Q3 2014 saw adjusted revenues up by 7% across the first nine months of fiscal 2014, helping to offset the large cost increases due to the new Premier League contract and investment in accelerating take-up and usage of connected services

In line with strengthening the online offer, retail subscription revenues were well up in the quarter, which saw further strong growth in NOW TV and Sky Go Extra subscriptions, while bad weather and losses due to the final integration of O2 customers temporarily subdued broadband growth

Continuing expansion of the total paid for multi-product subscription base and launch of new transactional and adjacent revenue streams appear the key drivers of future revenue and profit growth, while the next and looming Premier League auction remains the joker in the pack

Northern & Shell has concluded the sale of the Channel 5 Group for the price of £450 million, a little over midway between the £103 million spent on acquiring Channel 5 from RTL in 2010 and the quoted target price of £700 million at the beginning of the year

Channel 5’s fourth place in the strong and buoyant UK advertising market, its PSB privileges and current audience and operating performance make it a rare and attractive opportunity for US groups like Viacom seeking to expand their international footprint

Among the challenges facing Viacom are the integration of the free-to-air Channel 5 Group reaching a broad audience with its own largely pay-TV channels aimed at the younger age groups. In the process, we expect Viacom to deepen its ties with Sky, including advertising sales, where further consolidation appears likely

Facebook has successfully transitioned its business to mobile, with the number of mobile users now exceeding those on PC, and mobile newsfeed ads accounting for nearly all revenue growth and over half of total revenue, now on a $10 billion annual run-rate

North America and Europe continue to account for the vast majority of revenue and revenue growth, despite flat audience penetration in both regions, as increasing mobile consumption and advertiser take-up have driven sharp increases in ARPU, particularly in the US

Despite tougher comparables and declining desktop revenue going forward, the rapid ramp up in mobile ad revenue, plus initiatives such as video ads, ads on Instagram and planned mobile ad network, should deliver strong growth through 2014 and into 2015

The boom in mobile device sales accelerated in 2013, with more than four times as many smartphones and tablets as PCs shipped in the UK: smartphones accounted for three quarters of mobile phone sales, and shipments of tablets surpassed PC sales, which fell sharply

By 2020, we forecast that smartphone penetration will rise from two thirds of the population to over 80%, and the number of tablet users will exceed 60%, outstripping the PC internet audience, which we expect to shrink. We now predict that the majority of internet usage will go to mobile devices this year and three quarters by 2020

Mobile is well on its way to becoming the predominant access platform in the UK, as in the US, and most, if not all, future growth in commercial internet revenues will be driven by mobile devices

Netflix is making steady progress with the global expansion of its streaming business, which now makes up 20% of total revenues, but is still far short of its long term vision of 70-80% share

Building a large presence in Europe is vital to long term success. The signs are that Netflix is steadily growing its UK and Ireland base, and performing even more strongly in the Nordics and possibly also in the Netherlands

We are reaching the most critical point of Netflix’s European journey, as it contemplates entry into the key markets of France and Germany. Germany looks the more obvious first choice, with rumours of a September launch, but ideally Netflix will want an autumn launch in France too, if it can handle the extra strain on budgets

US recorded music retail sales fell 5% in 2013 to $5.5 billion on a bruising 17% decline in physical sales and a sharp slow-down in digital growth

DTO retail sales slipped for the first time in 2013, a trend that continued in Q1 2014. On a brighter note, the leap from 3.4 to 6.1 million subscribers makes the US the top market for the format

At the wholesale level, the fall in revenues from B2C sales was entirely offset by the rise in B2B revenues from ad-supported music where usage is booming – in 2013, B2B contributed 16% of wholesale revenues of $4.5 billion

The ongoing digital migration and the resulting audience fragmentation have led to rating losses at RTL and ProSieben, but with the latter retaining its younger viewers. From a low base global operators are gaining share

Leveraging their high market shares within a benign economic environment means RTL and ProSieben are in a position to withstand the increasing competition. ProSieben has been more active in developing diversification businesses – on which we have mixed feelings

The main extra growth prospects are in the distribution fees charged to TV platforms for HD channels, allowing a progressive shift to a mixed funding model

As we expected, Canal+ won the broadcast rights to the Ligue 1 top three weekly games in 2016-20 and beIN Sports have the seven remaining fixtures Sensibly, the two competitors avoided a bidding war but ended up paying 28% more than the 2012-16 agreement – the first substantial increase since 2005 The new contract will help Canal+ sustain pricing and marketing. Meanwhile, even if it completely lost the ongoing Champions’ League auction, Canal+’s football prominence would remain

Amazon has entered the increasingly crowded digital entertainment TV device marketplace, one which could be strategically more important for the ecommerce giant than tech rivals Apple and Google

The frictionless integration of entertainment and ecommerce on TV represents a bigger consumer milestone than competitor services are offering, and Amazon’s brand has huge appeal, though at present it has less market traction for streaming than it does for other products

Content owners and broadcasters remain the real TV gatekeepers, with integration of TV and digital a service-level pipe dream for now, and so Amazon will likely have to accept being one of many, rather than the runaway winner as it is in books

The core US long form streaming subscription business, so vital to Netflix prospects of long term global as well as domestic success as competition increases, shows no sign of slowing, while guidance points to Q1 2014 as another strong quarter Although market research indicates a positive brand image, boosted by Netflix’s entry into original content commissions, Netflix cannot afford to slacken in its efforts to build its subscriber base due to strong upward competitive pressures on content obligations Content delivery is the other big cost challenge. There is no guarantee that the recent deal with Comcast will last, as the leading ISPs contend with conflicts of interest that arise from wishing to support the traditional model of linear TV but also to exploit the potential of long form online video