From the depths of 2023, advertising expenditure on legacy media rose moderately in 2024, on the back of an uptick in real private consumer expenditure thanks to lower inflation and reduced costs of credit—the outlook for legacy media is about the same for 2025.
Online stands apart from legacy media due to the growth of ecommerce—driven by both goods (over 26% of retail sales) and services such as travel, as well as intense competition among platforms (Amazon, Shein, Temu)—with double-digit growth in 2024 set to continue in 2025.
Television remains the most effective medium for brand advertisers—despite the decline in viewing—with broadcasters’ digital innovation and SVOD ad tiers providing greater targeting alongside the mass broadcast reach.
Service revenue growth dropped further to -1.7% this quarter as pricing remains under pressure and in-contract price increases no longer benefit
Competition is heating up in Germany and France, and Digi is taking an aggressive stance as it enters the Portuguese and Belgian markets
While there is increasing awareness that investment levels in Europe are compromised by the current market structure, support for in-market consolidation remains lukewarm at best at the EU level
Apple is investing an additional $1.5 billion into its satellite partner Globalstar to build a new satellite network and expand its direct-to-device text and call capabilities, setting Apple up to take a sizeable piece of this emerging market
The FCC has approved Starlink's direct-to-device service, opening the path to an imminent commercial launch in the US and elsewhere, though it deferred on controversial power and interference questions
In the UK, while Ofcom will potentially approve services in the second half of 2025, we continue to expect no commercial services apart from Apple to be launched before 2026, with the UK market an imperfect fit for direct-to-device for now
The German football league will earn 2% more per season from its broadcasting rights for 2025-29, while European peers have faced declines at recent auctions
Sky and DAZN have maintained their relative value to fans: Sky expanded its coverage by 27 games, but lost the Saturday ‘Live-Konferenz’ feed to DAZN
The league has maintained wide free TV exposure, and leveraged strong fan demand for its second division
Sky UK and Warner Bros. Discovery have reached a deal for the pay-TV platform to carry WBD's Max, non-exclusively, when it launches in early 2026. The ad-supported version will be bundled at no extra charge for Sky and Now subscribers
The non-exclusive nature of the deal appears to have invigorated Sky into a restructuring of its packages, essentially unbundling Sky Atlantic for the first time
The CMA has approved the merger of Vodafone and H3G, paving the way for the UK’s largest mobile network operator.
Remedies are in place to ensure pricing stability in the short term, with the increase in sector capacity keeping the pricing side of the equation in check over the longer term, together with network quality upsides for users.
This is the right outcome in our view, with the alternative of a slow, painful retreat by H3G much less desirable for the industry. BT/EE will face the greatest challenges in adapting to the new market structure, with upward pressure on capex spend for all network operators.
The proposal from DCMS to expand the pre-digital “public interest” regime that requires clearance for changes in the equity stakes in print newspapers to online news publishers lacks a firm rationale in 2024.
A plethora of online sources dilute the influence of news brands and their proprietors over British people’s political views, in particular the platforms (X, YouTube, TikTok and Facebook) hosting self-publishing influencers, politicians and political advertising.
The UK's expanded future regime, if enacted, will further chill the appetite of investors for stakes in commercial media, reduce their value and ability to raise capital, and stifle beneficial consolidation.
Broadcasters have made considerable progress in becoming platform agnostic over the past three years, delivering innovative ad propositions offering greater targeting, flexibility and measurement.
They would welcome the opportunity to work with advertisers to explain the complexity involved in delivering linear and digital campaigns.
Broadcasters believe that although TV advertising is transitioning to digital, legacy share deals and reliance on pricing relative to ITV1’s station average price (SAP) continue to hold the market back. Potential amendments to CRR may allow for a smoother digital transition, benefitting the entire ecosystem.
Canal+ is listing in London amid earnings and revenue growth and having shown a capacity to partner with global streamers in its core markets.
Investment in local 'tentpole' content—films, series and sports—ensures Canal+’s appeal to consumers and attractiveness to aggregation partners.
Significant growth and synergy opportunities lie in the turnaround of MultiChoice (in Africa), Viaplay (in Scandinavia) and Viu (in South-East Asia).
Market revenue dipped into marginal decline in Q3, as both ARPU and sub growth weakened, both partly driven by the continued altnet onslaught
Backbook pricing effects will be of marginal help in the short term, but new customer pricing competition is still fierce, and households are still cash-strapped
In the longer term, pressure from the altnets should wane substantially as their roll-outs slow and they consolidate towards a wholesale model (or fail)