Telstra to offer gaming as a service \ Optus to focus on video streaming with 5G \ UK Champions League auction – BT’s cost-cutting opportunity \ £1bn in UK could provide a fillip to shared infrastructure model


 



In this week’s edition, we look at Telstra’s entry into gaming with Microsoft’s Xbox All Access, Optus’ 5G launch to focus on 4K video streaming, the upcoming Champions League sports rights auction and the UK government’s support for a shared infrastructure model in telco. 

CHART OF THE WEEK

Mobile is most popular gaming platform



Source: AV&CO. 2019 INTERNATIONAL GAMING SURVEY

Telstra to offer gaming as a service

Mobile gaming usage is increasing [Q. On average are you:]



Source: VENTURE INSIGHTS MOBILE CONSUMER SURVEY APRIL 2019

Telstra has announced a partnership with Microsoft that will see it become the exclusive partner for Microsoft’s Xbox All Access gaming package in Australia. Telstra customers can choose from a plan that bundles an Xbox One console with a subscription to Xbox Live Gold and Xbox Game Pass, starting at $27 a month over 24 months or a premium version at $38 a month that includes an Xbox One S console with 4K gaming. Telstra also plans to introduce a fixed broadband product next year that will prioritise gaming traffic and reduce latency specifically targeting the gaming subscriber segment. Telstra’s move into gaming is in-line with our view that gaming and in particular mobile gaming will emerge as a key use for 5G. Venture Insights’ consumer survey also revealed that gamers are more likely to pay a premium for 5G which augurs well for Telstra as it rolls out its 5G network. Click through to access a free report on the latest gaming market trends and how gaming will emerge as a key use case for 5G.

Click to read report

Optus to focus on video streaming with 5G



Optus officially announced its 5G launch this week with its 5G Home broadband service available for up to 138,000 homes in select areas. Optus expects to have more than 1,800 5G sites live in the next 12 months from about 290 sites that are currently active. Following the kick off its 2019/20 Premier League Season with the World’s first 5G Premier League Broadcast, Optus plans to focus on delivering the best 5G Video Streaming experience to customers by building its 5G network from the ground up optimised for streaming 4K video content. From June 2020 Optus will launch 4K Ultra HD Live Football content on Optus Sport with select games available to stream at 4K. Optus is also working closely with OTT Video content partners 7plus, Amazon Prime Video, Netflix, Fetch and Stan with others to follow to ensure that their 2020 4K Ultra HD Streaming Video content line-up is optimised for the Optus’ 5G network. Optus’ move is in-line with Venture Insights’ mobile consumer survey in 2018 which highlighted mobile video streaming as a key use for 5G – especially when marketed with the benefits of 5G with faster download speeds and lower latency. For a more detailed look at how mobile video streaming will play an important role in a 5G era, click through to read our report.

Click to read report

UK Champions League auction – BT’s cost-cutting opportunity

Champions League live UK broadcast rights costs (£m/season)



Source: COMPANY PRESS RELEASES, PRESS REPORTS

Champions League UK TV rights, at £394m/season, appear to have reached a ceiling, with costs on a per match basis now comparable to the more-desirable Premier League. In the imminent auction, current rightsholder BT is the clear frontrunner. Potential competitors appear reluctant: Sky Sports has thrived since losing the rights in 2015, and no other players can reasonably compete at this spend. This presents BT with a golden opportunity to rein in costs, with a view to moving BT Sport towards breakeven at an important time for the wider business, considering the financial pressure it is facing. For a more detailed look at how the upcoming Champions League auction could play out, click through to read what our UK research partner, Enders Analysis has to say.

Click to read report

£1bn in UK could provide a fillip to shared infrastructure model



UK’s Digital Secretary Nicky Morgan has announced that the UK Government is supportive of a £530mn proposal from UK MNOs for a Shared Rural Network with the potential for it to be matched by a £500mn investment from the Government. With MNOs facing increased network spend and still defining incremental 5G revenue opportunities, Venture Insights believes it is time to look again at network sharing models. In particular we believe a focus on regional RAN sharing and small cells may be targets for either joint venture or neutral host players – and highlight the NZ shared RAN model for rural connectivity. In Australia, Venture estimates that Government (States/Federal) and Industry spend at the end of round 6 of the blackspot program could be as high as $1.2bn. If Governments continue to heavily subsidise regional network coverage then, in addition to mast sharing, they should consider the customer benefits of active RAN infrastructure sharing and the use of train repeaters to maximise investment outcomes.  In addition, since these networks are capable of wireless and fixed wireless solutions, these network sharing models should also consider the role of NBN moving forwards. Click through for our take on the potential of shared infrastructure models in Australia.

Click to read report