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  • New
    April 21, 2021

    Brief reprieve from COVID turbulence: UK mobile market in Q4 2020

    The sector rebounded slightly in the quarter to December thanks to a seasonal improvement in the roaming drag, although the partial lockdown tempered the recovery. We await imminent news on spectrum trading, and there may also be some licence fee reductions as a consequence of the lower prices in the recent 5G auction. While the sector is likely to continue to struggle into Q1, the outlook is much brighter thereafter thanks to the annualisation and even reversal of some lockdown effects, and to higher price increases from the spring.
  • April 8, 2021

    The recovery stutters: UK broadband, telephony and pay TV trends [...]

    • Market revenue growth sunk back to -3% in Q4 from -2% in Q3, with further backbook pricing and lockdown effects to blame.
    • Backbook pricing will improve with numerous price increases announced, but these will only start to take effect in Q2 2021.
    • Demand for broadband and ultrafast looks promising, but will also take time to filter through to revenue, with Q1 again lockdown affected.

  • March 25, 2021

    A worthwhile flurry of activity? Mobile towers companies in focus

    • The wave of deal-making in the European towers sector is driven by cash-strapped telcos seeking a form of sale and leaseback financing
    • While the operators are incentivised to provide a medium-term growth trajectory for these towers companies, sustainability of that growth is more questionable, especially as 5G will not require additional base stations
    • Cellnex continues to insinuate itself into the UK market with its most recent deal signaling the ultimate unwinding of the MBNL JV. Further UK towers consolidation seems a long way off but could facilitate, or indeed be facilitated by, consolidation at the MNO level
  • March 18, 2021

    End-of-line spectrum 50% off: UK second 5G auction results

    Proceeds in the swiftly concluded second 5G auction were £1.36bn, very much towards the bottom end of the estimated £1-2.7bn range in our recent report 2021 spectrum auction: Uncertainty prevails [2020-117]. The prices paid are very low by historic standards, particularly for the 700MHz band but the spectrum most suitable for 5G (3.6-3.8GHz) is also more than 40% below the price achieved in the auction for very similar spectrum in 2018.
  • March 9, 2021

    Virgin Media: Subscribers strong, ARPU tough to turn

    • Virgin Media‚Äôs subscriber growth continues to be very strong, and it looks like next quarter‚Äôs price rise will (at worst) only stall, not stop, the renaissance
    • ARPU was hit in Q4 by the postponed price rise, and it will likely remain in decline in 2021, with regulatory pricing pressure and lockdown effects still weighing, despite firm new customer pricing
    • Nonetheless, accelerating subscriber growth is expected to drive group revenue growth positive again (helped by B2B growth), and Virgin Media‚Äôs main strategic problem‚ÄĒits fibre trilemma‚ÄĒlooks like it will be dealt with after the merger with O2, expected
  • February 22, 2021

    Vodafone: Leverage looms large

    • Generating cash is top of Vodafone‚Äôs 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
  • January 19, 2021

    (UK) TalkTalk: Mixed results, future opaque

    • TalkTalk‚Äôs 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 ‚Äėreposition the brand‚Äô includes a move upmarket
  • January 15, 2021

    Roaming charges to return for some: Free EU roaming an optional e [...]

    • 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‚Äôs 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‚Äôs 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
  • January 13, 2021

    Edge Computing ‚Äď defining the market and business models

    Edge 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 7, 2021

    Battery backup for telco infrastructure: options and necessity

    The 2019-20 bushfire season has renewed the focus on battery backup for telco infrastructure. About 88% of the tower outages were caused by power failure and only 1% was were due to direct fire damage. Thus, a better power backup could have significantly improved the emergency response during the bushfires by reducing tower outages.
  • December 10, 2020

    2021 spectrum auction: Uncertainty prevails (UK)

    COVID, potential consolidation, implications for ALF pricing and non-contiguous blocks have conspired to make the forthcoming second 5G spectrum auction a highly complicated affair.
  • December 2, 2020

    Recovery…of sorts: UK broadband, telephony and pay TV trend [...]

    • Consumer broadband, telephony and pay TV market revenue growth recovered to -2% in Q3 (from -6% in Q2), with the recovery in premium sports channel revenue being partially mitigated by a worsening in backbook pricing pressure at BT
    • This is however still weaker than pre-COVID levels, with said backbooking pricing pressure affecting all operators to some extent, and intensifying as Ofcom-mandated end-of-contract notifications are rolled out, with annual best tariff notification due over the next few months
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  • November 23, 2020

    Vodafone: Bright spots and low lights

    There are some reasons to be cheerful about Vodafone right now‚ÄĒsmall nuggets of encouragement in its H1 results and the prospect of some market repair in the UK. Annual in-contract price rises of CPI + 3.9% across the UK mobile sector could provide very valuable support
  • November 16, 2020

    FY20 Investor Day ‚Äď Telstra counting on its 5G leadership to im [...]

    Telstra held its annual Investor Day event on 12th November 2020. Telstra CEO Andy Penn and senior management addressed progress on its T22 strategy, the financial and earnings outlook, changing dynamics in the Enterprise market, progress on the 5G rollout, and changes to the company structure. In this report, we have analysed some of the key announcements from the event and provided our take on the same.
  • November 13, 2020

    Update: The Australian tower market 2020 ‚Äď Telstra‚Äôs TowerCo

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    The market for traditional macro-towers in Australia is mature. All three carriers have been expanding their tower networks only incrementally in recent years, and site growth is low. 5G will not change this significantly, because 5G base stations are being mounted on existing towers, not new ones.
  • November 13, 2020

    Virgin Media: Subscriber growth renaissance continues

    Virgin Media’s lockdown subscriber surge continued into Q3, as working-from-home highlights the importance of the faster speeds its network can offer.
  • November 9, 2020

    BT: Glacially improving outlook

    BT had a fairly mixed September quarter at the revenue level, with post-lockdown recovery evident in a number of areas, such as wholesale/commercial sports, Openreach installation and network build volumes, and consumer mobile net adds, but revenue weakness in mobile roaming (seasonal factors) and consumer fixed (regulator-inspired price cuts) resulted in overall group revenue growth unchanged.
  • November 5, 2020

    MVNO Update: Has the Australian MVNO market peaked?

    Australian MVNOs (not including sub-brands) have seen their market share grow from 6% in 2010 to 15% in 2020 with a majority of the growth happening between 2010-2015. However, we believe that MVNOs have reached a peak in Australia in FY20.
  • November 4, 2020

    O2 Looking beyond the nadir

    There was just a slight deterioration in trends at O2 this quarter as the COVID drag was fairly constant in total, although varied in mix. However, the iPhone launch in Q4 rather than Q3 was almost as detrimental to total revenue growth which will reverse next quarter
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  • October 22, 2020

    nbn’s Enterprise Market Strategy: Complementary or Competitive [...]

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  • October 13, 2020

    Apple 5G iPhone: Telstra’s opportunity for Christmas consumer c [...]

    Telstra has recently announced (12th October 2020) that it has deployed more than 2,000 5G sites covering more than 41 per cent of Australia’s population. In addition, the telco states that it is on track to reach 75% population coverage by June 2021.
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    cover 5G
    October 9, 2020

    Australian Household 5G Fixed Wireless Substitution Forecast

    The advent of 5G, combined with an increase in smart device penetration, has made 5G fixed wireless and mobile broadband more attractive to consumers, and this will lead to a significant growth in wireless broadband usage. As consumers rely more and more on wireless broadband (both mobile and fixed wireless) connectivity, customers may look to cut their fixed broadband connection and rely on wireless devices for broadband connectivity.
  • October 8, 2020

    Back in play: Merger prospects in UK mobile resurrected

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  • September 17, 2020

    Australia consumer and SMB broadband pricing trends ‚Äď Broadband [...]

    Broadband services are critical enablers for access to information, employment, markets and key services. Consumer demand for broadband services has grown rapidly in the last decade with household penetration increasing to 85% in 2019 compared to 64% in 2009. This report analyses the competitive environment in the fixed broadband market, focussing on consumer price trends. In particular, we analyse the major RSPs ‚Äď Telstra, Optus, TPG and Aussie Broadband to evaluate their broadband offerings in the retail market.
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