic channel package is now wholesale to ISPs and included in upper tier triple play bundles – much higher volumes should more than balance a deep price cut. Soon premium and optional packages are to be unbundled on all platforms to create cheaper entry points and favour subscriber customisation

Canal+ is thus increasingly focused on supplying premium content, leaving the user interface to ISPs. Without the scale of other international content producers and in a nationalistic political context, we believe that this market rationale will eventually lead Vivendi to sell Canal+ to Orange

BT Sport has seen a very clear positive impact from its first year airing the Champions League, with viewing up 60% year-on-year to June. Remarkably, its reach is now not too far off Sky Sports, though it still has some way to go in terms of consistent viewership.

Pay-TV audiences for the 2015/16 tournament were in line with previous years – an impressive feat – but free-to-air disappointed. However, BT should not be too concerned – it has established itself as a worthy pay-TV partner.

While BT’s execution has thus beaten reasonable expectations, BT Sport still carries a heavy net financial cost for BT, with debatable benefits. Yet, whatever the benefits may be, more viewers watching more often must surely help.

BT will soon for the first time charge the majority of viewers for their own channels with the launch of the BT Sport Pack. The Pack includes BT Sport Europe, exclusive home to UEFA’s European football tournaments from this August, the rights to which BT are paying £299 million a year.

Viewing figures for the big European tournaments are not as high as one might expect given their prominence. Consumer demand for the new channel will also be highly dependent on the success of British teams, notably lacking in recent seasons.

We therefore do not expect a dramatic impact on BT Sport (or BT broadband) subscribers, and the widening losses will put pressure on BT’s margin squeeze test regulation, although they are easily absorbable at BT Group level.