Sky sails on - 133,000 new UK broadband customers in Q1

Very strong results from Sky for the first quarter which now includes the more pan european focus of Germany and Italy (in anticipation perhaps of the potential digital single market).

Much was made at the time of the loss of Champions League rights in both the UK and Italian markets but in response Sky added 134,000 customers in UK with, if I have read this right, 133,000 taking a broadband package and 43,000 taking a TV package. Churn levels might have been expected to jump but stayed on trend at about 10%. As they might say to BT "take that sports lover".

It does not look like Sky engaged in insane levels of marketing spend to achieve this but perhaps that is hidden somewhere in the numbers.

On the specific point of the Champions League rights Jeremy Darroch commented "We've pretty much sailed on as we did in the fourth quarter". He also offered a view that the broadband customer adds had come from other operators not new entrants although suggested we wait for other results to come out in the next few weeks.

This is fascinating and raises a number of questions

1. Does this suggest that the Champions League has no real value to Sky in terms of customer acquisition and retention ? - Yes it looks like it which is not great news for UEFA but does explain why Sky did not try to outbid BT.

2. If so is the reverse true and will BT add relatively few customers as a result. - This is more complicated and will depend on the strength of BT's overall proposition but the quarterly results are out on the 29th October. Broadband penetration in the UK is at about 80% of adults so overall growth is possible without a positive impact from the Champions League.

3. Is this clear evidence that Sky has now diversified its offering via broadband, NowTV, Sky Store etc so much that it is no longer reliant on Premium Sports rights ? To old hands (& potential flat earthers) in the industry this is almost heresy but is starting to look accurate. Therefore is the current rights inflation in the UK of Premier League rights purely a result of competition between BT and Sky ?

This goes some way to explaining the relaxed attitude at Sky to widespread 24/7/365 content leakage via piracy. Content exclusivity is not what is was and the view is perhaps that consumers of pirate content are not ever going to be subscribers.

An alternative view is that due to the high levels of live piracy that exist in sport "exclusive" rights deals no longer have the power to create or shift a subscriber base.

Either way Sky have altered their offering so much that exclusivity of premium content is no longer the main driver but one of many drivers.

BT appear to be taking a more old school approach based on exclusive content  - so very interesting set of results on the 29th.

Anti-piracy group BREIN wins key battle in the protection of digital IP rights - pirates personal & banking details to be disclosed by infrastructure operators

One of the challenges facing groups attempting to protect their IP rights in a proportionate way is that when a pirate website is taken down, domains are cancelled or similar the individuals involved simply set themselves up again.

Up to this point the providers of web based infrastructure such as Google, Akamai, PayPal etc would not reveal the details of the operators even if services were cancelled. Some operators promote "absolute privacy" as a benefit of their services. Therefore the work done to close the operations down can appear to have little real impact unless the individuals concerned stop carrying out pirate activities for other reasons.

In fairness with the Snowden revelations there is no doubt that the protection of privacy is crucial and that data should only be provided in an approved and transparent way. However a balance needs to be identified between allowing companies and individuals to protect their property and the rights of individuals who are abusing that property to protect their anonimity behind a veil of privacy.

In the snappily titled C / 09/492 901 / KG ZA 15-1085  the case concerned the unlawful sale of a large number of pirate e-books via Google Play. Google agreed to remove the relevant app but would not reveal the identity of the people running the operation on the grounds of privacy.

Clearly the Court viewed this as  jejeune (naive,simplistic and superficial) and gave it both barrels as  outlined below (translated by Google translate) 

The judge commands Google to within 3 weeks of this judgment to the counsel of BREIN in favor of BREIN, the following information, to the extent that Google becomes available, provide with respect to the holder (s) of the Google Play Books Partner Center Publisher Account (s) from which books were uploaded under the Google Play Books URL (s) that BREIN has logged in its request removal of May 19, 2015 (Google zaaknr 76,488,000,007,259.), as described in the body of the indictment:

With regard to the Publisher Account:
a. subscriber information;
b. the IP address of the computer that the Publisher Account is created;
c. billing information, ie, mailing address and bank account number, bank name and name of the bank account;

In the case of the Google account that was used to create the Publisher Account:
d. the date and time the Google Account has been created;
e. the IP address of the computer that the Google Account has been created;
f. IP addresses of the computers that the user has logged into the Google Account;
g. The secondary email address and the specified first and last name specified for the Google Account;

this under the condition that the person concerned has not within 14 days of the date of this judgment to Google objection raised with the aim to prevent the provision of this information to BREIN;
2.5.
explains the order given under 5.1 enforceable, but only insofar as it relates to the provision of data relating to addresses, bank accounts and IP addresses within the European Union;

3.5.
hold any further decisions, pro forma until Saturday, December 12th 23:00 h to give and another version, which date will be the first party to the court in writing or a follow-session agenda must be desnodig forthwith with all relevant prevented from attending, or whether the case can be dismissed or canceled in writing.

This is a key step forward in helping rights holders to protect their IP in the digital age.

57% of people think that there is no need to subscribe to pay TV for sport due to the availability of pirate content

Piracy of live sport has been around for a while but really started to go mainstream in about 2009/10. As a relatively recent issue it is therefore hard to analyse and as is often the case in the absence of any decent information individuals and companies tend towards the version of the truth that suits them at the time.

Therefore to start the ball rolling and to try to get the beginnings of a picture of consumer attitudes towards sports piracy and the link with sport on Pay TV we started an online survey.

High audience pirate sites do not respond to DMCA style notices at all - as the video below clearly shows - but what impact does this really have ?

Only a few questions to keep people engaged and responses from UK, Sweden, Canada, Ireland and Germany. 60% of responses were in the 25-44 range with an even split across the other age ranges.

Amazingly 43% of those surveyed thought that the types of sites featured in the video above might be legal. This highlights the challenge of complex copyright laws and the effective job some of the search engines have done to muddy the waters (excuse for "Mannish Boy" reference).

The chart below shows solid awareness of the existence of these sites.

So what seems to be emerging is that the public are aware of sites in a "grey area" as they see it and that these sites are not impacted by DMCA style activity.

So what if this makes very little difference to the decision to subscribe or maintain a subscription to a relevant Pay TV service ?

Well as the chart below shows it does seem that with the prevalence of free alternatives the sport driven subscription decision for pay tv is getting tougher

 
We will keep our research activity going in this area and welcome any constructive contribution to this emerging debate.