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  • September 19, 2019

    Use cases for AI in Telco: An era of mainstream adoption

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    Many tier 1 telcos have begun to implement AI initiatives to build and operate their network, sell more efficiently and improve the customer support experience. Based on our industry interviews, we expect increasing competitive intensity in the telco market to drive increased adoption of AI beyond the largest incumbents and into RSPs
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  • 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
  • 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.
  • April 8, 2019

    The North heads south: European mobile in Q4 2018

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    European mobile service revenue growth dropped to -1.3% – its lowest level in three years – particularly disappointing as growth should be bouncing back post-EU roaming tariff cuts. Having enjoyed relatively favourable dynamics in 2018, the UK and Germany are facing marked changes in momentum from here. Regulation limiting intra-EU call prices could hit hard – up to 6% of revenues and 20% of EBITDA in the UK, although other EU countries may be less exposed due to lower tariffs currently.
  • March 4, 2019

    MWC – all very exciting but where’s the money?

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    ­­­­The combination of 5G, AI, IoT and big data were evangelised at MWC as generating massive scope for the transformation of multiple industries. That much is probably true, but it is the tech and consultancy companies who will likely receive the benefits, with connectivity revenue likely to be modest. For the operators, 5G brings more capacity much needed for hungry smartphone users, and perhaps the opportunity to transform themselves into a leaner operating model.
  • December 3, 2018

    O2 UK: scope for outperformance near-term, solid results thereaft [...]

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    O2 has managed to deliver a solid financial performance over the past several quarters in spite of network constraints which are now resolved. With signs that they are becoming more assertive in the market, and with continued brand strength and low churn, there is scope for that performance to hasten from here. Over the medium to long term, turnaround plans from the other MNOs could thwart outperformance by O2 but with an holistic culture of leading-edge marketing and innovation, we expect at least sustained solid results.
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  • September 17, 2018

    UK Broadcast TV is growing very old, very quickly

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    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.
  • September 11, 2018

    UK mobile market Q2 2018: Disappointment before dawn

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    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.
  • June 20, 2018

    European mobile in Q1 2018: North–South divide to exacerbate

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    In this report we show our analysis of revenue growth trends for mobile operators in the top five European markets (UK, Germany, France, Italy and Spain). The historical analysis is based on the published results of the operators, although they include our estimates where their data is inconsistent or incomplete, and we have updated previous period figures where better information has come to light. A copy of the underlying data in spreadsheet format is available to our subscription clients on request.
  • TV platform forecasts to 2026: DTT and pay-lite set to grow
    TV platform forecasts to 2026: DTT and pay-lite set to grow
    June 6, 2018

    Football embraces Chinese ‘hot’ money – at a risk

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    In a display of chutzpah, Mediapro acquired the Ligue 1 domestic broadcasting rights from 2020-24 in what is the most disruptive shock to the French broadcasting industry in a generation; one that is likely to accelerate Canal+’s decline, force a review of the outdated regulatory framework, and possibly spur an M&A spree. The Mediapro move only makes sense as a highly speculative bid to resell the rights, or a dedicated channel, to French platforms in 2020. The odds are high that the broker ultimately fails to fulfil the contract, as just happened in Italy, where Sky is now expected to get the Serie A licence. Precedents of new entrants acquiring domestic top-flight rights bode poorly for Mediapro, and for the league. The Ligue 1 may live to regret the introduction of a ‘re-sell right’ into its licensing terms.  
  • May 31, 2018

    French, Spanish and Italian telcos won’t bankroll further footb [...]

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    The rights auction for France’s Ligue 1 will be held on 29 May. With Altice’s struggling subsidiary SFR unlikely to bid, Canal+ and BeIN Sports may not offer enough to meet reserve prices, triggering a postponement of the auction. In Spain, stiff fixed-line competition is shifting battlegrounds from football to scripted content. The Champions League has yet to sign up a platform for next season, while the upcoming 2019-22 La Liga rights auction may well fail to increase domestic revenues. With just 12 weeks before next season kicks off, Italy’s Serie A is also yet to secure a broadcaster, although we expect the league to back down and settle with Sky. In this deflationary environment, top clubs are eyeing a new Club Word Cup as an extra revenue stream – running the risk of further widening the financial chasm between themselves and smaller clubs.    
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  • May 24, 2018

    European video-on-demand: Playing catch-up to the UK

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    The UK continues to lead the EU5 in take-up and consumption of video-on-demand services, with close cultural alignment and a historic williness to pay for TV content making it a receptive home for US SVODs. Netflix dominates in most markets, benefiting from high-profile US imports and big-budget local productions. Local SVODs are struggling, with those operated by FTA broadcasters facing considerable challenges. Collaboration between local broadcasters and pay-TV platforms is essential if they are to hold at bay the threat of Netflix and co., with an increasingly favourable regulatory environment opening the door for unprecedented collaboration.      
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  • May 15, 2018

    Covert growth in UK mobile

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    The UK mobile market is growing strongly – we estimate revenues by 5% and EBITDA by 8% in 2017 – excluding one-off regulatory drags and the loss of non-profit-generating handset revenue. Regulatory price cuts end in mid-2018, and the handset effect will disappear from all reported figures from April 2018, leaving scope for very positive headline growth next year – considerably better than its European comparators and the sluggish UK fixed market. The outlook for the UK mobile industry is the best it has been in a decade, with significant growth in data demand, price increases, some supply constraints, rational competition, and major regulatory drags rapidly fading.          
  • April 18, 2018

    Sky’s Italian strategic breakthrough

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    After losing money for 13 years fighting Sky, Mediaset has given up. The two have agreed to wholesale channels to each other, and Sky gained the option to take over the infrastructure of terrestrial pay platform Mediaset Premium, in a deal designed to pass antitrust muster. The main strategic upside for Sky resides in eventual access to content from Italian FTA channels, allowing it to become the country’s ‘universal’ platform. Meanwhile, Mediaset may find it easier to resolve its dispute with France’s Vivendi now that the broadcaster has got rid of its main cash drain. Sky remains the only major potential buyer of the 2018-21 Serie A rights, to be sold on 21 April. However, due to the league’s unrealistic expectations and the faulty platform-based auction design, the auction may be aborted for a third time, raising the risk that heavily indebted clubs resort to short-term fixes.
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  • UK mobile market Q4 2016 – Nearly back to growth
    UK mobile market Q4 2016 – Nearly back to growth
    December 18, 2017

    European mobile in Q3 2017: Still growing (just)

    European mobile service revenue growth declined this quarter to 0.3%, likely due in large part to the increased negative impact from the European roaming surcharge cuts, which we estimate at around 0.5-1.0ppts for Europe as a whole. The continued growth was supported by continued ‘more-for-more’ price increases coupled with strong data volume growth. Partially countering this, there has been a step up in competition at the low end in some markets, often driven by the smaller operators. Looking forward, the negative EU roaming impact is likely to decline from next quarter given the end of the summer holiday season, and on balance we would expect positive price increase trends to overcome negative low end competitive trends, at least in the short term. This might change in 2018, as Iliad launches in Italy, and recently consolidated operators become more of a threat.    
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  • TV platform forecasts to 2026: DTT and pay-lite set to grow
    TV platform forecasts to 2026: DTT and pay-lite set to grow
    July 26, 2017

    European subscription and pay-TV monitor

    Across Europe, markets are becoming more competitive. Incumbent pay-TV paltforms (e.g. Sky or Canal+) face increasing threats from both internet-based services (e.g. Netflix and Amazon), and telecoms operators.Telecoms providers are proving the most potent challengers as they enter the premium football rights market to create attractive triple and quad play bundles – examples include BT, SFR and Telefónica. The latter is now the main pay-TV operator in Spain whereas France’s Canal+ has entered into a strategic alliance with Orange. Across the top five markets (UK, France, Germany, Spain, and Italy), Sky remains the leading operator with an estimated 21.5m video subscribers, twice as many as Netflix
  • European scripted content - Rising demand and consolidation
    European scripted content - Rising demand and consolidation
    July 11, 2017

    European scripted content

    The US scripted content boom is spilling over into Europe: Free-to-air TV drama ratings have proven resilient but as costs and audience expectations have risen budgets are under pressure, necessitating flexible co-financing arrangements with American broadcasters, and Netflix and Amazon. Pay channels have boosted output—with uneven results. Long-term IP control is a key factor behind independent production consolidation, led by broadcasters seeking a secure stream of content and diversification away from advertising. Notable developments include the new wave of Berlin-based, internationally-financed series, the rise of domestic French content and Sky Italia’s edgy originals, Telefónica’s giant leap into Spanish dramas, and the continuation of Britain as an export powerhouse.

  • June 29, 2017

    European mobile in Q1 2017: Stuck at zero

    European mobile service revenue growth remained stuck at zero in Q1, with a heightened impact from the mobile termination rate cuts in Germany and price promotional activity in southern Europe mitigating improving markets in the UK and France.‘More-for-more’ price rises continued both during the quarter and after, and appear to be more widespread than the 2016 increases. This should be driving revenue growth at a healthier rate than zero, and may well do as out-of-bundle revenue declines fade away in significance and regulated MTR and roaming cuts annualise out. The regulatory impact should improve next quarter, as the UK MTR impact drops, Germany at least gets no worse, and the roaming impact has a lull prior to the ‘free roaming’ mandate taking effect towards the end of the quarter. From Q3, however, the ‘free roaming’ effect will be in full force, and will negatively impact operators in northern European and smaller European countries in particular

  • European mobile in Q4 2016
    European mobile in Q4 2016
    April 19, 2017

    European mobile in Q4 2016

    European mobile service revenue growth was unchanged in Q4 on the previous quarter at -0.1%, tantalisingly close to growth but just held back by renewed mobile termination rate cuts in Germany. ‘More-for-more’ tariff changes are becoming increasingly commonplace, as operators increase data bundle sizes to allow for volume demand growth, but nudge up pricing as partial compensation. This has not yet translated into positive revenue growth across Europe as a whole, but increasingly looks like it will do, with a number of moves made in early 2017.
  • April 12, 2016

    European mobile in Q4 2015 – The challengers’ challenge

    European mobile service revenue growth was flat at -0.8%, while underlying country movements were somewhat more dramatic. The key highlights were Italy returning to positive growth driven by pricing stability, and France showing worsening growth decline for the first time in over two years impacted by challenger telco pricing cuts. An assessment of these challenger telcos highlights a somewhat precarious position, as continued price aggression yields diminishing incremental gains, and they all remain some way from gaining the scale to achieve profitability. The only incentive for challengers to remain aggressive is as an encouragement for their competitors to buy them; increasing regulatory hurdles to consolidation would remove even this incentive, leaving price increases as their only rational route to profitability.
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  • December 17, 2015

    European mobile in Q3 2015 – Consolidation before convergen [...]

    European mobile service revenue growth again improved, albeit marginally, with the quarter’s gain driven by declines easing further in what nevertheless remain the three weakest markets: France, Italy and Spain. Generally stabilising pricing environments were a key factor although ARPUs in these markets remain largely in decline, under continued pressure from strong out-of-bundle revenue declines. In a post-consolidation world, H3G/O2 in the UK and Yoigo in Spain will be the only mobile-only MNOs in the top five European mobile markets, effectively cementing a convergence based future. Consolidation trends might point to the prospect of greater price stabilisation but a fresh land grab for the converged market could derail this. Overall, in spite of healthy underlying data trends, we continue to see medium term growth recovery prospects capped at around 1% given precedent from both the UK, where a healthy economy, healthy pricing environment and strong data trends have failed to exceed this level, and Germany, where post-consolidation revenue growth has reverted to negative territory, both due to competition and consolidation.
  • April 27, 2015

    Media & Telecoms: 2015 & Beyond

    Enders Analysis co-hosted its annual conference, in conjunction with BNP Paribas and Deloitte, in London on 17 March 2015. The event featured talks from 13 of the most influential figures in media and telecoms, and was chaired by Sir Peter Bazalgette. This report provides edited transcripts from some of the talks, and you will find accompanying slides for many of the presentations here. Videos of the presentations are available on the conference website.

  • April 20, 2015

    Free-to-air TV business models

    Prospects for European free-to-air commercial broadcasters are clouded by a weak advertising recovery, decline in TV set viewing by younger age groups and increased competition from pay-TV and international operators. Growth opportunities are nevertheless to be found in fine tuning families of channels to sustain audience shares, increased production of differentiating original content, wider HD and catch-up programmes distribution and smart pay-TV developments – broadcasters must focus on strengthening the quality gap between the TV set experience and online entertainment. ITV has shown the greatest increase in profitability, benefitting from its global production strategy. RTL and ProSiebenSat.1 have a modest upside from carriage fees for HD channels but production and pay-TV initiatives have yet to pay off. TF1 and M6 have withdrawn from pay-TV and face regulatory obstacles to launching channels and production investments. Mediaset in Italy should benefit from the ad market stabilising, but risks large pay-TV losses. In Spain, Mediaset and Atresmedia enjoy an ad boom.

  • January 28, 2015

    UK mobile user survey: High on networks, low on convergence

    Customer movement between operators shows susceptibility to dynamism in branding; O2 are picking up the majority of EE churners as customers move to the new “cool brand” while EE pull in Vodafone churners tempted by the new “best network”. O2 have the lowest churn though the lion’s share move to Vodafone and H3G churners are more evenly picked up by the other three. Customer perceptions of own operator network quality are high among the big 3 with no less than 75% of customers reporting theirs is the best network. O2 is the best regarded while H3G is the least best regarded highlighting a stark contrast between the (prospective) merging parties. Consumers report little interest in quad play and indeed operators in the both fixed and mobile markets have publicly confirmed the same from other market research. However the arrival of converged players in the form of a merged BT/EE or Vodafone re-entering the fixed space will see operators seeking to change this.