ITV’s total advertising revenue (TAR) across the first nine months was down 2% year-on-year, £25 million less than the company had expected at the end of July. This was still up on pre-COVID levels. With a strong Q4, TAR is expected to be down 1.5% across the year, while high inflation of costs and greater reliance on Studios will ultimately challenge margins

ITVX will be fully launched on the—slightly delayed—date of 8 December 2022. We are confident that it will be a step change for ITV's online engagement, however we believe that ITV may be understating its potential cannibalisation of linear

ITV Studios appears to be beating the market, and there may never be a more opportune time for its mooted partial sale: across the industry inflation will make margins difficult to grow while overall content demand is plateauing at best 

Revenues were stable year-on-year in Q3, with UK growth offsetting Continental decline. All three markets posted positive customer net adds across the quarter.

Underlying profitability is improving, and although World Cup-related changes to the football schedule depressed net income in Q3, they will lift it in Q4.

A possible sale of Sky Deutschland would make sense if it helps the buyer reach superior scale within Germany.

Disney’s core competitive advantages reside in its IP stock and in consumers’ lifelong affection for its brands, but the company faces a growing challenge from much larger tech platforms, pushing up the costs of production, sports rights and access to future IP.

Disney’s resources for content expenditure are now flat. The fat profit contribution from US linear channels may soon start to decline whereas direct-to-consumer losses at Disney+, Hulu and ESPN+ are still increasing, and the recovery of parks could be capped by the worsening economy.

With its recognisable IP, Disney will benefit if global video viewing continues to coalesce around fewer, bigger series, although a weak future cinema market— which Disney dominates and leverages—will impair the creation of big, new IP properties. China and India’s potential may not materialise soon.

Amidst a wider economic slowdown in the UK due to the cost-of-living crisis and the rising trend of borrowing costs, the Q4 retail spending peak (27.9% of total retail in 2019) will continue to be the dominant theme for retailers and advertisers in Q4 2022

Pandemic work and life patterns more fully reversed in 2022, with offline retailing recovering. Online share is ticking down to a new baseline of c.25% of retail (excluding fuel), thanks to food stores, the main pandemic gainers—now 10% of the vertical and contributing a huge 15% of online retail spend

Online promotions (Black Friday, Cyber Monday) have gained traction over the years, drawing retail spend into November from December, and inevitably motivating a pull-forward of advertising expenditure, with online advertising increasingly focused on the bottom of the consumer purchasing journey, favouring intent over brand

60% of Chinese online ad spend is directly driven by ecommerce, compared to 40% in the West. The gap will close as content and ads move closer to transactions.

General search engines are not central to the customer journey in China: Baidu fell below 10% of online advertising last year, compared to Google’s c.55% share in the UK.

The Chinese model now has a vector to the rest of the world in the form of TikTok, whose parent company ByteDance added more retail GMV in China than Alibaba last year. TikTok wants to grow video shopping in the West, targeting a huge $470 billion in transactions by 2027.

The Nordic streamer arrives in the UK on 1 November with two ad-free tiers: a basic £3.99 per month service featuring (mostly) Nordic scripted content, and a £14.99 version including sports, thanks to recently acquired Premier Sports.

Viaplay’s UK economics will revolve around sports: it has to demonstrate that there is room for a new premium service in the market. Substantial marketing efforts and distribution deals with the likes of Sky and Amazon will be critical to build penetration.

The UK is the latest territory in an ongoing aggressive international deployment that has driven Viaplay into loss. It aims at multi-territory economies of scale, which work for scripted content, but appear illusory for sports.

After two quarters losing net subscribers (-1.2 million), Netflix grew subs in Q3, adding 2.4 million (up to 223 million), driven by APAC but with all regions back to an upward trajectory. The company's attempt to focus attention off subs and onto revenue hit a snag, though—due to F/X this was down quarter-on-quarter

Netflix's ad-supported tier will be launched in the UK on 3 November; while it will not alleviate churn it will increase the perceptual value of the more popular and expensive Standard tier. With BARB not measuring incremental reach and frequency of its commercial impacts, Netflix will still have a job to prove value to advertisers

The declaration of Netflix's UK revenue firms up our understanding of the company's paying base, and provides insight into the number of households that are getting the service for free—revealing the revenue potential of measures to counteract this freeloading culture, but also the prevalence of it

The new Truss/Hunt tandem is a needed response to the crisis affecting the credibility of the UK Government in global financial markets over its decisions on economic policy, although it will take time to re-establish credibility and stability

The cost-of-living crisis is inexorably widening from goods and services to the interest rates paid by Government, businesses, and households, exacerbating the recessionary trend of the economy

Implications for UK TMT range from the recession in advertising expenditure in2023, to the delay of the Media Bill (including the privatisation of Channel 4), alongside complications for mergers and acquisitions of UK companies

With major studios arguably over-indexed on SVOD, the stickier experiences of interactive entertainment and the metaverse will eventually form a critical pillar of studio D2C strategy, boosting subscription services and tying in closely with consumer products and theme parks.

Disney’s appointment of a Chief Metaverse Officer is good first step, demonstrating a strategic interest in the space. But other major studios remain cautious and distracted, with limited capability beyond licensing to engage in the metaverse for the next 24 months and possibly longer.

Meta will need to provide a strong guiding hand creatively and technically to ensure its new partnership with NBCUniversal is a success, and to evangelise the metaverse and its revenue model across the Hollywood studio content space.

Advertisers are rushing to create immersive virtual experiences to promote their brands, particularly on social gaming platforms with large built-in audiences. The interest shows no sign of waning.

We are in the very early days of metaverse marketing: formats are bespoke, costs are high and the data provided by platforms is rudimentary. Not all product categories are suited to a virtual incarnation.

The long-term promise is tantalising: advertising that is better than its real-world counterpart, that forges new relationships with customers, and that forms part of the product offering rather than just promotional activity.