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 [...]
September 10, 2013 Reports
Virgin Media and Netflix have agreed on a ground breaking trial that blurs the traditional distinction between pay-TV platforms and OTT services by permitting TiVo customers direct access to Netflix via their set-top boxes The deal promises to benefit both parties as Netflix enhances the Virgin Media content offer to its TiVo customers with minimal risks of cord-shaving, while availability on Virgin Media TiVo offers Netflix the prospect of incremental subscription growth The question is whether other pay-TV platforms will follow suit, including Sky with its competitive interests in film rights acquisition, but where the Netflix value to UK viewers is increasingly seen to lie in its TV content
Virgin Media and Netflix have agreed on a ground breaking trial that blurs the traditional distinctio [...]
August 20, 2013 Reports
Netflix H2 2013 results show continuing steady expansion in its domestic US and international streaming businesses, mostly towards the upper end of company guidance Netflix has always posed as a disruptor, yet there is nothing revolutionary in its business model or content origination strategy, while confidence in the future owes much to growing acceptance of Netflix as another channel outlet by incumbent content owners Although Netflix releases no international streaming data by country, there is some evidence to suggest it is edging towards two million in the UK; but is still on a tightrope as it races to add subscribers and revenues to cover its fast growing and somewhat shrouded content obligations
Netflix H2 2013 results show continuing steady expansion in its domestic US and international streami [...]
August 6, 2013 Reports
Reports of the death of the PC have been greatly exaggerated, but rapid adoption of mobile devices is changing how, when, where and why consumers access the internet. Over the next few years, we forecast that PC user growth will be limited to population growth, smartphone penetration will rise from two thirds currently to over 80% by 2020, and tablet users will converge to the same level as the PC audience. In addition, we project that overall internet consumption will nearly double by 2020, with PC-based usage declining before levelling out, and smartphone and tablet use increasing threefold. Of the traditional media sectors, we expect print media to be the most negatively affected by the rise of the mobile internet, with less impact on radio and TV viewing and advertising likely to be relatively resilient.
Reports of the death of the PC have been greatly exaggerated, but rapid adoption of mobile devices is [...]
August 5, 2013 Reports
A cheaper iPhone has been discussed almost since the original launch in 2007, but we believe costs have fallen and the market developed to the point that it now makes sense for Apple to offer a $200-$300 (unsubsidised) model. We see a positive but fairly small financial impact on Apple. The key benefit would be defensive: by extending the ecosystem and preserving iOS as developers' first choice, Apple would secure the whole portfolio. We believe a well-executed and distributed $200-$300 iPhone would sell double-digit millions of units a significant challenge to Android OEMs and Google. However, the US market's pricing structure might limit the impact there.
A cheaper iPhone has been discussed almost since the original launch in 2007, but we believe costs ha [...]
July 18, 2013 Reports
Recorded music retail sales in Japan were flat in 2012 at $5.8 billion on the unexpected bounceback of CD sales, amidst the ongoing collapse of mobile music sales
Smartphone adoption is driving up internet track sales, which topped mobile track sales in 2012, but the internet's price discount to mobile is squeezing track revenues
Japan will be dynamic in 2013 and beyond for access' subscription services, newly launched by Sony, J-pop label-backed RecoChoku, and carriers
Recorded music retail sales in Japan were flat in 2012 at $5.8 billion on the unexpected bounceback o [...]
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 [...]
May 28, 2013 Reports
Google Play, the digital content platform from Google for Android devices, has added a music subscription service to the sale of music, ebooks, videos and apps. All Access, available only in the US initially, benefits from integration in Google Play, the default storefront on Android smartphones and tablets (excepting Amazon's Kindle Fire). All Access isn't available on Apple devices, in the majority in the US, severely limiting its reach. Google's main objective with Google Play is to support the Android ecosystem and attract and retain Android device owners, and thus OEMs and developers. We expect Google Play to operate slightly above break even like iTunes.
Google Play, the digital content platform from Google for Android devices, has added a music subscrip [...]
May 23, 2013 Reports
As smartphones have grown in the UK, so has mobile use of social networks However, mobile messaging services that offer an alternative channel to Facebook have become almost as important Meanwhile analysis by smartphone platform shows that iPhone users continue to have a higher propensity to install and use apps than do Android users. Android skews young and lower income, and messaging apps in particular start as a means to save money (though they are now much more than that), but even in this category iPhone users appear to care more
As smartphones have grown in the UK, so has mobile use of social networks However, mobile messaging s [...]
April 29, 2013 Reports
The completion of digital switchover has left an equilibrium between the digital satellite, cable and terrestrial platforms that is not expected to alter significantly by 2020. The main anticipated change over the forecast period is pay-TV subscription take-up where the 50/50 split between pay and free TV households is expected to rise steadily to 60/40, or even 67/33 if we include more individually-, as opposed to household-, based OTT online services such as Netflix, LoveFilm or Sky's NOW TV. Most of the pay-TV subscription growth will occur at the lower end of the price range among BT Vision and TalkTalk customers, where the popularity and success of YouView will be critical in driving subscriber growth as TiVo has been and will be to Virgin Media holding its ground.
The completion of digital switchover has left an equilibrium between the digital satellite, cable and [...]
April 28, 2013 Reports
In January 2013, the US Federal Trade Commission (FTC) cleared Google of anticompetitive practices in its core search and advertising business a corresponding European antitrust investigation is pending, but looks set to take a (slightly) stricter stance on Google. The FTC's closing of the search bias investigation is key to Google's strategy to integrate and expand its general and vertical search products, such as its e-commerce channels Google Shopping and Google Maps, with direct positive revenue implications. The European Commission will most likely not impose search bias remedies later this year that significantly impact Google's current practices, and we therefore have a positive outlook on additional vertical search revenues materialising.
In January 2013, the US Federal Trade Commission (FTC) cleared Google of anticompetitive practices in [...]
April 28, 2013 Reports
Apple's numbers have got so good they're bad: after growing at over 50% for two years, relative revenue growth has, inevitably, slowed. The products remain very strong, and direct competitors continue to have little impact. (Apple's mobile phone market share has never been higher, for example.) However, the premium phone market itself, which the iPhone dominates, is at a potential tipping point.
Apple's numbers have got so good they're bad: after growing at over 50% for two years, relative reven [...]
April 10, 2013 Reports
Facebook has announced Home, an Android app that takes control of your phone, replaces the home screen with your Facebook newsfeed and relegates any competing social services to, it hopes, an afterthought. At launch, Home will be available to at most 20% of Facebook's mobile base. It is an interesting tool to lock in core users and drive up their engagement, but can only be part of Facebook's mobile strategy. Facebook has strong mobile user and revenue growth, but has not won' social on mobile as it has on the desktop, and competing services have drawn hundreds of millions of users. It is not yet clear Facebook will win, or even that there will be a single big winner.
Facebook has announced Home, an Android app that takes control of your phone, replaces the home scree [...]
February 6, 2013 Reports
Slides from the presentations by the following speakers at the Media & Telecoms: 2013 & Beyond conference on 15 January 2013: Anthony Wood, CEO, Roku Anne Bouverot, Director General, GSMA Thomas Hesse, Chief Digital Officer, Bertelsmann
Slides from the presentations by the following speakers at the Media & Telecoms: 2013 & Beyon [...]
February 6, 2013 Reports
Enders Analysis co-hosted its annual conference, in conjunction with BNP Paribas and Deloitte, in London on 15 January 2013. The event featured talks by 14 of the most influential figures in media and telecoms, and was chaired by Sir Peter Bazalgette.
Enders Analysis co-hosted its annual conference, in conjunction with BNP Paribas and Deloitte, in Lon [...]
December 17, 2012 Reports
Smartphones and tablets running iOS and Android will outsell PCs by more than 2:1 in 2012. There will be 1bn of these devices in use by the end of the year, compared to around 1.5-1.6bn. PCs The hardware business continues to polarise, with Samsung and Apple dominating revenue and revenue growth and most other branded manufactures looking distinctly sub-scale. Samsung and Apple are using their scale to cement their position. Though Apple and Android now dominate the smart devices market, it remains subject to massive uncertainty at every level, with almost all sectors and companies facing major, often existential challenges in the next year.
Smartphones and tablets running iOS and Android will outsell PCs by more than 2:1 in 2012. There will [...]
November 9, 2012 Reports
In Q3 the big four' US mobile operators sold 22.6m phones to retail contract customers (90% of the market): 80% were smartphones and 41% were iPhones The iPhone has had close to 50% of US smartphone sales every quarter since December 2011, when Sprint began selling the iPhone, and shows no sign of weakness US iPhone sales are supported by a market pricing structure that masks the iPhone's price premium
In Q3 the big four' US mobile operators sold 22.6m phones to retail contract customers (90% of the [...]
October 29, 2012 Reports
The linear TV broadcast industry has kept its oligopolistic structure remarkably intact over the last 50 years against a background of much technological innovation and re-regulation, but now faces a new wave of innovation that promises growth of non-linear at the expense of linear True disruption can only occur by solving the device challenge of developing on a mass scale new, compelling and innovative ways to access content, but so far non-linear has achieved a very small share of total viewing while linear viewing levels are as high as ever Although non-linear viewing may become substantial, it is unlikely to result in fundamental change in the distribution value in the industry
The linear TV broadcast industry has kept its oligopolistic structure remarkably intact over the last [...]
October 29, 2012 Reports
After selling 100m iPads in 10 quarters, Apple has entered the smaller, cheaper' tablet market with the $329 (£269) iPad mini. This is well above the $200 (£159) point hit by Amazon and Google, who are selling at cost, but we expect ecosystem and design to make it a bestseller
Tablets are still in price discovery: the iPad's US ASP has fallen from $610 to $505 since launch while Google and Amazon have found a market for smaller devices at $200. Apple is moving to extend its dominance and prevent competitors building a bridgehead in a new sub-segment
We expect further record sales of tablets at the new lower price points over Christmas, accelerating cannibalisation of the desktop web and print by tablets and apps, which take the web to the train, sofa and kitchen table
After selling 100m iPads in 10 quarters, Apple has entered the smaller, cheaper' tablet market with [...]
September 16, 2012 Reports
Apple has refreshed the iPhone with a thinner design, better performance and the addition of 4G LTE, returning it (arguably) to the status of the best phone on the market for 6-9 months, until competitors catch up again. Apple's choice of LTE bands gives Everything Everywhere a 12 month exclusive selling 4G speeds for your iPhone' in the UK, although given that the iPhone 5 also supports the latest enhancements to 3G, the impact of this will depend much on how well it is marketed. The iPhone retains a super premium price, with an ASP of $624 in Q2. Even the discounted 2 year old iPhone 4 is $450 before subsidy, while much Android growth is under $150. Apple is locking in the top 25% of the smartphone market and leaving the rest to Android, for now.
Apple has refreshed the iPhone with a thinner design, better performance and the addition of 4G LTE, [...]
September 2, 2012 Reports
Amazon, Nokia and Apple are expected to announce new mobile devices in the next fortnight. We outline the main products and features expected and their implications
Amazon, Nokia and Apple are expected to announce new mobile devices in the next fortnight. We outline [...]
August 30, 2012 Reports
A US jury has found Samsung infringed Apple's patents with Android products and awarded $1bn damages. This is 17% of Samsung's Q2 operating profit and would be crippling to any other Android OEM: it sends ripples of uncertainty through the ecosystem. We expect the verdict to accelerate IP licensing between Apple and other Android OEMs, with Apple (like Nokia and other IP holders) levying a fee per device, though Google's ownership of Motorola may mitigate this somewhat. However, major changes in the Android proposition are unlikely to be necessary, and as long as the iPhone ASP is $650 and Android is $300 or below, market share is unlikely to shift much. Absent a cheaper iPhone, Android will continue to outsell iPhone 3:1 at much lower prices, especially outside the USA.
A US jury has found Samsung infringed Apple's patents with Android products and awarded $1bn damages. [...]
July 5, 2012 Reports
YouView, the hybrid DTT/IPTV service backed by the public service broadcasters, is here, but with an initial retail box price of £300 it will be heavily dependent on the subsidies offered by ISP distributors BT and TalkTalk The TV market has evolved since YouView's conception in 2008, with many other internet-enabled options now available; its managed and integrated approach gives it some advantages but doesn't make it a must have' We expect YouView to mainly appeal to Freeview and BT Vision upgraders and project take-up between 1-3 million TV homes by 2015, though if the product improves and pricing falls dramatically it could see faster growth
YouView, the hybrid DTT/IPTV service backed by the public service broadcasters, is here, but with an [...]
July 4, 2012 Reports
Apple sold 67m iPads through March 2012, and retains over 70% market share for premium tablets. Apple is aiming for the same long term dominance it enjoyed with the iPod, which maintained similar market share for a decade Microsoft and Google are taking radical steps to try to change this. Both are now making and selling their own hardware, while Google will sell a tablet at cost Microsoft and Google now have coherent tablet propositions, but they remain far behind on broader app ecosystems. Like Nokia, they are now back in the game, but they still have to play
Apple sold 67m iPads through March 2012, and retains over 70% market share for premium tablets. Apple [...]