Enders News

Marketing Week 29 March 2017

Matti Littunen was quoted in an article on Google and the advertiser boycott that the company is facing. A growing number of global brands have pulled their advertising campaigns from YouTube over the past week after finding their ads had appeared next to extremist content. Google, which owns YouTube, has vowed to tackle the issue by working on toughening up its policies, making its advertiser controls easier to use, and hiring more staff to police content deemed unsafe by advertisers. However, as this illustrative chart* shows, at least some of the blame for such ad misplacement falls on the ad buyers themselves. As a result, Google is taking steps to mitigate the issue, and it already offers a premium service, ‘Google Preferred’, that allows advertisers to pay more to have their ads run alongside the most popular videos. According to our (Enders Analysis) report, this has a much higher guarantee of brand safety, but also costs more. Because most advertisers want cheap reach they buy via exchanges that have a much lower guarantee of brand safety. Matti says while the below* is “illustrative” is how the hierarchy of online video purchase channels when it comes to cost and exposure to brand risk. He explains: “the basic idea of ‘you get what you pay for’ in programmatic video advertising, either in media costs or agency planning and service fees (or both, depending on the type of media), is something we believe that many advertisers have yet to fully incorporate into their strategy for media buying.”

Financial Times 28 March 2017

Claire Enders was quoted in an article on the discarded plan to privatise Channel 4. However, the UK government has stepped up the pressure for Channel 4 to move part or all of its operations from London. Ministers have been considering whether to force the public service broadcaster to move to another major UK city, such as Birmingham or Leeds. Claire said “it’s a great relief that the government has realised that Channel 4 is sustainable long term and provides a valuable public service. With a licence to 2024 and soft advertising ahead, privatisation would have been difficult and very controversial.”

Broadcast 28 March 2017

Julian Aquilina was quoted in an article on the consumption of SVoD services which, according to his report, will double from a low base over the next decade - but live viewing is expected to prove resilient. In fact, in the “Video Viewing Forecasts to 2026” report, Julian predicts that the amount of live TV viewed per person per day fall will be just 10% from the current 173-minutes a day to 155-minutes in ten years’ time. Julian said “one might think that we are suddenly painting a future in which everyone will be glued to their smartphones as they go about their lives, but it is critical to bear in mind the reasons why we watch television in the first place, the fact is, people continue to enjoy TV content very much, and more high-quality programmes – especially scripted drama – are being produced than ever before.” He added that the linear schedule will continue to “retain a hold” over audiences, particularly for big events, live shows and sport.

Digiday 28 March 2017

Douglas McCabe was quoted in an article on The Spectator’s subscriptions strategy. This January, the magazine introduced new paywall software that gives more granular insight into what subscribers are reading so it can develop how it gets people to register for free and then convert to paying subscribers, as well as refine the experience for existing subscribers. Furthermore, The Spectator, who has been running podcasts for four years, is now planning to use its new subscriptions-management software Evalok to explore how to convert podcast listeners to paying subscribers of the magazine. Douglas said “we are now well past the idea that it is impossible to charge for content online”, and British weekly and fortnightly magazines are performing particularly well. He added “their mixture of news analysis, features and cultural commentary delivered weekly or fortnightly feels a potent counterweight to the always-on information tsunami from digital media”.

The Times 28 March 2017

Alice Enders was quoted in an article on Brexit and the consequences for British firms. In particular, Alice focused on TV and film producers, which could be among the big losers if Britain leaves the European Union without a free trade deal. The impact would reverberate far beyond the creative sphere. Overseas sales of movies and TV shows, along with other creative work, brought in £13.9bn in 2015, accounting for 9% of non-financial services exports that year. A large chunk of that income would be cast into doubt by a hard Brexit. Under the current system, European broadcasters are obliged to buy 50% of their programmes from EU-based producers. Alice said “the quota system has been very valuable to Britain’s TV production industry”. Adding that “exports are becoming more important due to pressures on the licence fee and the budgets of commercial free-to-air broadcasters.”

Financial Times 23 March 2017

Claire Enders was quoted in an article on François Fillon’s claim of being the victim of a “media lynching” and told reporters he had faced “a press campaign of unheard-of violence”. His criticism chimes with that of his chief opponent National Front leader Marine Le Pen, who also sees bias in the mainstream media’s coverage of her. Mr Fillon and Ms Le Pen’s combative tone reflects heightened tensions between France’s politicians and the country’s media, which have traditionally enjoyed a cosy, conciliatory and even incestuous relationship. Claire said “French politicians feel that the country’s press has become more demanding, journalists were more deferential before and they could be restrained. There was an established pact between the government and the media, which has broken down.”

Les Echos 23 March 2017

Caspar Stewart was quoted in an article on the BBC documentary “Planet Earth II”, which has demonstrated its leadership in this type of programming but now Netflix would like to compete. Caspar was quoted as saying "Planet Earth II probably broke BBC records for this type of program". Nevertheless, it is true that the British public media is one of the few that can afford to invest in this field. The shooting of "Planet Earth II" took over three years in 40 countries, and it is estimated that each episode cost about 4 million pounds, compared with 1 to 1.5 million usually for this type of program. Caspar added that "given this success, a purely private operator would almost certainly cover its costs with an advertising model within its own country and through selling the rights to broadcast internationally. But that would be quite risky and challenging for a broadcaster without decades of experience".

Reuters 22 March 2017

Matti Littunen was quoted in an article on ad-blocking tools, which has launched a prolonged debate in the advertising industry. In fact, a broad coalition of advertising trade groups, ad buyers and sellers from Western Europe and the United States have urged the industry to stop using annoying online marketing formats that have fuelled the rapid rise of ad-blockers. Matti said the ad formats identified by the coalition "have already been discouraged for years by these bodies and yet are still commonplace”. Facebook, the second largest advertising platform after Google, warned in 2015 that ad-blockers were crimping its revenue. It has responded by severely curtailing unpopular ad formats while implementing technology to make ads on its site tamper proof, by in effect blocking the ad-blockers. Still, Matti questions whether the measures go far enough. Adding that "some reasons for ad blocking are not addressed by this, most notably long load times (due to poorly optimized ad content or excessive server calls by third party tracking software) and the lack of easy consumer control over how their data is collected, profiled, and used for ad targeting online".

The Financial Times 20 March 2017

François Godard was quoted in an article on the rising tensions between Mediaset and Vivendi over the Vivendi’s deal to acquire 3.5 percent of the Italian group. Despite reports in Italy of a possible peace deal between the two parties, Vincent Bolloré, Vivendi’s chief executive, has accused the Italian group of providing “misleading” information during negotiations. Francois said that he would “not be surprised” if Mediaset had been “too optimistic about its assets”, when the Italian group struck its agreement with Vivendi last April. He added that “they could have said a lot of things. But on the other hand I do not think Bolloré is a person who believes everything he is told.”

the Guardian 20 March 2017

Tom Harrington was quoted in an article on the Channel 4 announcement regarding the new lineup of the Great British Bake Off. Noel Fielding and Sandi Toksvig, were announced as the replacements for hosts Mel Giedroyc and Sue Perkins. Tom said “Channel 4 has its remit that it has to fulfil: it needs to be distinctive, innovative, and focus on minority audiences. It’s supposed to distinguish itself from the BBC. But it also doesn’t want to change Bake Off. So you’ve got Toksvig who seems like the stereotypical BBC host, and you’ve got Fielding who is for that youthful demographic that they will be hoping to maintain.” He added “but it’s more than the sum of its parts, it’s more than just the hosts. The major talent is the casting of the contestants, having a good mix of them who work well together. When most of the hosts left, people made the joke that all Channel 4 had bought was a tent. But the tent is genius. There’s something about being in a tent, the colour palette, the way everything faces, that will all be familiar. That’s what Channel 4 bought.”

the Guardian 20 March 2017

Douglas McCabe was quoted in an article on sales of physical books in the UK, which are now outperforming digital titles as a result of changes to Amazon’s deal with publishers. Sales of physical books increased 4% last year while sales of eBook shrank by the same amount. Douglas reckons that e-readers will continue to fall out of favour but that older readers will remain fans, not least because of the appeal of being able to “make the font bigger”.

The Times 20 March 2017

Douglas McCabe was quoted in an article on George Osborne’s first tasks as editor of the London Evening Standard. Mr Osborne must find new ways of raising revenue, with cost-cutting expected later in the year. Douglas said that the paper’s profits were positive “compared to where they were a few years ago”, but the decline in print advertising was likely to result in a loss for the paper. He added, “you could argue that [Osborne’s] a man who has some experience of taking on a distressed set of accounts”.

Bloomberg 16 March 2017

Claire Enders was quoted in an article on Rupert Murdoch’s bid to buy the rest of Sky Plc. However, this morning Karen Bradley, Secretary of State for Culture, Media and Sport, issued a European Intervention notice concerning the bid. At the time of the previous takeover bid, six years ago, Ofcom raised concerns around the effect on media plurality, prompting News Corp. to offer to spin off Sky News into a separate, independent company. Claire said that such a spinoff remains a prospect this time around.

Financial Times 15 March 2017

Claire Enders was quoted in an article on the resignation of David Abraham as chief executive of Channel 4. David has run Channel 4 for seven years and is credited with restoring financial stability. Claire said financial stability was Mr Abrahams’ greatest achievement. She added “when David came in, Channel 4 was a busted flush, he has restored the company’s financial fortunes.”

Financial Times 10 March 2017

Tom Harrington was quoted in an article on Netflix, who seeks for a subscriber boost due to the increased competition with Amazon and Sky on local content. Tom said “in terms of original content, it does seem like Amazon is a more concerted effort than Netflix. In India, they’re doing eight separate programmes. They’re really looking to localise their content rather than what could be considered window dressing”.

Les Echos 7 March 2017

Gill Hind was quoted in an article on BT, which shows that sport remains the key part to pay-TV. The UK's historic telecommunications operator, which estimated its salvation from content purchases starting in 2013, will pay 1.2 billion pounds for the total exclusivity of Three seasons of the Champions League and Europa League, from summer 2018. This represents 394 million per season and 32% more than the previous three seasons, which BT had delighted for 897 million to Sky, its big competitor In pay television across the Channel. Gill said BT acquires "much more" football content than in the previous auction.

The New York Times 1 March 2017

Tom Harrington was quoted in an article on the global expansion of Netflix. The Orange deal, one of Netflix’s first international partnerships, is a case in point. The company’s partnerships with cable and cellphone operators worldwide give it almost instantaneous access to potential new users without having to spend a fortune on advertising and distribution deals in markets where its brand and content are often still relatively unknown. Tom said “Netflix wants to be exposed to as many people as it can”, adding that, “Telecom operators want to keep people inside their walls, so they are willing to let Netflix in”.

Digiday UK 1 March 2017

Matti Littunen was quoted in an article on Facebook Live, which is stagnating in the U.K. In January, pages run by media companies in the U.K., like BBC Sport, The Guardian, Daily Mail and Sky News, created 850 Facebook Live videos, according to SocialBakers data, a number that has remained flat for the last six months. Matti said “very few professional publishers did well on Live under the subsidies, apart from some TV networks and sports leagues for promotional content”.

Campaign 23 February 2017

James Barford was quoted in an article on O2's decision to renew the naming rights for The O2, the London entertainment arena, which reflects the importance of the partnership in maintaining customer loyalty in the mobile market. James said there was evidence that O2’s partnership with the arena and other music venues "does help with loyalty". He cited figures that show O2 is the market leader in the UK at reducing churn – the rate at which subscribers quit – and was "the strongest-growing mobile operator" last year.

Racounter 22 February 2017

Claire Enders was quoted in an article on the future of Media & Entertainment. Internet TV is beaming big-budget programming into UK homes as some viewers switch off from traditional broadcasters - Drama is turning into a crisis for traditional TV stations. Internet streaming services Netflix and Amazon Prime are pouring billions of dollars into creating original, high-quality drama and programming, far outstripping the budgets of established broadcasters. Meanwhile, subscribers to internet streaming services have rocketed in the UK. Netflix subscriber numbers rose to 6.1 million by the end of 2016 from 2.7 million in 2014. Amazon subscribers climbed to 2.5 million in 2016 from 1.5 million in 2014. Claire said “the peak of UK viewing was during the 2012 Olympics across every demographic. We are looking at five years of decline since that peak”. However, Claire plays down the idea that established TV stations will be killed off by internet viewing. “Over the last 35 years, everything that comes along finds it place. Very few things ever disappear, they become more efficient”.