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June 16, 2015Mary Meeker’s State of the Internet
ReportsWe have synthesised the key themes from the latest Internet Trends Report from Mary Meeker at Kleiner Perkins Caufield & Byers. We don’t purport this to be our own ideas, but provide it as an interesting resource (see below for Australian ramifications). Three key trends are evident to us from the report: the shift to mobile, the shift to a service economy and finally that disruption of traditional industries is likely to continue for some time yet.
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June 10, 2015
The evolution will be televised – assessing the SVOD impact
ReportsThe launch of three SVOD platforms heralds a new era in the Australian video market. Our proprietary survey of 5,300 consumers suggests there will be high adoption of SVOD with Netflix the early winner. We expect SVOD to have the highest impact on TVOD and Physical Media. The risk to Pay TV is real, but not game changing while the immediate risk to FTA is less apparent.
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June 5, 2015UK quarterly internet trends Q1 2015
ReportsThe latest numbers for Q1 2015 show strong device and internet user growth, with more of the population online than ever before, including more than 90% of under-55s. Growth amongst older groups, however, has slowed to a crawl. Participation in online activities is up across the board, but digital media data shows spend on ebooks and digital music struggling, with the latter being heavily impacted by the rise of unlimited streaming models such as Spotify. The story of mobile's surge continues, with almost a half of e-commerce transactions and a third of search and display ad spend now going to mobile. Most of these mobile devices are Android, but iPhone seems to have gained long term share with its larger phones. Google services, however, have cross-platform reach.
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June 2, 2015
Moneyball — Sports rights negotiations
ReportsSports remain critical for both FTA and Pay TV. We believe that Nine has the greatest capacity to pay for rights and will retain its NRL contract, albeit with lower inflation than Seven and Ten will face as they chase AFL rights. We expect Foxtel to retain its Pay rights (possibly increasing its tally of NRL games per week). -
May 13, 2015Video games: buoyant year ahead
ReportsThe Game Developers Conference (GDC) and Mobile World Congress (MWC) saw major announcements in virtual reality and new generation streaming game consoles, as well as further opening up of access to game engine software. Latest earnings reports show that major publishers and developers are currently in buoyant form as growth in the PlayStation 4 and Xbox One install base boosts revenue and consumers migrate to digital sales. Results for developers dependent on the mobile or online ecosystem are more mixed: King (producer of Candy Crush) continues to grow, but Zynga is struggling, although recent performance hints at a possible halt in its decline
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April 27, 2015Media & Telecoms: 2015 & Beyond slides
ReportsEnders Analysis co-hosted its annual conference, in conjunction with BNP Paribas and Deloitte, in London on 17 March 2015. The event featured talks from 13 of the most influential figures in media and telecoms, and was chaired by Sir Peter Bazalgette. This report provides the accompanying slides for some of the presentations.
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April 27, 2015
Media & Telecoms: 2015 & Beyond
ReportsEnders Analysis co-hosted its annual conference, in conjunction with BNP Paribas and Deloitte, in London on 17 March 2015. The event featured talks from 13 of the most influential figures in media and telecoms, and was chaired by Sir Peter Bazalgette. This report provides edited transcripts from some of the talks, and you will find accompanying slides for many of the presentations here. Videos of the presentations are available on the conference website.
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April 20, 2015
GE 2015 update: Election and government outcomes
ReportsThere are still two and a half weeks of the campaign to go before polling day, but postal votes are already being sent out to voters and many have already made up their minds. We believe there is now a small range of likely seat outcomes, and therefore possible governments. Our central case sees the two main parties almost level on seats, resulting in a Labour minority government dependent on the support of the SNP and its allies (the Greens and Plaid Cymru). Slightly different outcomes are also possible, depending on the final size of the swing from the Conservatives to Labour in England and Wales, over which there is still considerable uncertainty. If Labour does worse than we expect, it could require the votes of the Lib Dems as well as the SNP; if it does better, it could require only Lib Dem votes. The upside case for the Conservatives is now that they win enough seats to make a minority government dependent on the support of the Lib Dems, DUP and UKIP possible. We think that scenario is now unlikely, but even if it were to occur, we think it would be very challenging to both knit those parties together and persuade the parliamentary Conservative party that its interests are best served by doing so. For these reasons, we think a government led by the Conservatives can now be all but ruled out.
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March 16, 2015Apple Watch: the next must-have device?
ReportsApple has provided more details on its smartwatch range, on sale from April, priced between $350-$17,000 to appeal to a wide range of would-be buyers and initially focusing on enhancing the iPhone through added convenience. The Watch is likely to develop quickly in the next few years, and has the potential to become an indispensable tool for managing payments, health data and identity, as well as controlling other connected devices. The company is laying the foundations for Watch to become a must-have device, but the case is still to be made and ultimately its success depends on a number of key groups and factors outside Apple’s control.
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February 18, 2015
Global recorded music 2015: Purchasing past its peak
ReportsConsumer expenditure on recorded music continued its decline in 2014 by about 6% to $18 billion, as purchasing of download-to-own (DTO) albums and singles passed its peak in 2013, adding to the ongoing decline in total sales of CDs that started a decade ago Streaming is now the only growth story left for the industry, and it has a global footprint, being embraced by developed and emerging markets alike, unlike purchasing The US phenomenon of rapidly rising revenues from ad-supported audio streaming services such as Pandora and music video streaming on YouTube is quite unique as other markets currently lack the potential for online advertising.
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February 9, 2015
Bigger than ever: Apple’s Q1 2015 results
ReportsThe iPhone 6 and 6 Plus drove Apple’s most extraordinary quarter ever, with the company’s position in the smartphone market improving on all fronts: explosive growth in China, rising market share in the US and a rising average sales price. By contrast, iPad sales continued to decline in spite of the iPad Air 2’s release, suffering from cannibalisation by the phablet-sized 6 Plus and saturation in developed markets. Apple has a strategy to revive sales, which may bear fruit later in the year. A slate of new products is coming this year, led in the spring by Apple Watch. The question is, will Watch be a significant new source of profit or just a way to protect the iPhone’s dominant position in the smartphone market.
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December 17, 2014
The General Election in May 2015: Context and potential outcomes
ReportsThe General Election in May 2015 looks to be one of the most unpredictable in living memory. A hung parliament seems the most likely outcome, but the likely government after May is still unclear. Whereas in previous elections there were at most three swings that mattered, between the Lib Dems, Labour and the Conservatives, in this one there are arguably 10 or 11. There has been a huge increase in complexity, which, along with the virtually neck-and-neck polls, is what makes the outcome so much harder to predict. In this report, we describe the context of this election, analyse the prospects for each party, and illustrate three possible outcomes of the election, detailing what would be necessary for each of them to occur, and what sort of government each of them would lead to.
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December 17, 2014Xbox One, PlayStation 4 and their uncertain future
ReportsOne year on from the launch of the latest generation of gaming consoles Microsoft and Sony remain locked in a high stakes struggle for dominance of the gaming industry, and longer term viability of the console category. Sony's PS4, which we estimate outsold Microsoft's Xbox One 3:1 in Q3, looks certain to win this round in a return to form for Sony following the relative disappointment of the PS3. Microsoft, struggling from missteps early in the Xbox One cycle, may have left it too late to catch up. The wider games market continues to shift to mobile and online gaming, as developers seek to exploit the vast installed base of connected devices. New console gaming experiences from Steam and Amazon may be the primary growth driver for controller-based gameplay.
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December 16, 2014
Online media services report (Ofcom PSB review)
ReportsOfcom released its third review of public service broadcasting on 15 December, focusing on "Public Service Content in a Connected Society". Enders Analysis assessed how online media services contributed to the provision of public service content over the course of the review period (2008-2013). This report represents a summary and key themes of our findings. Relevant media content is now available over the internet from a huge number of sources. As well as affecting how media content is distributed and consumed, the internet is changing the nature of content available and funding models. In a few genres, the internet is now ahead of traditional broadcasting, notably those in which interactivity is a major enhancement, such as music and education. In news and current affairs, online services often match television's output, arguably providing more breadth and depth, though accuracy and impartiality are less assured.
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December 16, 2014
Case studies: BuzzFeed, Vice, YouTube vloggers (Ofcom PSB review)
ReportsAs part of Ofcom's third review of public service broadcasting, Enders Analysis produced 12 case studies of online media services, examining how they contribute to the public service objectives. The full report and all case studies are available on the Ofcom website. Here we present three of those case studies: BuzzFeed, Vice, and the phenomenon of YouTube vloggers' producing content for young people. These represent sources of innovative content unlike that found in traditional media. The online services we assess attract younger audiences than traditional media, and also have a more flexible approach to monetising those audiences, relying on sponsorship, creative solutions and even events and book deals to capitalise on their brands.
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December 1, 2014
UK quarterly internet trends Q2 Q3 2014
ReportsThe shift to mobile continues, with the smartphone replacing the laptop as the device with the most users, although the rate of tablet adoption has slowed somewhat. This shift will change the online revenue mix, with mobile being better suited to content, native and video advertising than traditional display and search. Mobile devices also now account for the majority of visits to retail sites, and more than a third of spend online. We see large age-based differences across all internet activities, but the split is particularly significant for smartphone adoption and usage, with only a quarter of over-55s using smartphones, and only a third of those reporting downloading apps.
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November 7, 2014
Sky Deutschland delivers weak ARPU ahead of BSkyB takeover
ReportsThe Sky Deutschland platform, which will fall under BSkyB's control by mid-November, continues to post strong subscriber growth, thanks to steady gross additions and declining churn. However, average revenue per user remains flat year-on-year, and declined sequentially for the first time in over four years, raising questions about Sky's capacity to sustain the recent pace of total revenue growth. On current trends, cash flow break-even will not happen before the last quarter of calendar 2016, months before the possible price hike from a new domestic football rights auction. Meanwhile, deployment of Sky's connected TV services appears to be keeping OTT competitors at bay.
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October 20, 2014
The TV/digital advertising debate
ReportsIn the last few days we have spoken to key authorities in advertising in the US, UK and Europe. We have been exploring the critical debate: the degree to which TV consumption and TV advertising are shifting and will shift to digital. Recent media coverage has argued traditional TV business models could start to unravel in the medium term. We disagree.
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October 1, 2014
Privacy and the internet in the UK
ReportsUK consumers have embraced data-hungry services like Facebook and Google, but many also have concerns about privacy online; young people have a more positive view of the trade-off and know how to avoid targeted advertising. Businesses that are conscientious about consumers' data gain their trust, and the gap between trusted brands and the market as a whole may grow substantially in the future. Despite Edward Snowden's revelations on Big brother snooping', the UK Government has secured vast access to communications data without serious challenge to date.
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September 18, 2014
Indyref settled for now, Devo-Max ahead?
ReportsIn a huge victory for the Union, 55% of Scotland's voters said No thanks' to independence. The follow-up to the cross-party pledge on devolution shifts to London and will be dictated by the winner of the General Election on 7 May 2015; the Conservatives are aiming for a wider constitutional settlement for England to resolve the West Lothian question, while Labour will stick with a minimalist approach to preserve Scottish MPs. The 1.6 million votes for independence demonstrate the strength of the separatist movement; we expect the SNP to continue its mission, actively supported by the Scottish Government, and to renew its mandate for independence by winning the May 2016 election with a solid majority.
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September 15, 2014
Wrists and rewards: Apple’s announcements
ReportsApple has fulfilled its promise to roll out innovative new products this year, launching Apple Watch into the nascent wearables market and Apple Pay, a new mobile payments service, as well as moving the iPhone into phablet' territory. The larger-screened 6 and 6 Plus should revive growth in iPhone sales and ASP, as well as providing another variable to compete in the mid-tier handset segment; Apple Pay further enhances Apple's lock on its customer base. Apple Watch's likely impact is harder to discern; to date sales of smartwatches have been lacklustre but although Apple's offering is the most commercially viable yet, it still feels like a solution in need of a problem.
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September 14, 2014
Media in an independent Scotland
ReportsClaire 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.
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July 13, 2014
UK quarterly internet trends Q1 2014
ReportsThe 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.
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June 19, 2014
Putting out Fires: Amazon’s phone
ReportsAmazon 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.
