September 14, 2014 Reports
Claire Enders set out the implications of a Yes vote in the Scottish independence referendum for the media available in Scotland. She critically examines the SNP's plans for a Scottish media, and argues that Scotland's small population would make an independent media hard to sustain. When the effect of a nationalist 'nation-building' project is factored in too, the overall results would be serious costs to the quality of democracy Scots enjoy.
Claire Enders set out the implications of a Yes vote in the Scottish independence referendum for the media available in Scotland. S [...]
September 7, 2014 ReportsUKTV has posted annual figures showing record revenues of £278 million in 2013, with the promise of more to come after an H1 2014 that has seen it overtake Channel 4 main channel in adult 16+ Share of Commercial Impact (SOCI) delivery and now closing in on Sky and Channel 5. The rise in adult 16+ SOCI every year since the Freeview launch in 2002 reflects not only UKTV's preparedness to invest more in content over time, but also management focus on EPG prominence on the free-to-air and pay platforms and unceasing willingness to try new channel ideas. The challenge now facing the UKTV group is how to maintain growth in an increasingly connected TV landscape. Innovative UKTV Play notwithstanding, the big question comes down to content strategy and the scale of future investment.UKTV has posted annual figures showing record revenues of £278 million in 2013, with the promise of more to come after an H1 2014 that has seen it overtake Cha [...]
July 31, 2014 Reports
In second of a two part report examining the current state of the UK consumer magazines sector we focus on magazine brands' prospects in the rapidly evolving digital and mobile landscape. Mobile presents a particularly fundamental challenge to magazines, but should also act as a spur for publisher innovation; we assess the degree of digital engagement from publishers thus far and consider the risks in ecommerce and opportunities in video. We look in detail at Good Housekeeping's digital transformation strategy to be rolled out in the second half of 2014, which combines digital utility solutions with bold innovations in its heritage brand. More publisher experimentation is a pressing necessity; the industry appears to have stalled on digital innovation and new competitors such as Houzz and Wiggle are occupying the digital ground in traditional magazine territory.
In second of a two part report examining the current state of the UK consumer magazines sector we foc [...]
July 30, 2014 Reports
In the first of a two part report examining the current state of the UK consumer magazines sector we focus on the performance of print as paid circulation decline accelerated, down 10% year-on-year in 2013. We consider the display advertising performance of both consumer and B2B magazines across print and digital and provide forecasts through to 2017. While print display advertising decline in consumer magazines accelerated to 8% in 2013, digital growth was 12%, and digital advertising is now 15% of total display revenues. The market is increasingly diverging between rapidly declining titles and differentiated (often high value) titles with older readerships where circulation falls have been less severe. We expect this gap to continue to widen as an improving economy provides some respite for stronger titles over the next two years.
In the first of a two part report examining the current state of the UK consumer magazines sector we [...]
July 13, 2014 Reports
The UK's love affair with mobile devices continued in Q1 2014, with four times as many smartphones and tablets as PCs shipped during the quarter. Smartphones now account for three quarters of mobile phone sales, and shipments of tablets exceed sales of PCs, though the latter improved during the quarter. The device mix for internet access is changing rapidly: more people now have a smartphone than have a laptop in the home, though the overall PC audience (including desktop) is still larger. For many people, smartphones are becoming the core device to get online, and almost half of all households have a tablet. Commercial revenues derived from mobile devices still trail their share of internet usage but the gap is closing: in Q1, smartphones and tablets generated a third of e-retail sales, while mobile ads represented a fifth of internet search and display advertising.
The UK's love affair with mobile devices continued in Q1 2014, with four times as many smartphones an [...]
June 19, 2014 Reports
Amazon has announced a new smartphone, the Fire Phone a premium-priced device with some unique features and solid hardware; only available in the US at first, its high price and small number of apps limit its appeal. Although initial sales are likely to be low and mainly confined to Amazon Prime members, in the short term the purpose of Fire Phone is simple: to drive increased mobile sales of everything Amazon sells. In the longer term, Amazon needs to avoid being locked out of digital media purchasing on smartphones, increasingly the primary connected device this is a first, although insufficient, step in that direction.
Amazon has announced a new smartphone, the Fire Phone a premium-priced device with some unique fea [...]
May 5, 2014 Reports
At its f8 developer conference, under the slogan Build, Grow, Monetise, Facebook rolled out a slew of new policies and initiatives designed to boost its appeal amongst users, app developers and advertisers. In its drive to encourage developers to build more apps that support the social network, Facebook is attempting to position itself as a cross-platform platform with 1 billion+ users that sits on top of iOS, Android and other mobile operating systems. Key announcements included App Links, an open source solution enabling linking across apps, which may drive additional usage, and Facebook Audience Network, an app ad network rolling out this year, which should drive additional margin and could challenge Google AdSense.
At its f8 developer conference, under the slogan Build, Grow, Monetise, Facebook rolled out a sle [...]
April 27, 2014 Reports
Facebook has successfully transitioned its business to mobile, with the number of mobile users now exceeding those on PC, and mobile newsfeed ads accounting for nearly all revenue growth and over half of total revenue, now on a $10 billion annual run-rate. North America and Europe continue to account for the vast majority of revenue and revenue growth, despite flat audience penetration in both regions, as increasing mobile consumption and advertiser take-up have driven sharp increases in ARPU, particularly in the US. Despite tougher comparables and declining desktop revenue going forward, the rapid ramp up in mobile ad revenue, plus initiatives such as video ads, ads on Instagram and planned mobile ad network, should deliver strong growth through 2014 and into 2015.
Facebook has successfully transitioned its business to mobile, with the [...]
April 21, 2014 Reports
The boom in mobile device sales accelerated in 2013, with more than four times as many smartphones and tablets as PCs shipped in the UK: smartphones accounted for three quarters of mobile phone sales, and shipments of tablets surpassed PC sales, which fell sharply. By 2020, we forecast that smartphone penetration will rise from two thirds of the population to over 80%, and the number of tablet users will exceed 60%, outstripping the PC internet audience, which we expect to shrink. We now predict that the majority of internet usage will go to mobile devices this year and three quarters by 2020. Mobile is well on its way to becoming the predominant access platform in the UK, as in the US, and most, if not all, future growth in commercial internet revenues will be driven by mobile devices.
The boom in mobile device sales accelerated in 2013, with more than four times as many smartphones an [...]
April 1, 2014 Reports
Newspaper apps have very quickly become a critical means for publishers to optimise consumer dwell time in digital, and cement an integrated digital subscription service. In common with apps in other markets, they are evolving, with new business models and usability solutions emerging relentlessly, while challenges including mobile advertising and the integration of video with text-based content are far from resolved. Unsettled consumer discovery and interaction, and continued innovation by platforms and services on top, provides a mercurial environment for publishers, bringing opportunities for specialist and leading services that develop agile iterations, and increasing the existential threat for many others.
Newspaper apps have very quickly become a critical means for publishers to optimise consumer dwell ti [...]
March 14, 2014 Reports
Strong growth in UK sales of mobile devices in 2013, with tablet shipments overtaking declining PC sales, pushed smartphone and tablet penetration up to about 63% and 35% respectively, in line with our forecasts. We estimate that mobile devices now account for 50% of time spent online in the UK, the lion's share via apps, reaching this milestone sooner than expected. Mobile internet usage looks set for further growth in 2014 and beyond, with PC-based consumption flattening. After a slow start mobile monetisation is also rising fast, with UK advertising and e-commerce to mobile devices accelerating and closing the gap with that on the PC. We expect much, if not all, future growth in commercial internet revenues to be driven by mobile devices.
Strong growth in UK sales of mobile devices in 2013, with tablet shipments overtaking declining PC sa [...]
March 7, 2014 Reports
Enders Analysis co-hosted its annual conference, in conjunction with BNP Paribas and Deloitte, in London on 4 March 2014. The event featured talks by 13 of the most influential figures in media and telecoms, and was chaired by Sir Peter Bazalgette. This report provides edited transcripts of the talks given by seven of those speakers: James Purnell, BBC; Dido Harding, TalkTalk; Nicola Mendelsohn, Facebook; John Paton, Digital First Media; Mike Darcey, News UK; Ashley Highfield, Johnston Press; Michael Comish, Tesco.
Enders Analysis co-hosted its annual conference, in conjunction with BNP Paribas and Deloitte, in Lon [...]
February 21, 2014 Reports
In an audacious move to minimise the risk of mobile social disruption, Facebook is to acquire leading messaging app Whatsapp for up to $19 billion, or $42 per user, or 11% of Facebook's current market cap. Messaging platforms are becoming the new social media, particularly for younger demographics, and while Facebook/WhatsApp will be huge in mobile, other services could still side-step into Facebook's territory. The price for WhatsApp may be justifiable to counter the threat, but Facebook has only bought one of many, and paying a full price may encourage the others; expensively buying every competitor does not feel like a long-term strategy.
In an audacious move to minimise the risk of mobile social disruption, Facebook is to acquire leading [...]
January 21, 2014 Reports
Explosive growth in take-up of smartphones and tablets means that the effective size of the internet will increase by several multiples within the next few years. This transformation in scale comes with a major change in character and operating dynamics, creating new opportunities and revenue streams. Twitter is unique amongst social apps: it gives new users a blank canvas in which they can (and must) create their own social network reflecting their own interests, hence building an Interest Graph', but onboarding new users remains a challenge. Revenue at Twitter is now on a $600 million annual run-rate, scaling rapidly since the introduction of native ads', and seems set for further growth: the key question is whether it can achieve breakout user growth and mass market scale.
Explosive growth in take-up of smartphones and tablets means that the effective size of the internet [...]
December 19, 2013 Reports
The UK national press remains a big beast' in UK media, selling 7.2 million copies every day, supplemented by 1.6 million free newspapers; however, the decades long decline in print circulation and advertising has accelerated once again with the take off of smartphones and tablets. Print still accounts for the vast majority of the nationals' income, though revenue continues to fall due to declining copy sales and the structural shift of classified ads to the internet; there is also growing evidence that display advertising is declining by more than volume losses in some categories. Digital is gathering momentum due to acceleration in digital advertising and a shift to pay models. In the UK, where print subscription levels are low, and home delivery lower still, publishers face the obvious challenges of digital transition and migration from a newsstand economy to a consumer relationship mindset.
The UK national press remains a big beast' in UK media, selling 7.2 million copies every day, suppl [...]
October 24, 2013 Reports
Our annual series of reports on expenditure on advertising in the classified verticals of jobs, property and autos, kicks off with an overview of the print-to-digital transition that has lifted the share of digital to close to 50% by 2012. The advantages of online for professional classified advertisers in relation to print include: national reach; measurability and tracking software; value-for-money for listings; dense user experience; and advertiser add-ons. Aside from the fragmented recruitment market, the UK's online classified marketplaces for property and autos are highly consolidated around one or just two suppliers. Second-tier property supplier Zoopla Property Group is slated for an IPO in 2014 or in 2015, and the sale will be helped by the buoyant housing market. An IPO of AutoTrader is also widely expected, amidst a more general recovery of transactions in the sector. Our recruitment segment analysis highlights the more positive trends in the labour market in 2013, which are to continue in 2014 and 2015. However, the online recruitment market is highly fragmented on the advertiser side due to the myriad of companies and positions being filled, also splintering the online market across a large number of job boards, aggregated by Indeed. On the jobseekers side, professionals are increasingly being drawn to LinkedIn or category-specific professional networks, attracting employer expenditure on recruitment advertising. LinkedIn is the single biggest online supplier in the UK and is also the more dynamic through network effects and price competition on listings. We project about 5-7% annual growth of expenditure on online recruitment to 2017, amidst a terminal collapse in advertising in print.
Our annual series of reports on expenditure on advertising in the classified verticals of jobs, prope [...]
October 24, 2013 Reports
Property is the second category in our annual series of reports on UK classified advertising, following Recruitment [2013-090] and with Autos to follow. Our Property market report analyses the key drivers in the communications marketplace for UK domestic property, notably transaction rates and house prices, but also substantial developments in government policy. We analyse the Estate Agent marketplace and drill down into expenditure patterns for property advertising across all media, and provide five year forecasts. In digital the competitive battle between Rightmove and Zoopla is heating up, and we analyse the implications for this in the next few years.
Property is the second category in our annual series of reports on UK classified advertising, followi [...]
October 24, 2013 Reports
Auto is the third category in our annual series of reports in UK classified advertising, following UK classifieds and recruitment category outlook [2013-090] and Property classified advertising [2013-091]. Our Auto market report analyses the key drivers in the communications marketplace for used cars, notably transaction volumes and pricing. Overall the auto market is reasonably stable, with new car sales picking up substantially in recent months, while used car sales are roughly flat. AutoTrader remains the big beast in the marketplace, having closed its print product and now focused on developing its digital services alongside its core search. Our report analyses media usage by Car Dealers, and provides five year expenditure forecasts.
Auto is the third category in our annual series of reports in UK classified advertising, following UK [...]
October 20, 2013 Reports
Apple's two new iPhones both secure its grip on the high end (for now) and extend a cautious toe into (slightly) cheaper waters. They will not deliver a step change in global sales growth, but should deliver solid performance. 9m unit sales at launch are impressive, but 200m updates to iOS 7 (double last year's figure) point to the continuing strength of Apple's ecosystem and its ability to deploy innovative new features. We continue to believe there is room in Apple's portfolio for a $350-$450 phone without weakening Apple's quality of experience or brand positioning, but this is clearly now off the agenda for another year.
Apple's two new iPhones both secure its grip on the high end (for now) and extend a cautious toe into [...]
October 15, 2013 Reports
Press display advertising fell 10% in 2012, and we forecast a slower decline this year (about 7%), as press benefits from the deluge of telecoms advertiser spend and the ongoing commitment of retailers to national newspapers and fashion and beauty brands to leading magazine. But structural factors are gathering pace relentlessly: circulation decline is accelerating in some categories and rate cards remain under pressure. Some smaller newspapers and poorly differentiated magazines face the possibility of an existential crisis in the next five years. Publishers able to embrace creative marketing solutions from an integrated digital and print platform will stimulate a more sustainable model in the medium term but this requires a more radical rethink than is commonly assumed.
Press display advertising fell 10% in 2012, and we forecast a slower decline this year (about 7%), as [...]
September 12, 2013 Reports
Microsoft dominated PCs and Nokia mobile phones, but both are irrelevant in the dominant model for tech in the next decade, smartphones and tablets. An acquisition may have been necessary, but by itself it solves nothing. Smartphones are now half of all mobile phone sales, and the 255m smartphones and tablets sold in Q2 2013 dwarf the 76m PCs sold. Microsoft now powers less than a quarter of all the personal computing devices being sold. Microsoft retains a leading position in enterprise and in console gaming. But if it cannot return to relevance in consumer, the strength of the whole business will suffer.
Microsoft dominated PCs and Nokia mobile phones, but both are irrelevant in the dominant model for te [...]
September 12, 2013 Reports
Global consumer expenditure on recorded music fell 4% in 2012 to $20.7 billion on the continued decline of sales of the CD and other physical formats to $12.3 billion in 2012, while retail spending on digital formats rose 8% to $7.1 billion. We predict the global market will turn the corner in 2014 and reach $22.4 billion in 2017. For 2012, we estimate the share of digital at 35% of retail sales in the top five markets of the US, Japan, Germany, the UK and France. In Japan, the rebound in CD sales and difficult mobile-to-internet transition reduced the share of digital in 2012 to just 15% of retail. For the other markets, sliding CD sales and digital growth continue to increase the share of digital in retail sales, with the US in the lead with 55% digital share. A key theme in 2013 and in our forecasts is the take-off in revenues from subscriptions to access services, both stand-alone and bundles from mobile carriers. Bundling leverages the personal, mobile and connected nature of smartphone music activity, reduces decision-making and price barriers, and is a more powerful driver of adoption than stand-alone offerings. At this point, we still expect ownership to remain more important than access in the market for digital music by 2017
Global consumer expenditure on recorded music fell 4% in 2012 to $20.7 billion on the continued decli [...]
July 31, 2013 Reports
Magazine consumption and advertising will be more affected by the explosion in mobile device ownership than they were by the desktop internet - classic magazine 'time' is being eroded. In addition to the ubiquity of free digital content, publishers are also challenged by the myriad of digital services that disrupt the extensive role magazines have long had in the discovery to transaction funnel. Opportunities exist for publishers and brands in the new ecosystem and their biggest challenges will be in harnessing the right skill sets and structuring operations for effective execution.
Magazine consumption and advertising will be more affected by the explosion in mobile device ownershi [...]
July 8, 2013 Reports
By the end of 2013 there will be more iOS and Android devices in use than PCs. Google is using Plus and Android to reposition itself to take advantage of this, extending its reach and capturing far more behavioural data. We believe a helpful way to look at Google is as a vast machine learning project: mobile will feed the machine with far more data, making the barriers to entry in search and adjacent fields even higher. For Google, Apple's iOS is primarily another place to get reach: we see limited existential conflict between the two. However, mobile use models remain in flux, with apps and mobile social challenging Google's grip on data collection.
By the end of 2013 there will be more iOS and Android devices in use than PCs. Google is using Plus a [...]