Scottish Media Group’s decision to sell its Virgin Radio business has been prompted by the need to pay down group debt and the management’s decision to refocus on the turnaround of its ITV service. This report outlines our views on the management pronouncements made on the success and performance of Virgin Radio and, therefore, its value to investors. We consider that management has exaggerated the potential value of this asset to investors
Warner Music Group reported a mild revenue decline in Q2 FY 2006/07, despite continued steep declines in CD sales in the US and elsewhere, by outperforming other CD suppliers, gaining from rising downloads and ringtone sales, persistent strength in music publishing, as well as favourable currency movements
The three most listened to radio stations in London all belong to the BBC, for the first time since commercial radio started in 1973
Steep drops in US and UK recorded music sales dragged EMI’s group revenue 15.8% lower for FY 2006/07. EMI’s underperformance of the sagging recorded music industry highlights the scale of the challenge facing any prospective new owner
Ofcom has awarded the UK’s second national commercial digital radio multiplex to Channel 4 Television, having rejected a competing bid from National Grid Wireless
Audio webcasting services such as Last.fm, bought in May by CBS for $280 million, have built sizable audiences by offering greater choice and personalisation than traditional radio
US music shoppers continue to shun the CD, whilst increasing digital music sales are not filling the gap – we estimate the market’s volume was down 10.3% in H1 2007 year-over-year, in keeping with our forecast of an 8% decline in 2007
The UK recorded music industry now has certainty on the royalty regime for online music services until 2009 as a result of the ruling issued last week by the UK Copyright Tribunal, with little impact on underlying business models
Apple revealed an updated iPod range to stimulate demand in the run up to the all important Christmas quarter, when iPod revenues typically account for 50% of Apple’s totals
Further consolidation could lie ahead for the UK commercial radio sector. EMAP is expected to offer its radio assets for sale and Scottish Media Group plans to divest Virgin Radio. The battleground is competition for listeners drawn by the BBC's increasingly popular national radio networks. This report however examines past consolidation, which produced substantial cost savings, without noticeably improving the commercial sector's fortunes. In our view, for consolidation to succeed in this regard, much greater attention will need to be paid to improving content