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February 24, 2021Sports rights market hits an inflection point: New distribution p [...]
Focus Report, ReportsThe fire smouldering beneath the traditional sports broadcasting model burst into flame in 2020. We have argued that sports rights payments in the ANZ market were not sustainable. The rising value of deals could not be reconciled with falling broadcast TV revenues. In this report, we discuss the current state of the Australian sports rights market, delve into the current struggle of traditional broadcasters, and contemplate what is next for the delivery of sports content. -
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February 24, 2021Google and Facebook lay out diverging news strategies: Battlegrou [...]
Flash Report, ReportsGoogle is demonstrating support for news by stepping up its efforts to license content from publishers and provide unpaywalled access within its Google News app—an attempt to diffuse regulatory pressure.
Google is reconfiguring its relationships with publishers worldwide, putting $1 billion on the table to license news content to News Showcase through a series of flat fees over a set period of time.
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February 22, 2021Vodafone: Leverage looms large
Focus Report, Reports- Generating cash is top of Vodafone’s agenda right now, and we may be seeing early signs of that driving operational tactics ahead of resolving its leverage crisis through either an IPO of Vantage or a sale of its Iberian assets
- EBITDA growth would really help. Analyst forecasts of +4% for next year are not supported by recent history and a simple bounce-back of roaming revenues should not be assumed
- Q3 results were a mixed bag with the very slight improvement in revenue trends accounted for by easing roaming pressure. Green shoots in German fixed is a highlight, with growth in UK mobile a touch disappointing
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February 18, 2021BT: A bumpy road
Focus Report, Reports- BT’s December quarter results were mixed, with revenue growth improving but EBITDA growth worsening, and next quarter will be hit by the effects of lockdown 3 on mobile, with B2B likely to be hit by business failures following the end of furlough
- BT has maintained/nudged up its financial guidance regardless, and there are plenty of positive longer-term signs, with subscriber growth strong in the quarter, pricing pressure easing, and full fibre roll-out and adoption progressing nicely
- Overall, we expect the road to continue to be bumpy, but a recovery by 2022/23 still seems very plausible, ultimately driven by the wholesale and retail benefits of full fibre, and perhaps helped if it can get ‘Digital’ right, a particular challenge historically for BT
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February 15, 2021Telstra 1H21 update reflects industry trends
Focus Report, ReportsTelstra reported earnings on 12th February 2021. In this report, we have summarised the earnings update. In our view the results are consistent with the top telco trends in 2021 that we identified earlier this year. -
February 12, 2021Video viewing survey: household consumption across formats to rem [...]
Focus Report, ReportsVenture Insights conducted a video consumer survey in late November/early December 2020 in collaboration with Swinburne University of Technology. The survey was conducted nationally for 1,003 respondents, with a representative survey sample across demographic and regional groupings. Those respondents who watch free to air TV, pay TV, catch-up TV or SVOD services qualified to participate in this survey. -
February 10, 2021The inexorable rise of games: Five themes for 2021
Focus Report, Reports- The games industry enjoyed a robust 2020, with the pandemic creating high demand across titles and platforms. Now a core part of the mainstream media and entertainment ecosystem, games share of entertainment spend and audience viewing time will maintain momentum and increase in 2021
- The demand for, and value of, premium content has migrated to game IP, with top franchises driving increased M&A activity and tighter integration with film and TV output, and providing an important advertising channel
- The pandemic has provided breathing space for the industry on regulatory scrutiny of revenue models, and overall consumer safety. Regulators need to increase their speed in 2021, and act decisively on predatory ‘free-to-play’ game mechanisms
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February 9, 2021Amazon and sports rights: Gaining confidence
Flash Report, Reports- Thanks to lockdown momentum, Amazon Prime Video grew substantially in 2020. Christmas time coverage of the Premier League seems to have played a part, informing Amazon’s approach elsewhere
- Upping its game, Amazon has acquired more expensive Champions League rights in Germany and Italy. It also bid in Monday’s failed French Ligue 1 auction
- In the impending Premier League tender Amazon may be ready to increase its outlay if needed to meet subscribers’ expectations, but without any real incentive to challenge Sky and BT’s dominance
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February 9, 2021Amazon beats the flu: Non-commerce drives impressive growth over [...]
Flash Report, ReportsThe pandemic has pushed ecommerce to new heights around the world, as consumers substitute their offline purchases for online in the absence of being able to leave their homes. In this new paradigm for retail, Amazon stands to benefit most, providing customers with convenient one-day delivery and a range of competitively priced products. -
February 5, 2021Global Britain is born: Post-Brexit muddle
Flash Report, Reports- The EU-UK Trade and Cooperation Agreement (TCA) grants zero-tariffs only to goods compliant with rules of origin, a subset of the goods previously traded freely, and dramatically raises barriers to exports, especially services, relative to the Single Market
- UK (and EU) traders of goods must assume new onerous, costly and disruptive customs clearance procedures, also applicable to other third parties, which are certain to radically downsize trade with the EU, especially B2C e-commerce, typically single parcel
- The UK’s initial vision of Global Britain via a pact on trade, security and defence with the US, rather than the EU, is not a priority now for President Biden, who also has a stake in the open border on the island of Ireland
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February 4, 2021Top 5 Media Trends in 2021
Market Outlook, Reports2020 was a disruptive year for everyone, including the media industry. The pressures have exposed industry fault lines and toppling entrenched arrangements. Our top media trends for 2021 are:- SVOD market flattens
- Sports rights shakeout to continue
- We’ve passed “peak platform”
- Programmatic advertising transcends the cookie
- Localism’s last throw
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February 2, 2021Still the iPhone company: Apple’s record pandemic year
Flash Report, ReportsMobility is vital to companies selling products, rather than online services. However, all regions grew double digits in the quarter, with global growth hitting a bumper 21%.
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January 28, 20212021 Video Entertainment Market Outlook
Market Outlook, Reports- We forecast the Australian video market to decline at a 2% CAGR to about A$5.5bn in 2024, driven primarily by the revenue deflation as viewing shifts from traditional to digital platforms.
- COVID-19 has provided a massive boost to SVOD revenues, which will continue to grow at a 9.3% CAGR through to 2024. However, we forecast a significant decline in Pay-TV and Physical media formats.
- Pay-TV will remain under pressure driven by the structural changes in the way video content is consumed. While Foxtel will offset some of this pressure by participating in the SVOD market, it will not be able to recover the losses in its traditional Pay-TV business.
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January 27, 2021CES 2021: Consumer tech show switches on to the pandemic
Flash Report, ReportsThe home is now a bastion of more activity than ever before, from working to entertaining to socialising—more is being demanded of the domestic space—and in 2021 the consumer tech show offered a more holistic approach to the Internet of Things (IoT), accepting a ‘new normal’ would be centred on the home, even as the effects of the pandemic recede. -
January 22, 2021Netflix Q4 2020 results: 200 million subs with cash piling up
Flash Report, ReportsNetflix believes that it no longer needs to raise external financing for its day-to-day operations
This has come quicker than expected: the company had previously gone from the opaque “next few years” narrative it held for some time, to “rapidly closing in” on sustainable positive cashflow just last quarter, meaning that it was a “couple” of years off. One quarter later Netflix is confident its free cash flow will break even in 2021, up $1 billion on its prediction three months ago. -
January 21, 2021Top 5 Telco Trends in 2021
Flash Report, Reports2020 was a disruptive year for everyone, including the telecommunications industry. But as a semblance of normality emerges, change in the industry continues unabated. Our top telco trends for 2021 are:- Low end operator brands seize leadership in the consumer market
- Telco infrastructure comes into play as operators seek to monetise assets
- Government refocus on regional communications as nbn rollout ends
- Enterprise market shift as nbn disrupts the fibre wholesale market
- 5G comes into its own as handset availability surges and coverage expands
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January 21, 2021(UK) Update 2021: COVID-19 and Mobility
Flash Report, Reports- The UK entered 2021 in the grip of a dangerous third wave of the pandemic, despite Lockdown 3.0 over Christmas, driving down trips taken by people to depressed levels last seen in Lockdown 1.0, reducing economic activity for Q1
- Time spent at home closely tracks the severity of lockdowns and mandates to work from home (WFH). Underpinned by the UK’s advanced digital infrastructure and services, WFH is providing resilience to Gross Value Added (GVA) creation, while staff in B2C activities are furloughed
- The City of London is emblematic of the potential for outsourced GVA creation under WFH. Its skilled and highly paid staff are too valuable to employers to risk exposure to the virus. WFH, largely preserving GVA, will anchor the future of work
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January 19, 2021(UK) TalkTalk: Mixed results, future opaque
Flash Report, Reports- TalkTalk’s latest results were mixed at best, with ARPU and revenue growth improving off a low last quarter, but net adds worsening, EBITDA falling sharply and full year EBITDA guidance suspended
- Its outlook remains challenging, with the move to high speed still a drag on EBITDA, and the migration to ultrafast a further (even greater) challenge, although this brings opportunity as well, especially if the company can move away from its discount brand focus
- Its prospective new owners highlight the need to invest in brand, systems, and full fibre capabilities to meet this challenge, but it is not clear where the money to do this is coming from, and it is also not clear if the desire to ‘reposition the brand’ includes a move upmarket
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January 15, 2021Roaming charges to return for some: Free EU roaming an optional e [...]
Flash Report, Reports- Lockdown 1.0 in March-April-May 2020 reduced mobility in London to 65% of its pre-pandemic baseline, swelling time spent at home. London’s mobility tracked a similar decline to Paris and New York City, all hugely reliant on public transport
- Easing lockdowns and good weather slowly led to a mobility recovery through the summer and early autumn, but it sharply declined again after November’s Lockdown 2.0. The mobility decline was greatest in the City of London, which is more acutely affected by working from home
- Each nation in the UK diverged slightly from September due to varying local policies adopted by England, Wales and Scotland to address their public health crises. Notably however, Lockdown 2.0 did not cause mobility to fall to the same degree as late March
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January 14, 2021(UK) COVID-19 and Mobility
Flash Report, Reports- Lockdown 1.0 in March-April-May 2020 reduced mobility in London to 65% of its pre-pandemic baseline, swelling time spent at home. London’s mobility tracked a similar decline to Paris and New York City, all hugely reliant on public transport
- Easing lockdowns and good weather slowly led to a mobility recovery through the summer and early autumn, but it sharply declined again after November’s Lockdown 2.0. The mobility decline was greatest in the City of London, which is more acutely affected by working from home
- Each nation in the UK diverged slightly from September due to varying local policies adopted by England, Wales and Scotland to address their public health crises. Notably however, Lockdown 2.0 did not cause mobility to fall to the same degree as late March
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January 13, 2021Edge Computing – defining the market and business models
Focus Report, ReportsEdge computing is, fundamentally, the placement of processing and analysis capabilities near the edge of the network close to the sources of data to achieve these objectives. This deployment requires a fairly complex value chain of resources and capabilities. As a result, it is taking time for the structure of the edge computing market to emerge, and for the required partnerships and associated business models to develop. We expect this process will take years, as edge computing grows in scale and sophistication from its current rudimentary beginnings. -
January 11, 2021(UK) Montgomery shakes news market again: JPI, third largest loca [...]
Flash Report, ReportsThe low price paid reflects the dismal prospects for print media, especially regional and local titles relative to national titles. Over the past decade, regional publications were affected at a greater rate than national counterparts by the structural decline of print circulation and advertising, resulting in significantly more closures, as well as issue frequency reductions. -
January 11, 2021Serie A TV rights auction: Deflation looms
Flash Report, ReportsOn Monday, Italy’s Serie A issued its call for tender for its broadcasting rights for the 2021-24 cycle, covering three seasons. Bids are due by 26 January. Currently, Sky holds exclusive coverage of seven games per week with the remaining three fixtures carried by DAZN. -
January 8, 2021Future to buy GoCompare Diversification shifts further to ecommer [...]
Focus Report, Reports- Publisher Future paid a premium to acquire listed GoCo, the financial services comparison platform, for a cash and shares deal valued at £594 million, provided GoCo shareholders approve the deal at a vote in January
- For Future, the purchase of GoCo gives it a platform for consumers for whom the service is free, deepens its tech stack and diversifies revenues to affiliate fees earned from ecommerce
- Future's strategy of growth by acquisition has helped offset structural decline in the print portion of the business. The question is whether GoCo will generate sufficient returns to justify the premium paid