Focus Report

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  • January 13, 2021

    Edge Computing – defining the market and business models

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    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 8, 2021

    Future to buy GoCompare Diversification shifts further to ecommer [...]

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    • Publisher Future paid a premium to acquire listed GoCo, the financial services comparison platform, for a cash and shares deal valued at ÂŁ594 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
  • January 8, 2021

    Football rights economics: Low broadcasting competition underpins [...]

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    • Beyond the short-term impact of the COVID crisis, the value of football rights in Europe is heading down
    • Lower competitive intensity in the broadcasting market is the main reason, and looks unlikely to be reversed
    • The leagues must consider long-term initiatives to broaden demand—cash fixes risk worsening their structural problems
  • January 7, 2021

    Battery backup for telco infrastructure: options and necessity

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    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.
  • January 4, 2021

    Steady now, brighter outlook: European mobile in Q3 2020

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    • Mobile growth improved very marginally to -3.6% this quarter as roaming revenues were harder hit and competitive intensity bounced back, but usage recovered from the lockdowns in Q2 and cuts to intra-EU calls were annualised
    • Italy’s fortunes took a turn for the worse as roaming hit particularly hard and Iliad resurged. After a spate of downgrades to the outlook last quarter, there were some tentative upgrades in Q3 although the tone remains cautious
    • The diminished drag from roaming is the primary positive driver from here. Although lockdowns of some degree are in place in Q4, their impact will be less severe than those in Q2
  • December 16, 2020

    Brighter outlook: UK mobile market in Q3 2020

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    The UK mobile market outlook is better as the COVID impact eases overall thanks to reduced roaming impact, but the November lockdown (including store closures) will drag. Having become more cautious last quarter, many of the European operators, including BT and Vodafone, have edged their EBITDA outlook up very slightly.
    • Service revenue declines stabilised at -7% this quarter with a myriad of factors at play: roaming worsening, the end of lockdown taking some pressure off, B2B a mixed bag, and the annualisation of cuts to intra-EU calls
    • Ofcom’s second 5G auction will be a focus in January. We expect selective bidding, proceeds of up to ÂŁ2.7bn, and some wrangling over spectrum trading
    • The outlook is better from here as the drag from roaming eases, in contract price rises step up from the spring, Carphone Warehouse diminishes as a factor in the market, and the prospect of consolidation is still on the table
  • December 16, 2020

    Taking Free-to-Air TV online in Australia: opportunities and chal [...]

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    The report is designed to enumerate the key technical, commercial and equity issues that would arise in the course of such a migration, providing insights and identifying problems that would need to be addressed. Amongst other things, this requires an examination of Australia’s digital infrastructure and its capacity to support television distribution, the media and telecommunications business models that would need to be adapted, and the response of households to the changes in consumer technology that would be required. A household survey was also undertaken to inform this report, and details are included in the Appendix. The report is not a proposal that free-to-air television should entirely move to online delivery, nor is it a strategy to get there. Nor is it a cost-benefit analysis.
  • November 24, 2020

    New Zealand Consumer Broadband Behaviour Survey – Round 2

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    The purpose of this survey (completed 28th October 2020) was to compare the results with the results of the similar April survey, and understand the change in consumers’ response to COVID-19 over time in a range of areas including broadband usage, work from home, video conferencing, online shopping and telehealth. The comparison with the results with our April 2020 survey provides insights on consumer behaviour pre-COVID, during COVID and now. The survey was conducted nationally across New Zealand for 1,016 respondents, all with a broadband connection, and with a representative survey sample across demographic and regional groupings. The demographics have been discussed in detail in the last section of the report.
  • November 23, 2020

    e-Pharma: the rise of online pharmacy

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    This report provides a quantitative snapshot of the evolution of Australia’s pharmacy sector, in light of the coronavirus (COVID-19) epidemic and the new technologies and business models that are making prescription drug distribution more convenient to Australians. The Australian government is currently introducing e-prescriptions under two models: the Token Model (where patients use a paper token or an electronic token sent to their device to access their electronic prescription) and the Active Script List Model (where patients gain access through their assertion of a single identity rather than through presentation of a token).
  • October 22, 2020

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

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  • October 15, 2020

    STV: Pulling the levers for growth

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  • October 13, 2020

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

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    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

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    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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  • October 7, 2020

    European TV & video subscription platforms: Recovery from lo [...]

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  • October 2, 2020

    Made in China- TikTok Global between a deal and the precipice

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    ByteDance is rushing to sell a 20% stake in TikTok Global to Oracle and Walmart at an enterprise value of $60 billion. TikTok otherwise faces a ban in the US on 12 November, subject to legal challenges

  • October 1, 2020

    Commentary: Webscale Capex in 2Q20

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    As WNOs have grown, they’ve developed more sophisticated offerings in the cloud, often targeting specific vertical markets with customized platforms, including telecom. This is impacting how telcos build their networks and develop services. In the last year, webscale partnerships with telcos have expanded, spanning workload shift, joint development, and service partnerships – often supporting 5G. In January, our research partner MTN Consulting flagged the need for more collaboration between telcos, WNOs, and carrier-neutral providers as essential for 5G success as telcos aim to lower their capex outlays.
  • September 17, 2020

    Australia consumer and SMB broadband pricing trends – Broadband [...]

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    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 – Telstra, Optus, TPG and Aussie Broadband to evaluate their broadband offerings in the retail market.
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  • September 7, 2020

    Australian Small Business Survey: 5G broadband battleground for O [...]

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    This report presents the survey results across 602 small businesses and highlights their views on willingness to pay, churn intentions and their views on 5G mobile and fixed wireless broadband. The survey was targeted towards the IT decision makers in small businesses, which this survey defined as having an employee count of between 5 – 20 employees.
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    cover media
    August 31, 2020

    Nine, Seven results: COVID impact disguises accelerating FTA reve [...]

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    As we have said previously, the FTA advertising revenue market faces major structural headwinds as audiences transition away from linear television. Both Seven and Nine reported declines in their core FTA advertising businesses in FY19 and FY20. The decline in linear FTA advertising revenue in 1H20, before COVID-19 hit, was 7% YoY. This was an acceleration of the decline compared to FY19, but the effect was of course swamped by the impact of COVID-19 in the second half. As expected, COVID-19 had a disruptive and negative impact, particularly in Q4. This is reflected in the FY20 revenue results, but will flow through into FY21 because the longer-term economic impacts of COVID-19 shutdowns have yet to be felt. To counter this trend and the one-off impact of COVID-19, Seven and Nine are managing the decline of the FTA market by following through with their investments in digital platforms (BVOD), improving yields on existing content, developing programmatic and addressable TV solutions, and cutting costs. SevenWest and Nine were also able to make gains in cost reduction and new revenue growth that kept them in the black. These green shoots give some hope for a digital rebound in the wake of the COVID-19 disruption. However, it will be several years before BVOD is enough to significantly offset FTA declines.
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  • August 27, 2020

    The Australian tower market 2020

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    This report assesses the Australian mobile communications tower market and the drivers for tower and small cell demand in Australia. The rollout of 5G and renewed interest in small cell technology is an opportunity to reconsider the financing and ownership of potentially shareable infrastructure.
  • August 18, 2020

    ITV UK H1 2020 results

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    There may be light at the end of the tunnel. After Q2 advertising revenues dropped 43% YoY, ITV has noted that there has been an upward trajectory (July down 23%, August appearing to be even better). This would leave ITV’s advertising revenues down between 15-25% for 2020 (ITV is unwilling to give forecasts). It appears that advertisers are beginning to think further ahead than they have for months—anecdotally, while around 80% of ad revenue is normally booked prior to the month’s start, this had reversed to about 20% in Q2.
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  • August 17, 2020

    Telstra and nbn Co FY20 update: increasing wireless and enterpris [...]

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    Telstra’s and nbn Co’s FY20 results show the early impact of COVID-19, but also contain indications of underlying shifts in the industry. We expect rising competition for fixed broadband subscribers as the mobile network owners (MNOs) try to maximise returns from the 5G mobile investment by launching 5G fixed wireless. Telstra’s announcement it will roll out 5G fixed wireless will step up this rivalry.  
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  • August 14, 2020

    Update: Foxtel SVOD growth can’t prevent major restructure

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    Last year we reported on Foxtel’s battle with its OTT rivals, and its attempt to capture a share of the OTT market. In 2019, we had a number of concerns about Foxtel. With the release of the News Corp FY20 results on 11 August 2020, this report examines whether our concerns were justified. In summary, we think that the last twelve months have largely borne them out, with the exception of Kayo cannibalisation.  
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