Publications

Format: Dec 2017
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BSkyB Q3 2000 Results

In this report Chris Goodall carries out a brief analysis of Sky's results published today and compares them to our projections.

Our emphasis in this note is on ITV Digital. What are the options open to the two shareholders of ITV Digital, Carlton and Granada? How can they reduce the burden of supporting ITV Digital through the next few years? What is the likelihood (or otherwise) of substantial improvement in that company’s results, in particular break even in 2003?

  • Sky
Media, Telecoms 16 May 2001
Global Handset Market 2001

At the current CSFB tech conference in Barcelona Ericsson stated that the expected handset market for 2001 will now be at lower end of its previously stated range of 430-480m; both it & Nokia said the reason was cuts to handset subsidies in Europe. Whilst we are relieved that our early emphasis on the impact of changes in operator strategies on the handset market in Europe has been proved right, we are in the process of revising upwards our own forecast of 300-350 million units based on growth in China (this forecast and spreadsheet will shortly be available).

For the future, we expect data traffic to slow given strong signs of a plateau in demand among businesses and changing residential payment models. However, we forecast a gradual evolution towards profitable ISP business models based on unsubsidised pricing for all forms of access. Indeed, we expect overall pure Internet access revenues to continue to grow until the latter part of the decade. This is plainly contrary to all those who predicted access would be free for all and a loss-leader for other forms of revenue, such as online advertising, e-commerce commissions and eCRM (direct marketing).

 

 

Telecoms, Mobile 11 May 2001
May 2001 Survey Results from Oftel

Mobile Phone Users

Media 11 May 2001
Digital TV Update

We have published extensively on digital TV in the past 18 months, consistently casting doubt on the potential of TV-centric interactive platforms to (a) generate enough income for operators to repay hardware subsidies and (b) compete with the PC for home shopping activity (t-commerce).

We see a clear distinction between the relative success of Sky and the continued slow growth of ITVdigital and the real difficulties being experienced by cable operators. Sky is gaining business while the other operators are struggling to retain their share. This is the first of two notes. In the first (attached), Chris Goodall examines the financial prospects of Sky in advance of its results next week. Chris looks at what would be good or bad numbers for Sky's results in all the main categories, and suggests reasons for short-term optimism. In our next note, which will be sent out on Monday, I analyse ITVdigital and question whether anything can be done to improve its prospects. The launch of ITVsport does not help, with its huge programming budget and limited opportunities.

Media 8 May 2001
Pay-TV - When Will the Corner be Turned?

Chris Goodall has dissected the economics of the major pay-TV operators. He finds that if current trends continue, BSkyB, NTL and Telewest will not generate the cash to pay back their debt in the foreseeable future. In the case of the cable companies this leaves the debt holders exposed. Equity holders should be concerned about further dilution from future debt to equity conversion.

Media 5 May 2001
ITV Licence Renewals

This note considers the so-called 'digital dividend' in light of the recent ITV licence renewals.

The UK online population reached 17 million in February 2001, up around one-quarter on the year, on the strength of rising participation of women (to 44% of users) and of young people. We expect 4 million users to be added to the online population by February 2002, to reach 21 million, with growth at a lower rate than in 2000.

  • ITV
Media 15 April 2001
European B2C E-Commerce Update

This report updates our July 2000 report on European B2C e-commerce, with a special focus on the UK market.

We estimate that global net adds were 48m in Q2, down from 58m in Q1 2001. The total net adds so far this year of 106m is 53% of our full year forecast of 201m for these territories, which supports our forecast of 375 million units shipped given that net adds will likely continue to decline in Q3 followed by the seasonally strong Q4.

Media 9 April 2001
UK ISPs

The UK online market is among the most mature in Europe: while strong growth continued during 2000 (60% increase in home users), this was less dramatic than in Germany and France.

Fixed Line 5 April 2001
Microsoft .NET - The Oil Tanker Turns

Microsoft has never made much impact on the Internet. As a result, we still have a proliferation of standards and competing suppliers of the underlying technology, of which the most obvious is Java. Almost all the new generation of Internet access devices, such as phones, PDAs and TVs, all use underlying software that does not work well with Microsoft technology. Genuine interoperability is not yet available.

The key points we make are as follows:

Media 15 March 2001
Microsoft: Will the Giant Engulf the Mobile Phone Industry?

The purpose of this report is to look in more detail at the actual capital expenditures that 3G operators can be expected to make. We show that costs will be very much lower than expected. This is because most operators will be able to offer a good service to large numbers of customers by installing relatively few base stations. This is excellent news for operators, but infrastructure vendors such as Ericsson and Nokia will see much lower volumes of equipment orders than most analysts are projecting. The evidence for our conclusions is derived both from an analysis of actual 3G infrastructure orders and from an analysis of theoretical capacity.

Media, Telecoms 15 March 2001
Wireless - Current Ideas and Issues

We see European handset shipments down from 140-150 million in 2000 to 100 million in each of the next two years.

Telecoms 5 March 2001
Sonera Smart Trust

20 February 2001
The Digital Bomb?

By contrast, NTTDoCoMo is putting its money firmly behind mobile data. Its investment plans in Japan provide capacity for huge amounts of data transmission. Three years from now, NTTDoCoMo will have invested, it says, 1 trillion yen (10bn Euros, if our maths is correct) in obtaining 6 million 3G customers. This investment, it says, will be enough to handle over 15m subscribers and provide coverage of 97% of the population. The major services it mentions as needing 3G bandwidth are music downloads and 'image clipping'.

15 February 2001
Gambling and Gaming on TV

Oftel appears to believe that such an arrangement would be acceptable if it 'allowed the delivery of 3G services earlier and at lower prices' than would otherwise be the case. It notes that the 3G licences do not ‘a priori exclude infrastructure sharing’ and that some forms of sharing, e.g. masts, are positively encouraged.

5 February 2001
Wireless

15 January 2001
The Orange Prospectus

The Orange Prospectus

We have forecast that the increase in the number of users during the whole of 2001 will be as follows

  • Orange
10 January 2001
Broadband Update

Broadband update document.

9 January 2001
Iliad FY 2008 headline KPIs and 4th 3G licence bid

 

In Q4 2008 Iliad added 100,000 subscribers in a slowing French broadband market

A restructured 4th 3G licence call for tender is now expected in March, with a cost of €206 million for a 2x5MHz spectrum block, which Iliad is expected to bid for

We remain sceptical that Iliad will earn a return from this, with the 3G-only business model challenging even with a reduced licence cost and restricted network rollout

 

  • Iliad
Non-UK Telecoms, Fixed Line, Telecoms 13 February 1009
KPN fixed line recovery

 

KPN noticeably improved the performance of its domestic fixed line business in its full-year 2008 results, with revenues close to stabilising, and positive EBITDA growth of 1% indicating a turning point in the profitability of the Dutch division

Dutch broadband penetration is close to saturation, so KPN’s revenue growth potential will shift from broadband to adoption of next generation access services and subscriber upgrades to higher bandwidth and digital television

KPN, however, is taking a cautious path on NGA. FTTH deployment will depend on local conditions, notably availability of financing from landlords and municipalities, household density and average revenues. FTTC/VDSL is for areas where returns will be lower. ‘Mass market’ deployment will be decided in H2 2009 depending on consumer adoption

 

Non-UK Telecoms, Fixed Line, Telecoms 11 February 1009
YouTube and its MCNs: growth and variety

YouTube remains the dominant online video site globally, although competition for the viewer is growing from OTT video and other popular apps. Reach and consumption appear to be slowing in the US and the UK, but YouTube reports strong growth in global watch time as smartphone adoption proceeds

The number and variety of MCNs on YouTube continues to grow. Music video MCN Vevo has so far been the largest single presence on YouTube, but it is being overtaken by the combined Disney/Maker Studios MCN

In contrast to the aggregator MCNs with tens of thousands of channels, studio MCNs have much smaller network sizes and a higher share of owned channels. Their focus on content curation and creation has allowed some to build global audiences of repeat viewers, a unique strength and of significant appeal for advertisers

  • Google
Music and Radio, Internet, TV, Media

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