The Premier League will earn 3.5% more per year from its domestic rights for 2025- 29 than today, enough to maintain the gap with rival competitions.
Sky will pay 7% more for as many as 70% more games and cement the prominence of its Premier League coverage, while the Saturday 3pm slot could host the Women’s Super League.
TNT Sports secures its premium profile and Amazon shifts its focus to the Champions League.
Unable to match Netflix, financially-pressed Hollywood studios are cutting content output and reassessing the DTC model
Price rises are being forced through, however for challengers this is asking a lot from subs, who don’t see an improvement in product or usage
The corporate landscape is fluid—loss-making DTC platforms and revenue-plunging linear channels are candidates for M&A
The Premier League has launched its first competitive rights auction since 2018, offering broadcasters a longer four-year cycle and 70 more live games.
Sky could reduce costs by cutting down on one weekly slot, but we expect it to fight for four packages, consistent with its history of prioritising the prominence of its Premier League coverage.
Competitive tension may be the strongest between TNT Sports and DAZN.
Warner Bros. Discovery is grappling with declining legacy cable revenues and its $48 billion debt burden. DTC losses have attenuated but de-leveraging will be trickier post-2023 as many of the easier cost-savings have been achieved.
The US launch of its DTC offering, Max, attempts to dovetail IP from across Warner Bros., alongside Discovery's food, lifestyle and documentary programming, and soon, CNN. Adding sports may prove more challenging.
In Europe, WBD’s rational strategy would be to maintain a mixed distribution strategy, agreeing exclusive deals for its DTC platform with incumbent aggregators such as Sky.
Broadcaster decline accelerated in 2022, with record drops in reach and time spent. This was primarily driven by the lightest and youngest viewers leaving broadcast television while over-65s also reduced their viewing for the first time.
Loss of lighter viewers threatens the future viewing base of broadcasters and relevance to a new generation. Further, broadcaster status as the home of mass audiences becomes compromised.
However, retention of lighter viewers is not yet a lost cause. They are amongst the heaviest Netflix viewers, and the very lightest are spending more time in front of the TV set than previously—suggesting enduring appetite for TV-like content.
In the UK, carriage on Sky Q will give the new service the opportunity to prove its worth to viewers. Without integration with the UK's biggest pay-TV platform, growing scale is difficult for nascent DTC services.
Elsewhere in Europe, Discovery seeks to bundle too. Unlike the US, where the company has a single model—basic cable—in Europe it operates both free-to-air and pay channels, and it also owns Eurosport.
Ultimate success will come down to whether Discovery's "real life content" is essential and defensible. Generally there is little evidence of people taking services that are not broad, while the barriers to entry for competitors wishing to commission "real life content" are lower than other genres.
Admissions and box office revenues in 2020 will be the lowest in over three decades. The pandemic forced the closure of theatres, putting pressure on cinema to a degree unlike ever before.
The reasonable success of the straight-to-TVOD releases under lockdown has some studios suggesting TVOD distribution will live alongside theatrical in the future. However, simultaneous releases are unacceptable for cinemas and TVOD’s sub-optimal financial reality means theatrical release will remain essential for most films.
TVOD distribution will temporarily play an expanded role, while SVOD will pursue its climb up the distribution chain and big studios will assert their increased power to negotiate more favourable terms with cinema owners.
The UK lockdown since mid March has boosted TV time to levels not seen since 2014, with broadcast TV and online video each growing by nearly 40
minutes/person/day
While trends vary significantly by demographic, news consumption has been a common catalyst for linear TV’s growth, benefitting the BBC above all. Although Sky News has also flourished, Sky’s portfolio has been seriously impacted by the lack of live sport
2019 extended many of the long running trends of the last decade, but, notably, online video’s growth rate appeared to slow among youngsters, in contrast to older demographics. 35-54 year olds watching more VOD will have significant implications for linear broadcasters down the line
Despite operating in a challenging market, Sky has continued to increase revenues, with the resilient performance of its direct-to-consumer and content businesses offsetting the disappointing drop in advertising income.
Across FY 2019, EBITDA was up 12.2%; profit growth driven by a significant reduction in “other” costs as large one-off effects disappear and cost-cutting continues.
Extended distribution deals with Netflix and WarnerMedia will protect Sky’s content proposition for the coming future, as would the mooted integration of Disney+.
Comcast’s new, on-demand service, launching in April, is an attempt to break NBCU’s unsustainable dependence on sales to Netflix and other SVODs. Peacock provides a path of digital transition for advertising-funded TV with a revamped low-load, high cost-per-thousand model.
Reach will be built with a free online tier and distribution to Comcast subscribers. Peacock seeks carriage from other pay-TV operators, with which reciprocal deals would make sense (i.e. HBO Max on Comcast alongside Peacock on AT&T’s platforms).
In Europe, where Comcast has no existing major free-TV offering to transition, launching Peacock will be challenging but could present Sky with ideas to counterweigh Netflix on its own service.