Electricity and Telco Bundling – AGL and Southern Phone \ Programmatic OOH coming soon \ Webscale Playbook – Alibaba \ Australian broadcasters to launch ad buying platform



 



In this week’s edition, we look at the takeup of Broadband services if offered by an electricity provider (given AGL’s interest to acquire Southern Phone), programmatic advertising in OOH, our continuing series on webscale network operators (this week is Alibaba) and Australian broadcasters launching ad buying platform.

CHART OF THE WEEK

Take-up of Broadband services if offered by an Electricity provider in Australia – by age groups

Electricity and Telco Bundling – AGL and Southern Phone

With AGL’s recent announcement that it has entered into a conditional agreement to acquire Southern Phone Company, we have highlighted data from our recent Australian consumer energy survey showing strong interest from consumers to bundle broadband with their energy service.  Venture’s data shows that 27.4% of consumers would consider taking a broadband service and, for younger demographics, the potential take-up is 45.5%. Our previous reports have demonstrated strong service bundling in New Zealand from the likes of TrustPower and we have seen examples in Australia from RSPs such as Dodo and MVNOs such as Amaysim.  We expect to see more cross selling of energy, fixed broadband and mobile services. Contact us to learn more about our market surveys. 

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Programmatic OOH coming soon

Programmatic advertising in Australia (A$mn)



Source: ZENITH MEDIA FORECASTS

Programmatic advertising which accounts for about 50% of all digital display advertising in Australia, could boost growth in the OOH market by automating the buying and selling process of OOH inventory which is currently a manual process with multiple touch-points. Multiple OOH companies have started launching inventory trading platforms from which ad buyers can buy both first and third-party inventory. But, with each OOH player creating its own platform, there exists a need for a platform that can enable ad buys across the OOH market or risk the entry of a tech giant to fill the void. JCDecaux is planning to launch its new programmatic trading platform and invite its Australian competitors such as oOh!media to add inventory on the platform in an effort to bring the industry together to tackle the onslaught of the digital tech giants. For a more detailed look at how OOH players can benefit from programmatic advertising and the challenges and risks they face, click through to read our report.

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Webscale Playbook – Alibaba

FY2018 Business Revenue Split (MTN Consulting estimates*)



Source: Company Quarterly & Annual Reports; MTN Consulting analysis

Alibaba, once viewed as China’s answer to Amazon, has grown into a giant since its inception in 1999. Though still just about a fifth of Amazon’s size (by revenues), Alibaba has grown rapidly and outshines Amazon in some areas. Alibaba has invested heavily in network infrastructure to support its businesses, not just e-commerce but also cloud computing, audio/video streaming, and devices. As a result, Alibaba’s network-related demand has soared in the recent times. It now accounts for over 5% of global webscale network/IT capex, from about 1% in 2012. Alibaba’s network spend share will continue to grow, but will be reshaped by the ongoing US-China trade war. For a more detailed look at Alibaba’s performance and its disruptive impact on the network infrastructure market, click through to read a report from our US partner, MTN Consulting.

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Australian broadcasters to launch ad buying platform

TV advertising: by sub-segment (A$b)



Source: VENTURE INSIGHTS, ROY MORGAN, OZTAM

Nine Entertainment, Seven West Media, Network Ten, Foxtel and SBS have come together and committed to developing an ad buying platform that will enable advertisers to buy ad slots across all five TV operators. Due diligence has started to find a technical partner with a projected April 2021 launch. Traditional broadcasters have been battling a declining market for linear ad revenues and have been investing heavily in developing their BVOD offerings. This combined platform could provide a boost to the FTA adex market as a whole. For a more detailed look at the current state of FTA adex, click through to read our Australian Advertising Market Outlook.

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