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  • September 16, 2016

    BT Sport: positive first year with the Champions League

    BT Sport has seen a very clear positive impact from its first year airing the Champions League, with viewing up 60% year-on-year to June. Remarkably, its reach is now not too far off Sky Sports, though it still has some way to go in terms of consistent viewership.

  • September 14, 2016

    Untapped not tapped out -The over 50s -­ systemic consumption an [...]

    More than one third of the UK population is over 50 (over 23.6 million people) and this cohort is projected to keep growing. They account for substantial wealth, assets and expenditure. Over 50 consumers are more urban, educated, and tech-­‐savvy than the over 50s of previous generations. Given their outsize impact on the economy, influence on social trends and opportunity for brands, we believe the marketing industry underappreciates the diversity of over 50s, and their differentiated requirements. The key group in terms of potential in growth, wealth, expenditure and digital adoption are the 50-­‐65s: they are neither their children nor their parents.
  • September 5, 2016

    UK mobile market Q2 2016: Revenue growth slows, profitability res [...]

    UK mobile service revenue growth dipped in Q2 to -1.7%, a 1.5ppt drop from the previous quarter. About 0.2ppts of this drop was accounted for by a (temporary) jump in the MTR cut impact, but the rest was due to underlying factors. These factors were various and differed in their impact on the different operators, and they include the EC-mandated roaming cuts, the leap year effect and the continued growth of SIM-only, as well as pricing changes that appear to have been reversed since the quarter’s end. Macroeconomic weakness does not appear to have played a part so far, mainly because there has not been any consumer-led macroeconomic weakness, and although some indicators have worsened since the quarter’s end, the change is still quite slight so far.

  • August 31, 2016

    The matter of Peak TV, and what it means for the UK

    Whether the US has reached “Peak TV” —the apogeic volume of original scripted series—is debatable, but the mass of content being produced is unparalleled. As television continues its transition from a disposable medium to a permanent one, and an increasing number of outlets are creating original, scripted programming to keep up or differentiate, does this American explosion have ramifications for the UK consumer or broadcaster? Simply put, the UK’s more concentrated television landscape limits exposure. And, counter-intuitively, an unsustainable focus on scripted drama could play into the hands of the traditional broadcasters, whose future strength may lie in the diversity of their offering.

  • August 12, 2016

    US and UK: Cord-cutting-shaving-nevering

    Cord-cutting has become a major headache for US pay-TV operators in the last three years, while cable network channels face further erosion due to cord-shaving and we now see a rapidly growing population of cord-nevering households that have never taken a pay-TV subscription. Should we expect it to be only a matter of time for the UK to follow the US? The short answer is no, due to major differences in the pay-TV market infrastructures of the two countries, which leave the UK much less exposed. However, downward pressures from the online space do exist in both countries, while the big cord-cutting-shaving-nevering threat we now see in the UK has most of all to do with the chill Brexit winds on the economy.

  • Amazon Prime Air pilots in the UK
    Amazon Prime Air pilots in the UK
    August 11, 2016

    Amazon Prime Air pilots in the UK

    Amazon will test three possible features of their drone delivery system in the UK, which could make this novel shipping solution for small packages viable. When it launches, Prime Air will be limited to a catchment area of 2.3 million homes in the UK, with further exclusions for no-go areas for drones like airports and urban areas. Prime Air’s UK pilot will help the Civil Aviation Authority (CAA) craft the rules for future drone delivery by retailers.

  • August 8, 2016

    Sky firing on all cylinders: FY 2016 results

    FY 2016 has been an excellent year, with all three Sky markets showing improved performance as Sky delivered 7% revenue growth (5% after adjusting for 2016 being a 53-week year) and 12% increase in operating profit. The success reflects Sky’s commitment to product and service innovation and diversification in an increasingly fragmented marketplace combined with tight control of back office costs and focus on synergies. As a measure of its success, Sky has set new cost synergy targets of £400 million annual run-rate by FY 2020 and is aiming for continuing middle to high single digit growth in revenues, which should let it comfortably absorb the rising costs of Premier League and Bundesliga live televised rights under the next contracts.

  • August 2, 2016

    Steady progress: ITV H1 2016 results

    ITV H1 2016 revenues and EBITA showed double-digit growth year on year, though the greater share came from ITV Studios acquisitions of independent producers and H1 2016 was sequentially down on H2 2015, with ITV Studios accounting for most of the decrease. ITV Family NAR was flat year on year. Though Brexit has led to growing fears of a sharp downturn, ITV appears relatively well placed to handle such an outcome: ITV Main channel 7% uptick in H1 viewing share; £25 million targeted cost efficiencies in 2017; healthy balance sheet. ITV Studios revenues have doubled in scale since 2011 following 15 acquisitions of independent production companies; yet just how well the underlying business is performing organically is hard to assess due to the bumpiness of short term trends.

  • July 22, 2016

    Mid-form video: Beyond the long and the short of it

    Video content is crudely defined. If something is not very short (<10 minutes) then it tends to be considered long-form. But there is a middle ground - one which displays a distinctive combination of characteristics in terms of production, broadcasting and viewing. Mid-form video (between 10 and 20 minutes) has the ability to carry the narrative arcs normally associated with long-form programming, whilst also retaining the snackable and shareable attributes of short-form. The footprint of mid-form is, so far, small. However, it is growing, as its unique qualities, such as excellent ad completion, become more readily recognised.

  • July 18, 2016

    Mobile Google: beyond the smartphone

    Google’s recent product updates and upcoming features aim for as many users on as many platforms and devices as possible – a return to strategic form. The company has a dual approach: using Android as a mobile trend-setter while also devising new ways for users and developers on other platforms to use Google services. The reach provided by these initiatives will help Google’s machine learning algorithms to better understand and predict user intent – the cornerstone of the company’s ad business.

  • Consumer magazines Print still key; radical innovation emerging
    Consumer magazines Print still key; radical innovation emerging
    July 4, 2016

    Consumer magazines Print still key; radical innovation emerging

    UK consumer magazine print circulation fell -9% in 2015 while total display advertising fell -7% as magazines continue to outperform other press categories. However, the overall picture is still one of falling consumer and advertiser demand and the fierce competition for user attention and advertising spend online is reflected in consumer magazine digital display advertising growth of just 12%: about half of the total online display growth rate in 2015. At the same time publishers are starting to embrace radical innovation using their brands to produce multiple revenue streams ranging from e-commerce to events, as we explore in our four publisher case studies included in this report.

  • July 1, 2016

    Brexit dismal media outlook

    The victory of the Leave campaigners in the EU referendum offers no clear benefits to the audiovisual sector, whether we consider domestic and international broadcast distribution across Europe or the creative production sector. The present lack of a clear roadmap and climate of uncertainty promises to be harmful across the entire media sector at least in the short-term, raising the distinct prospect of a recession later this year or next, causing us to downgrade our forecasts from February this year. The Brexit process raises many issues and will be drawn out over several years as the UK finds its feet in the new world. If the UK audiovisual sector is to emerge relatively unscathed, it is vital that it retains its ties with the Single Market by joining the EEA. The alternative is unthinkable.

  • June 28, 2016

    Global music publishing 2016

    Music publishing revenues are trending up in a broad sustainable manner across the US, Europe and Japan, underpinned by longstanding music rights regimes.

  • June 27, 2016

    Parents and their children online

    Cinema, TV and VOD services share the same ratings regime in the UK, giving parents confidence they can discern content unsuitable for their children. Risks to children of being exposed to unsuitable content and advertising multiply on the ‘open’ internet.
  • June 22, 2016

    Consumers and digital marketing – Challenges and tensions a [...]

    UK digital advertising will grow beyond £10 billion by 2018 by our estimates, representing more than half of all advertising spend and delivering the most advanced large advertising market in the world on a per capita basis. Nevertheless, we see critical issues in digital marketing that are frequently acknowledged, but hard to fix. At the heart of our hypothesis is the view that the marketing industry – brands, agencies and media – has focused on technology and efficiencies at the expense of consumer experience and distinctiveness.
  • June 16, 2016

    TV genres and viewing trends over time

    TV viewing has one reliable, long term trend: programme genres are watched by consumers at predictable life stages and ages. At a high level, there has been little manipulation of the balance of genres being broadcast. But amongst the sub-genres, editorial optimisation has resulted in an uptick in actual viewing. As the core viewing age of linear television rises, there is an opportunity for broadcasters to leverage this to create the most desirable schedule for their available audience by daypart; with genres that transcend demographics when younger viewers tune in.
  • June 14, 2016

    Sky plays long term with Bundesliga

    The award of the match packages in the 2017-21 domestic football rights auction in Germany is probably optimal for Sky (within the “no single buyer” constraint): it will broadcast about eight out of nine weekly fixtures including the top picks, while Eurosport’s package is complementary to Sky’s rather than substitutional. Sky will, however, pay a hefty price, with the new contract costing 80% more than the current one – although the new Bundesliga rights value is not out of line with other Continental leagues. We expect Sky’s German operations to briefly break even in fiscal 2017 before falling back into losses with a return to profit if other costs are kept under control. Management has made a bold statement of self-confidence: building scale is the priority.
  • June 8, 2016

    UK news media: less advertising, new models

    The decline in print display advertising in national newspapers accelerated to -16% in 2015, while growth in digital advertising is slowing, and will be unable to offset revenue decline for the foreseeable future. We believe this decline is structural and irreversible, continuing at a sharper pace than before despite the recovery in the UK economy in 2013-2015, and very different from the cyclical decline of 2009. Publishers must convince brands and agencies that in the mobile era their superior content environments have added value. If scale newsrooms are to survive, costs must be reduced through collaboration and outsourcing­.
  • June 2, 2016

    Amazon Video Direct: self-publishing for videos

    Amazon’s newly launched open video hosting service, Video Direct, will appeal to creators of ‘professional’ videos by offering them a new platform and monetisation options. Amazon’s attractiveness to video creators resides mainly in the prospect of earning a portion of subscription fees from millions of Prime members. While Video Direct might not become a huge business for creators, this move cements Amazon as a media platform and risks hurting YouTube.
  • June 1, 2016

    New VOD rules in the EU Digital Single Market

    The Commission proposes to require VOD services to implement a 20% share of EU works in catalogues, which Netflix already largely meets. More impactful is the EU’s proposal for OTT SVOD services to provide access to the home service when subscribers travel in the EU, benefitting the UK’s 14 million subscribers. TV broadcasters, which observe a 50% EU works threshold in their linear programming served on TV platforms and online players, will be able to opt-in to portability.
  • May 26, 2016

    Google Home takes on Amazon Echo

    Google Home will compete against ­­­­Amazon’s Echo in the contest to supply voice-activated home hubs to US homes.Google claims Home is better at voice-based search due to its superior capabilities; pricing is unknown, but is likely to be at par with Echo ($179).Prime, Fire devices and media services are competitive advantages for Amazon in the US that will make it hard for Google Home to succeed there.

  • May 18, 2016

    Novel disruption for consumer books

    Consumer book sales look unusually resilient in the context of the extreme changes in other print media sectors, newspapers and magazines, over the past decade. Ebook and ecommerce sales have offset the high street sales decline, although the declining number of retail outlets casts a long shadow over the future of discovery. New options for authors, particularly self-publishing ebooks, threaten the existing funnel of authors to publishers, but could also be a new source of talent.

  • May 16, 2016

    Facebook leans in to video

    Facebook has become the second largest online video platform after YouTube by viewing time, largely thanks to muted autoplay streams - for the moment. This is about to change as Facebook seeks to grow viewing and expand inventory with a new standalone video hub, live streams and revenue share models for professional content. Facebook’s lofty ambitions to become a destination for long-form, premium video content will be harder to achieve and less compatible with current strengths than for online news.
  • May 3, 2016

    Content marketing online in Europe to 2020

    Paid placements for content marketing online in Europe will increase by 186% from 2014-2020, to over €2 billion. It is a particularly exciting area for premium publishers, who can leverage their content expertise to reverse the flight of ad money to lower-cost properties. Almost all are developing creative content offerings to capture this value. Metrics and measurement, disclosure and cost remain as challenges for content marketing online, but growth is strong due to high commitment to spend from advertisers.