Mobile and Wireless Technology

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    June 10, 2021

    NBN’s SAU Discussion Paper: Putting the broadband market on a n [...]

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    The NBN Co’s 7 June Discussion Paper on a new wholesale pricing scheme will, if implemented, shift Australia’s broadband industry economics onto a new path. The timing is no coincidence. As the migration to the NBN concludes and NBN’s focus shifts from rollout to operation and upgrade, the pressures on RSPs will also shift. The move to a flatter wholesale price structure will reinforce trends to more straightforward product sets that we already see in the market for broadband services. And with the threat of migration churn receding, RSPs will have both the opportunity and the incentive to look again at retail pricing.
  • May 28, 2021

    AU video viewing forecast to 2030: The new normal emerges

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    In our previous reports, we have raised issues around ARPU pressure on mobile service providers and highlighted the importance of price as a driver of telecommunications buying. We have said that competitive intensity (along with aftereffects of COVID-19) will put pressure on ARPUs which in turn requires a strong focus on keeping costs under control to maintain profitability.
  • May 13, 2021

    Venture Insights AU survey 2021: Broadband market converges as NB [...]

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    In our previous reports, we have raised issues around ARPU pressure on mobile service providers and highlighted the importance of price as a driver of telecommunications buying. We have said that competitive intensity (along with aftereffects of COVID-19) will put pressure on ARPUs which in turn requires a strong focus on keeping costs under control to maintain profitability.
  • May 6, 2021

    Venture Insights NZ survey 2021: No end in sight for NZ mobile co [...]

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    In our previous reports, we have raised issues around ARPU pressure on mobile service providers and highlighted the importance of price as a driver of telecommunications buying. We have said that competitive intensity (along with aftereffects of COVID-19) will put pressure on ARPUs which in turn requires a strong focus on keeping costs under control to maintain profitability.
  • May 6, 2021

    ITV Q1 2021 results: Returning to 2019 levels

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    Total advertising revenues were down 6% year-on-year in Q1, but strong expected growth in Q2 should ensure H1 is on par with 2019, and up 26% on 2020 Coming into the first quarter of this year—following the strong end to 2020—there was little market visibility of TV advertising revenues due to the possible impact of Brexit on advertisers' supply chains, and of course the effect of the pandemic over the winter. ITV reported total advertising revenues down just 6% year-on-year to £402 million, with the market being stronger than previously anticipated. Perhaps of greater interest, however, is the outlook ITV gave for April to June, given the 43% total advertising revenue decline ITV experienced last year as a direct result of COVID-19. In contrast April was up 68% while May and June are expected to be up at least 85%. While these are certainly buoyant figures, it should be noted that this would mean H1 2021 would be on par with 2019.  
  • May 4, 2021

    Apple’s privacy rollout: A trial for regulators

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    Apple this week rolled out new restrictions on the collection of mobile user data by third-party businesses. From Monday, all apps submitted to the App Store must enable the App Tracking Transparency (ATT) program, which requires app owners to display an opt-in window  by default before tracking users across third-party sites: Apple says it will ban apps that offer users rewards for enabling tracking. Developers estimate that around 80% of users may opt out, upending advertisers' ability to follow high-value iOS users across multiple apps and services. This lucrative pool of more than a billion mobile users is more robust than ever, with Apple reporting a 66% jump in iPhone sales last quarter.  
  • April 29, 2021

    Deals not quite done: 5G spectrum auction final results

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    The main part of the second UK 5G spectrum auction completed on 17 March 2021, with the nature and number of blocks won by each operator decided, and we discussed the results and implications in End-of-line spectrum 50% off: UK second 5G auction results. This morning (27 April 2021) Ofcom announced the final results of the auction, which incorporates the assignment stage, i.e. deciding which particular blocks of very similar spectrum each operator receives, as well as announcing a proposed spectrum trade (still subject to Ofcom approval) between Vodafone and O2.  
  • April 29, 2021

    The push for OpenRAN: Careful what you wish for

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    The term ‘OpenRAN’ covers both the separation of hardware and software across different RAN (Radio Access Network, the 'last mile' of mobile networks) elements (essentially the boxes that sit next to the antenna, at the bottom of the antenna, and/or in a nearby exchange), and having open interfaces between these elements in a variety of configurations. If this is standardised (i.e. standardising the hardware/software split and the APIs), this would allow the 'mixing and matching' of different vendors within an operator's RAN; while many operators currently have more than one RAN supplier even within a single country, these are separated geographically, and on any given site equipment has to be replaced or upgraded (to 5G for example) using equipment from the original supplier.  
  • April 28, 2021

    Venture Insights AU survey 2021: Mobile buying and churn drivers [...]

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    Venture Insights performs an annual consumer survey on mobile service and handset purchases across Australia. It asks questions around willingness to pay, intentions to switch service providers and handsets, and key factors responsible for this switching. We also ask which service provider the respondents are switching to, and thus determine the service providers that will gain or lose from this churn. The survey shows that price remains a key driver for mobile purchasing, underlining the difficulty of maintaining price increases that would lift ARPUs. Price continues to drive interest in MVNOs, but we expect that the MNOs can at least defend market share through sub-brands like Belong and now GoMo and Felix.
  • April 15, 2021

    Venture Insights NZ survey 2021: Mobile media use and telco oppor [...]

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    Venture Insights performs an annual consumer survey on mobile media and mobile gaming across New Zealand (NZ). It asks questions around video streaming that consumers use, willingness to pay services, mobile gaming, and implications for 5G and telcos. Our latest survey was conducted in March 2021 with 1,009 New Zealand respondents, and the key findings have been presented here. The survey results show that there is a significant and growing segment of consumers using mobile to watch video services, including sport. The share of respondents that never watch mobile video has fallen significantly over the last year. Further, there is a persistent opportunity for telcos to upsell 5G services to both video viewers and gamers.
  • April 8, 2021

    Venture Insights AU survey 2021: Consumer interest in mobile medi [...]

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    Venture Insights performs an annual consumer survey on mobile media and mobile gaming across Australia. It asks questions around video streaming services the consumers use, willingness to pay for video streaming services, mobile gaming, and implications for 5G and telcos. Our latest Australia survey was conducted in March 2021, and the key findings are presented here. The survey results show that there is a significant and stable segment of consumers using mobile to watch video services, including sport, that remans unaffected by the impact of the pandemic. Further, there is a persistent opportunity for telcos to upsell 5G services to both video viewers and gamers.
  • March 25, 2021

    A worthwhile flurry of activity? Mobile towers companies in focus

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    • 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

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    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 4, 2021

    Telco Half Year Results Reflect COVID Impact: Updated Forecast

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    Telstra, Optus, TPG, Vocus, Aussie Broadband, Uniti and Superloop have all announced results for the December half, with COVID19 looming large.

    The impact of COVID19 significantly affected the results. But this also means that recovery from COVID19 as immunisation programs roll out in 2021 will have an opposite effect. In this report, we have picked up some key numbers from these result announcements, and have discussed what it means for these telcos themselves, the implications for the industry in 2021, and how these affect Venture Insights’ forecasts for the Australian telco sector.

  • March 3, 2021

    O2 :Trending nicely, outlook challenging

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    • All of O2’s operational metrics ticked up this quarter with service revenue growth, continued strong net adds and OIBDA growth particular highlights in spite of the end of O2’s Carphone Warehouse relationship
    • Next quarter will be hit by the prolonged lockdown and, in spite of an improving picture thereafter, there remain several challenges particularly lower in-contract price rises than peers and some pressure on MVNO revenues post Sky MVNO renegotiation
    • The merger with Virgin Media appears on track for a mid-year approval. O2 management will need to work hard to sustain their sharp operational focus at a time when merger integration and strategic question marks risk diverting much of their attention
  • February 22, 2021

    Vodafone: Leverage looms large

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    • 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
  • February 18, 2021

    BT: A bumpy road

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    • 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
  • February 2, 2021

    Still the iPhone company: Apple’s record pandemic year

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    Mobility 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%.

  • January 21, 2021

    Top 5 Telco Trends in 2021

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    2020 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:  
    1. Low end operator brands seize leadership in the consumer market
    2. Telco infrastructure comes into play as operators seek to monetise assets
    3. Government refocus on regional communications as nbn rollout ends
    4. Enterprise market shift as nbn disrupts the fibre wholesale market
    5. 5G comes into its own as handset availability surges and coverage expands
     
  • January 21, 2021

    (UK) Update 2021: COVID-19 and Mobility

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    • 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
  • January 15, 2021

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

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    • 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
  • 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 £2.7bn, 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