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Latest Reports

Venture Insights reports inform and enable better decision making through independent, objective, and high quality insights, analysis and thought leadership across the media, digital and teleco industries in Australia and New Zealand and with global insight from our European partner, Enders.

  • New
    June 17, 2019

    UK mobile market Q1 2019 – Pressure to mount after mixed bag in [...]

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    The UK mobile market posted its slowest growth in more than two years this quarter; just 0.5% service revenue growth although net adds were strong and churn was down. ARPU is under considerable pressure thanks to regulation limiting out-of-bundle spend which will exacerbate as the year progresses. Several other negative developments look set to be layered on the pressures this quarter, including a step-up in competitive intensity as 5G launches –  with H3G’s pricing of unlimited data a sign of a resurgence in its aggression
  • New
    June 13, 2019

    O2 UK: holding its own in toughening conditions

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    After a period of significant outperformance, O2’s Q1 results reverted to sector average revenue growth with ARPU down by 3% and all of the growth coming from ‘other’ revenues. Regulation limiting out-of-bundle spending has been a significant drag which will continue to worsen. A more competitive market and a punishing regulatory outlook will make it very challenging to sustain 2018 growth trends as this year progresses
  • New
    June 12, 2019

    Monetising user-generated video

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    ­­­­Video sharing platforms, like YouTube, Facebook Watch and Twitch, are vying to attract creators with monetisation options such as branded content and user payments. Advertising income, already limited for many small and medium-sized creators, has been undermined by YouTube’s response to brand safety concerns. The new tools come with their own obstacles, but are necessary to keep platforms attractive to video creators.
  • New
    June 11, 2019

    Mobile Blackspot Programs: Telstra likely to be the future winner [...]

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    The Commonwealth Government and States have funded four rounds of blackspots resulting in 1,047 new base stations. In March 2019, the Government announced two more blackspots rounds with total federal government funding of $160 million. Similar to the previous rounds, we expect the majority of total state and federal funding to go to Telstra. However, there are still bidding concerns for the rounds.  
  • June 6, 2019

    Foxtel and OTT – a tough balancing act…

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    Foxtel has made several attempts at building a successful OTT service, but the results have been mixed so far. With Kayo and the potential launch of a ‘Netflix’ competitor, Foxtel is clearly aiming to increase household penetration beyond the 30% mark. However, in a crowded SVOD market and the potential for further disruption from new entrants and other players, Foxtel faces a tough battle.
  • June 5, 2019

    UK HFSS advertising ban consultation

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    The UK government is now consulting on a wider TV advertising ban until 9pm for food and drink high in fat, salt and sugar (HFSS), to combat childhood obesity. TV and TV advertising are not the cause of children being overweight or obese (O+O). Policy change in this area should inform and educate parents and young children, as they have in Leeds and Amsterdam. With 64% of the UK population being O+O, obesity is a complex societal issue requiring a multifaceted approach. The evidence from existing rules, and plummeting TV viewing amongst children, says that further restrictions on TV advertising will be ineffective in curbing the rise of obesity in the UK.
  • June 3, 2019

    TalkTalk UK: a welcome slowdown?

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    TalkTalk hit the bottom end of its (revised) 2018/19 EBITDA guidance, an achievement given fierce price competition and the margin-dilutive effect of high speed upgrades. This is however helped by one-off Openreach price cuts, and price rises for ancillary products (voice calls and pay-TV) and out-of-contract customers that look hard to sustain. Subscriber growth slowed dramatically in Q4, and continuing this more measured approach could help the company counter multiple market pressures, and perhaps even lead to a détente in the current price wars
  • May 29, 2019

    Facebook’s video strategy – loads of content but nothing to W [...]

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    By 2020, online video will account for 82% of all internet traffic in Australia. It is therefore not surprising that global tech giants are investing in and acquiring different genres of video content as they make a play to dominate online video consumption. Facebook’s half-hearted attempt at video streaming has had its fair share of issues so far and is playing catch up in a market already dominated by other SVOD players.
  • May 29, 2019

    Vodafone – pressure is still on

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    Vodafone’s operating performance worsened again this quarter with revenues down 3.3% and an extension of its underperformance relative to peers. Vodafone was right to cut its dividend given the extremity of the cash constraint. With financials in Euro terms in negative territory and worsening, an elevated and progressive dividend was not sustainable. In spite of difficult market conditions, the lower end of guidance looks achievable as comparables will become easier and football rights costs decline. The transformation programme will need to pay off fast to deliver any meaningful growth
  • May 28, 2019

    Virgin Media UK: contemplating its strategic future as pressure m [...]

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    Q1 results evidenced the downturn that Virgin Media had flagged in February. Consumer cable weakened sharply to just 1% growth vs 3%+ historically, partly thanks to ‘increased promotions in response to market dynamics’. Monetising Virgin’s speed advantage is becoming more challenging. Competition is hotting up for high-speed broadband in particular, fuelled by Openreach targets for smaller players and BT’s full fibre and G.fast rollouts. The company faces two vital strategic decisions – whether to wholesale BT’s fibre products outside its footprint, and whether to allow wholesale access to its own network. The former is likely to have the most legs and offers an alternative to further Lightning extension
  • May 27, 2019

    BT UK: Promising future, but investment required

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    BT is accelerating its ‘full fibre’ rollout, likely due to a combination of a successful build to date, very promising regulatory developments, and (let’s not deny it) worrying competitor build plans. Full year results were a little weak versus consensus, with guidance a little soft as well, leading to questions of how this can be funded, particularly the roll-out acceleration from 2021/22 to cover half the country by the mid-2020. Whatever the funding mechanism, we regard the investment as sound, with BT’s planned operational transformation also promising but potentially requiring further upfront investment
  • May 23, 2019

    Monthly Australian TMT Wrap: April 2019

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    We have seen an uptick in M&A activity in April on the back of a relatively quiet period in March. Strong deal activity has been distributed throughout the telecommunications, media and technology industries.
  • May 22, 2019

    ‘Is Orange the new Bank?’ Telcos and Fintech

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    As OTT services grow in value, telco revenues are moderating and the lack of growth opportunities in the core business is driving telcos to look at adjacencies. Fintech is disrupting traditional financial services and offers a high value adjacency for telcos to play in where they can maximise their natural strengths.
  • May 20, 2019

    Disney gets the final piece of Hulu

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    Disney announced that it would acquire Comcast’s 33% share of Hulu in a put/call agreement that can be enacted by either party from January 2024, while taking full operational control of the vehicle immediately. Under the agreement Disney will pay Comcast a minimum of $9 billion for its current stake, provided Comcast fulfils agreed capital calls, which going forward would be just over $500 million/year. Disney secured the continued licensing of NBCUniversal content for Hulu, contributing about 30% of Hulu’s library, but Comcast can loosen obligations to Hulu for the launch of its own SVOD service in 2020.
  • May 16, 2019

    Australian Fintech Breakfast Roundtable: Fintech ready to disrupt [...]

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    On May 14th 2019 Venture Insights hosted a Fintech Breakfast with a number of prominent members of the Australian fintech community. The breakfast centred on Venture Insights’ latest Fintech consumer survey which analysed the attitude of Australians to the incumbents and the challengers.
  • May 15, 2019

    An alternative model to the proposed TPG-Vodafone merger

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    The ACCC has blocked the $15bn merger between TPG and Vodafone, citing its belief that a merged entity would reduce competition given TPG’s ability to become a fourth mobile operator. TPG and Vodafone intend to appeal the decision and have extended their merger agreement to 31 August 2020. Venture Insights believes there is an alternative model which would enable infrastructure efficiencies and benefit competition.
  • May 14, 2019

    Facebook doubles down on advertising

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    After the most challenging period in its history since 2012, Facebook has been able to stabilise its fundamental metrics and announce a major product overhaul. Despite talk of a business model pivot, Facebook’s focus remains on advertising, whose growth will remain concentrated in developed markets. News publishers wishing to stay relevant on the upgraded product set need to target exclusive layers of social interaction, with groups particularly important.
  • May 13, 2019

    Sky UK Q1 2019 results: weak ARPU hits bottom line

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    Sky made a surprisingly weak start to 2019, with revenue growth decelerating to 1.9% (the first time below 4% since the European businesses merged in 2015), due to weaker ARPU trends. However, Sky expects improvement to follow, blaming one-off factors in the quarter. The ARPU weakness drove EBITDA down 11.3%, but this should bounce back across the rest of 2019 as football rights costs turn from a drag to a positive. Comcast highlighted collaborations with Sky across tech, advertising, content distribution and even news, stating it is on track to achieve the anticipated $500 million in annual synergies over the next couple of years
  • May 7, 2019

    Sports streaming and 5G – everyone wants in…

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    Live sport remains an important content genre with the ability to attract consumer eyeballs and improve customer loyalty for both telcos and TV operators. However, TV operators (FTA and Pay TV) which until recently were the undisputed leaders in providing sports content, are being disrupted by sports streaming apps and telcos.
  • May 6, 2019

    UK Online media monetisation

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    The commercial challenges for media online are well-documented: online advertising pays for utilities such as search and social networking many times over, but not for media beyond user-generated content and low-investment journalism. There are also costs from a user perspective: wasted time, harmful content created to attract views, and the collection, sale, use and frequent leakage to criminals of personal data. Different sectors have found varying success with alternatives: games, video and music are attracting user payments, driving the paid online economy up 15.5% to £8.2 billion in 2018.