Sky’s revenue was up 15% in Q2, back to pre-COVID levels despite some lingering pandemic effects such as most pubs and clubs remaining closed. EBITDA fell by a third, driven by higher costs from sports rights, since very few live sports events took place in Q2 2020

The impact of “resetting” football rights is already evident in Germany and Italy, with 248k net customer losses across the group despite growth in the UK. However, Sky will make substantial savings, and we expect this will more than offset lost revenues

Meanwhile, Sky continues to strike deals with other content providers, solidifying its position as the leading household entertainment gatekeeper. In time, apps for NBCU’s Peacock, ViacomCBS’ Paramount+, ITV Hub, and, in Germany, RTL TV Now and DAZN, will all be aggregated within Sky Q

VMO2’s inaugural results reinforced the company’s focus on profitability with EBITDA growth of 6% and record margins. Flat revenues year-on-year benefited from the annualisation of the COVID-19 hit but incorporated little by way of rebound.

Much remains to be seen in terms of strategy but indications thus far are reassuring with B2B a clear focus for revenue growth, and the benefits of direct distribution feeding through to profitability.

The company’s decision to build an overlay full fibre network is a bold, but smart, move—allaying justified obsolescence fears about its network, enhancing strategic flexibility, and reducing its cost base.

Post Brexit, Vodafone has followed EE's lead in reintroducing roaming fees for some mobile packages. We expect Virgin Media O2 and the MVNOs to follow suit, with H3G's approach more uncertain.

This move is somewhat inevitable as current arrangements leave operators exposed to up to €75 of monthly wholesale charges, and even more as legacy EU wholesale deals expire.

We don't envisage a return to the days of super-normal returns from roaming, but it is nonetheless conducive to much-needed price inflation in the sector.

• The three lockdowns since Q1 2020 shifted the sales of ‘non-essential’ stores (e.g. clothes) to online, with deconfinement releasing the oxygen of pent-up demand to the high street, eroding online’s share
• For vendors of ‘essential’ goods (e.g. food and drink), which stayed open, Work-From-Home (WFH) shifted a large portion of spend to in-home purchases, with both offline and online spend remaining elevated in Q2
• The share of online in retail sales (excluding fuels) dropped from its peak of 34.7% in Q1 2021, when the UK was in its third lockdown, to 27.6% in Q2. This is still up 10 ppts from 18.7% in Q2 2019, evidence of a new post-pandemic normal, as mobility to retail and recreation destinations remains impaired

Vodafone’s growth this quarter was a touch disappointing; the annualistion of the COVID hit was a clear boost but no evidence of any tailwinds. The 1.1% growth in the European markets should be the real focus for investors.

We see some evidence of positive initiatives from Vodafone such as its new EVO tariffs in the UK but it still has much to prove on operating momentum, especially in Germany.

There are signs that Vodafone is slow-pedalling in some markets and with demanding EBITDA targets and with leverage still finely balanced, we expect this focus on profitability to continue. The UK may be a special case.

With the O2/Virgin Media merger now approved, VodafoneZiggo in the Netherlands may hold clues to their likely approach to the market although their starting point is not quite the same and some lessons may have been learned.

We remain sceptical of the merits of discount-led convergence strategies. The pandemic, however, has eased the route to cross-selling and strengthened the case for convergent technologies.

Virgin Media’s network strategy will be key with significant risks from wholesaling their cable network and from expanding their footprint.

As we expected, UK mobile operators are beginning to introduce EU roaming tariffs, with EE taking the first major leap in the hope that others will follow.

This move is somewhat inevitable as current arrangements leave operators exposed to up to €75 of monthly wholesale charges.

We don't envisage a return to the days of super-normal returns from roaming, but it is nonetheless conducive to much-needed price inflation in the sector.

A channel dedicated to personality-led opinion breaks from TV’s strong range of rolling news, bulletins and standalone debate programmes. Conceptually GB News is more like talk radio: audiences can dip in at any time of day to hear takes on stories.

A linear launch—especially one based on a new interpretation of Ofcom’s due impartiality rules—has generated headlines, but the stark commercial reality of sustaining TV news by itself remains.

Its own linear audience and paying member forecasts are optimistic for a service with limited prominence and a streamlined budget, though profitability may not be its only measure of success.

Three lockdowns since March 2020 greatly reduced mobility in Greater London, an area with high reliance on public transport. Risk aversion even reduced mobility in cities like Seoul and Auckland that effectively contained the virus.

The concentration of air pollutants in the Greater London area dropped 50% below the 2019 baseline level in March 2020, remaining below baseline for much of the period since, despite increasing road vehicle traffic. The biggest rises in air quality occurred in wealthier boroughs like Richmond, a glaring inequality.

Another stark inequality of the pandemic is the much higher share of residents of wealthier boroughs than poorer ones able to stay at home, also saving more precious time by reduced trips to the workplace. These benefits are much less available to low-income, and disproportionately BAME, residents of London, often essential workers.

The last lockdown caused service revenues to dip again to -7% in spite of some easing of roaming pressure and the annualisation of some early pandemic weakness.

The heralded, elevated in-contract price rises will fail to drive higher growth this year due to lower inflation—we estimate zero impact at BT/EE relative to 2020 and a reduction in revenue momentum of around 0.5ppts for each of the other operators.

The annualisation of the first lockdown is the most meaningful upside from here with a boost of around 5-7ppts possible. However, some pandemic upsides will also unwind, notably lower churn and enhanced B2B demand with the latter vulnerable to the end of furlough support and the economy.