Brian Sullivan, CEO at Sky Deutschland, delivered “the most incrementally positive presentation so far” according to Patrick Wellington, lead media analyst at Morgan Stanley’s TMT conference in Barcelona on November 21st. The bank said that Sky-D will pass 4 million subs during 2014, and is increasingly comfortable about expecting more than 400,000 net new subs next year.
“SkyD remains convinced of the long term potential of pay TV in Germany and does not see why 50 per cent penetration should not be achieved (15 per cent presently),” reported the bank, in a note to its clients. “It anticipates a strong 2014 in subscriber additions getting the benefit of its churn reduction measures in 2013 feeding through into better subscriber growth and ARPU. The indicators on ‘intention to buy ‘ have strengthened in recent quarters. Sky will let the extra growth potential come through in 2014 and Mr. Sullivan is increasingly happy with net add forecasts of above 400k in 2014.”
“Longer term SkyD sees subscriber growth accelerating as a network effect of customer recommendation kicks in,” added the report. “The Champions League renewal is coming up but we think that by having partnered most of its potential rivals, SkyD may get a good result. SkyD will only bid what is commercially viable – this is not a strategic bid item. SkyD doesn’t rule out a left field bid but we observe that SkyD is now a partner of most of the potential alternate bidders (cable companies, DT, VoD) and is happy to distribute through these players, a very different situation from the UK. The most obvious potential competition for the rights is instead from the FTA side.”