Publications
Sector(s) |
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PSB SVOD The Public Service Broadcasters (PSBs) have been mulling a possible SVOD service, a decade after their ad-supported Project Kangaroo was blocked on competition grounds Even if a reboot between the BBC and ITV were this time to be approved, we do not think Kangaroo 2 can succeed as a significant SVOD entrant in its home turf of the UK, above all because it’s too late Other flaws in the offer are that it would be too small, non-premium, too old (archive), and too old (viewing profile), plus lacking sufficient financial resource to produce a pipeline of unique series
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Media, TV | 12 November 2018 |
BT Q2 2018-19 results - Beating expectations, guidance still looks (a little) conservative BT’s Q2 results were well ahead of both its full year guidance run-rate and financial market expectations, with revenue flat and EBITDA up 3% versus guidance and consensus at -2% for both metrics Operating metrics were more mixed, with broadband churn high and (our estimate of) net adds low, but fixed ARPU was solid, backed up by rapid adoption of BT Plus, fibre adoption re-accelerated and mobile was strong across all metrics While part of the outperformance was likely due to H1/H2 phasing, it also reflects fairly conservative expectations and a solid operating performance, and hence full year guidance still looks very beatable, with a positive outlook beyond this
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Media, Telecoms | 9 November 2018 |
BBC Drama: a loosening grip A string of big, bold hits like Bodyguard, Killing Eve and Little Drummer Girl has reinvigorated the perception of the BBC’s drama schedule, with massive ratings and a coveted place in the public conversation However, the lack of the broadcaster’s top dramas actually produced by BBC Studios—declining to just 4 of the top 25 in 2018—is cause for ongoing concern At a time when the BBC is attempting to bulk up the iPlayer and programme IP has become the bedrock broadcasting asset, the BBC could be better placed
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Media, Telecoms, TV, UK Media | 8 November 2018 |
Misplaced media spend in a booming identity economy: a brand opportunity Most UK consumer spending, and the vast majority of its growth, is in categories which reflect who we are and where we feel we belong: lifestyle signifiers, passions, and social activities. Communities are at the heart of this growing economy, but ad spend on media which visibly targets us as members of a group in a relevant context has on average lagged behind in these categories. Advertisers recognising the power of emotionally and culturally relevant context in media, sponsorships or events, are finding an opportunity for building brands for the identity economy. |
Media, Telecoms | 7 November 2018 |
Radio’s evolution towards a digital future Radio faces challenges from Spotify and other online audio propositions, while the radio “dial” is challenged by smart speakers and global tech. UK radio broadcasters have risen to the occasion through innovation New DAB stations have helped radio achieve record audiences and revenues. Combined digital listening is now over 50%, but FM remains the primary platform. The current mix of FM/AM and digital maintains radio’s relevance for the medium term The long-term future is digital—a wide-ranging sector review is required to determine how to support digital radio’s growth and the question of a future switchover
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Media, Public Policy, Technology, UK Media | 30 October 2018 |
PSB solidarity and collaboration The Public Service Broadcasters (PSBs) are in the process of sliding from TV dominance to middling contenders, in terms of content expenditure and significance to viewers There are calls from many sides that the PSBs need to collaborate in order to thrive, in an era when global debt-funded SVOD services are making all the running This note explores what can realistically be achieved by PSB collaboration; where partnerships work best; and the areas best avoided
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Media, Telecoms | 29 October 2018 |
US department stores, Amazon, and omnichannel fashion retail Amazon is finding women’s fashion, a missing piece of its household-centric model, a tougher nut to crack than downmarket apparel Higher-end US department stores are pushing back with an omnichannel model, emphasising long-term partnerships, a clever full-price/outlet model, and experiences which cross the online-offline divide In apparel, Amazon and big box retailers have already triumphed over lower-tier American department stores, and even prestigious fashion brands are finding it harder and harder to refuse cooperation with the giants
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Media, Mobile, Technology | 25 October 2018 |
Disney, Fox, Sky and Comcast: future relationships With Comcast’s acquisition of Sky confirmed and Disney’s acquisition of 21st Century Fox on the path to regulatory clearance, how will the relationships of the various parties evolve? Disney is betting on a standalone SVOD service in the US. However, its content deal with Sky in Europe is lucrative, and the performance of DisneyLife in the UK suggests its US strategy may not fit elsewhere Sky’s relationships with Disney and Fox are crucial to its business. A joint pursuit to maximise returns from IP and distribution in Europe would be economically efficient for both Comcast/Sky and Disney/Fox
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PDF Report, Media, TV, UK Media | 24 October 2018 |
Esports & broadcasters: No game for old players Drawn by its rapid growth and enviably youthful audience profile, incumbent broadcasters are paying increased attention to esports and its followers Viewership of esports on UK broadcasters’ linear channels is low, with consumption on their online platforms likely the same. The market’s fragmented nature and global audience, along with the dominance of Twitch—and to a lesser extent YouTube—makes this unlikely to change Broadcasters’ low-cost approach has primarily benefited competition organisers and games publishers. For broadcasters to create real revenues, massive upfront investment would be needed, with the risk of failure high
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Internet, Media, Technology, TV | 9 October 2018 |
Price is the object: the iPhone and its services With a carefully priced, strong line-up of iPhones, Apple will consolidate its main revenue line and core user base in the near term The latter feeds into a services business showing impressive growth, but which is also marked by missed opportunities and mounting negative consequences on the rest of the online ecosystem For media businesses, Apple’s impact is larger than ever, inevitably leading to new kinds of friction around commercial terms, App store policies and browser features
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Media, Technology, Telecoms | 2 October 2018 |
What Sky means for Comcast Comcast’s £30.6 billion acquisition of Sky brings to an end the long-running ownership battle since Disney agreed to tender Fox’s 39% stake to Comcast, also ending the Murdoch Family Trust’s interest in Sky Comcast’s US domestic cable and global NBCU media businesses complement Sky’s European operation. Sky’s telecoms business is likely to expand, while the TV side should benefit from NBCU’s global distribution might, with greater revenues generated by its original content Fox’s long-running battle with UK regulators over the public interest dimensions of the proposed Sky acquisition has also ended. Plurality of media is preserved by Comcast’s undertakings to support Sky News for 10 years
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Media, Telecoms, TV, UK Media | 28 September 2018 |
From promises to practice: AI in marketing at DMEXCO 2018 At DMEXCO, the top online advertising conference in continental Europe, a call for responsibility took centre stage rhetorically, but was hardly reflected on the conference floor In contrast, concrete, on-the market applications of AI in advertising were no longer a rarity, with businesses from ad tech to consultancies demonstrating case studies in campaign management, consumer segmentation and personalisation The industry is betting that the ePrivacy Regulation will be canned as policymakers fear Chinese and American dominance in AI, but the Chinese giants still had a confused marketing pitch at DMEXCO |
Media | 24 September 2018 |
European mobile in Q2 2018 - North-South gulf emerges and threatens to widen further European mobile service revenue growth was sharply lower this quarter dropping to -0.7% after two years in positive territory, owing to weakness in the southern(ish) European markets of France, Italy and Spain Iliad has strong momentum in Italy and we expect ARPU dilution to worsen into Q3, with the subscriber loss impact also growing. Any loss of traction for Iliad is likely to drive another round of price cuts We expect continued north/south divergence in Q3 with the anniversary of the European roaming cuts boosting the UK and Germany in particular whilst the outlook for Southern European operators remains challenging
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Media, Telecoms | 17 September 2018 |
Broadcast TV is growing very old, very quickly Linear TV is ageing, and the largest channels are ageing fastest. There is an ongoing double-whammy effect of a growing older population, and the loss of younger viewers to social media and SVOD services. The PSBs are suffering more than most, especially the BBC channels. 31% of the population is aged 55+, but over 60% of viewing to BBC1 and BBC2 is by those aged 55+. The trend can be halted, and even reversed to some degree. There is no inevitability to this ageing process, but it will take concerted efforts to fight it.
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Media, TV, UK Media | 13 September 2018 |
UK mobile market Q2 2018: Disappointment before dawn UK mobile market service revenue grew by 1.7% in Q2, up from 1.3% in the previous quarter, a disappointing result in the context of boosts from both IFRS 15 accounting and the annual price rises in the quarter O2 was the star performer this quarter, with its service revenue growth leaping ahead to claim the top spot. BT/EE’s service revenue growth declined on an underlying basis, with weak contract net adds over the last six months catching up with it, and H3G and Vodafone were slightly improved and steady respectively excluding some one-off effects Next quarter, the impact from the EU roaming cuts will annualise out, providing a substantial fillip to all operators. Ceteris paribus, this would put market growth in the vicinity of 4%, a figure not reached for years
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Media, Mobile, Telecoms, UK Media | 10 September 2018 |
Japan's recorded music market starts to stream Recorded music revenues in Japan are stuck in decline as physical sales sag, although 2017 marks the first year when streaming gained a foothold with 8 million subscribers. J-pop fans spend on 'experiences' with their idols including events, merchandise, CDs and DVDs, which streaming cannot replicate. Top native LINE MUSIC offers integration with a popular messaging app and bundling with mobile. Serving international repertoire, Apple Music claims more subscribers than Spotify in Japan, which is more localised, and has most users on the free tier. Amazon Prime Music is a looming constraint on the adoption of subscriptions.
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Media, Music and Radio | 6 September 2018 |
Commercial TV impact trends: better than viewing trends, worse than ideal There has been no shortage of attention paid to declining TV viewing over recent years, but much of it focuses on overall viewing time rather than advertising delivery This is to overlook the engine driving most of the UK’s television industry. Commercial impact delivery has held up well relative to overall viewing, and is strong for certain key demographics Nonetheless there are generational and behavioural changes afoot which are exerting downward pressures on impacts, especially for younger audiences. An archipelago of Love Islands is needed (Stranger Things have happened)
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Media, Telecoms | 30 August 2018 |
UK broadband, telephony and pay TV trends Q2 2018: Great volume, shame about the ARPU UK broadband subscriptions re-accelerated in Q2, bucking a three-year downward trend, but market revenue growth still fell as BT’s overlapping price increase dropped out and all of the operators continued to struggle to meaningfully grow ARPU Regular existing customer price increases and continued (but slowing) migration to high speed are being cancelled out by flat-to-down new customer pricing, and the frequent need to discount existing customers down to these levels to retain them High speed net adds disappointed despite Openreach’s price cut, with many consumers unwilling to pay even a modest price premium for extra speed, a sobering thought as aggressive full fibre network roll-outs are being considered
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Fixed Line, Media, Telecoms, UK Media | 28 August 2018 |
Audible, audiobooks and lessons from Amazon Audiobooks are growing fast, driven by smartphone adoption and better supply, as well as interest from people who don’t usually buy books, such as young men The sector is dominated by the presence of Audible, Amazon’s audiobook publisher/retailer, which has driven growth of audiobooks but put publishers under pressure. Its strategy is a lesson in Amazon’s approach to media Audio is an opportunity to sell to new customers, but publishers must acquire and use rights responsibly, and experiment while not letting the audio tail wag the print dog If you are not a subscriber but are interested in accessing this report, please contact info@endersanalysis.com
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Internet, Media, Technology, UK Media | 22 August 2018 |
Sky 2017/18 full year results: Winning the game of content Sky maintained strong revenue growth of 5% in 2017/18, with EBITDA and operating profit both bouncing back into strong positive territory after the UK Premier League rights hit of 2016/17 The UK grew revenue well and profits better; Italy performed well and should improve much further given the retreat of its principal competitor; Germany is more challenged, but extra content investment may aid sustained growth Sky is proving adept at managing content costs and revenue in a changing environment, with investment, cost control and monetisation all being put to effective use as the content type demands it
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Fixed Line, Media, Mobile, Non UK Media, TV, UK Media | 16 August 2018 |