Facebook deal with LaLiga has stolen cable networks’ last trump card

Facebook will be the only platform to watch LaLiga live in the next three seasons in the Indian subcontinent.

On Friday 17 August, when the new season LaLiga Santander (Spain’s top tier football league) kicks off, viewers in Afghanistan, Bangladesh, Bhutan, India, Nepal, Maldives, Pakistan, and Sri Lanka will have to visit LaLiga’s official page or the pages of clubs on Facebook to watch the matches. All 380 matches will be shown on the social network only.

If Twitter starting live broadcasting NFL matches back in 2016 made the headlines for being the first, it would be the absence of social networks in covering high profile sport events that would raise some eyebrows, which hardly happens at all nowadays.

It isn’t even the first time that Facebook tied similar exclusive deals. In July it beat Beln Sports and Fox Sports Asia in a £200 million three-year deal to live stream the English Premier League in Thailand, Vietnam, Cambodia, and Laos. But that won’t happen until the 2019-20 season. So this new deal with LaLiga, though by no means ground-breaking, when LaLiga claimed the deal “a first-of-a-kind agreement” it is technically correct.

Despite Facebook telling Reuters “it’s not something that is a big threat to broadcast world”, the broadcasters, especially the cable networks will see it nothing but. It looks the trinity of breaking news, high quality entertainment, and live sports, that has traditionally been drawing viewers to the premium cable networks, are crumbling one by one.

Digital channels, in particular social networks, are becoming more and more important in news reporting and dissemination. According to the latest Pew Research findings, 93 percent of Americans get their news from digital channels, with Facebook alone serving nearly half of them.

On-demand streaming services like Netflix and Amazon, with their investment in original content dwarfing the budget of any conventional TV networks, are encouraging more cords being cut. A watershed moment was reached in the UK in July, when the combined subscribers of the three leading on-demand streaming services Netflix, Amazon, and Sky’s Now TV, overtook the total number of cable TV subscribers for the first time, according to Ofcom.

Prime sports have been the last strong asset to hold the ground for the cable operators, which is being eroded by deals like the current one. Amazon will show 20 Premier League matches in the UK from the 2019 season, breaking the duopoly of Sky and BT Sport. What’s more worrying for the Fox Sports and co in the recent Facebook deals is that the cable networks are completely shut out of the markets. They may justly feel worried.

When it comes to the consumers watching LaLiga in the subcontinent, there is good news and there is bad news. The matches will be shown for free and, at least at the beginning, will be free of ads too. Viewers can also choose to use Facebook on different devices.

However, if there is one thing that TV beats internet it is the reliability of signal. With 4G coverage far from nationwide in any of these countries, broadband connection becomes critical. On the latest worldwide broadband speed league table, the highest ranked subcontinent country is Sri Lanka at 81st position, with an average download speed of 5.84 Mbps. The lowest ranked among these eight countries is Afghanistan at 1.15 Mbps. Viewers could be left frustrated with the picture stopping when a striker is just about to pull the trigger.

Orange continues to bang convergence drum

Virgin Media might be struggling to live the convergence dream in the UK, though Orange doesn’t seem to be having any problems as it reports another positive set of results.

Total revenues for the first half came in at €20.2 billion, a year-on-year increase of 0.9%, while operating income grew much more favourable, an increase of 2.8% to €2.35 billion. While this might be the highest profit margin in the industry, Orange has continued to demonstrate it is building for the future investing another €3.36 billion in CAPEX, 16.6% of total revenues delivered over the six month period.

“The 1st half results showed accelerated growth across all the Group’s financial metrics,” said CEO Stéphane Richard. “Revenues grew in all our regions while the strong acceleration in the Group’s adjusted EBITDA, which rose 3.3% during the half, reinforced our strategy of differentiation on the basis of service quality and demonstrated our constant focus on operational efficiency.

“Our investment strategy in fibre and 4G is reflected in the sharp increase in our very high-speed broadband customer base. Orange now has 50 million 4G customers with 13 million in Africa, twice as many as a year ago. In fixed very high-speed broadband, the customer base continued to show particularly strong growth enabling us to reach 5.5 million customers, almost exclusively in fibre.”

Looking at the convergence strategy, the team reported an increase of 9% in convergent offers year-on-year, a total of 10.7 million customers, while the number of SIMs attached to these offers increased to 18 million. Orange often boasts about being the leading convergent player in Europe, and with numbers like these it is hard to argue otherwise.

Spain has continued to be a strong market for the business through this period, and following the conclusion of the spectrum auctions, it is looking to be in a solid position for the 5G race. During the auction, Orange Spain acquired 12 blocks of frequencies, paying €132 million, representing 60 MHz in the priority spectrum band to offer 5G services. Orange is now the only operator in Spain in reach a total of 100 MHz in this spectrum band, which it claims is essential for the development of the new ultra-fast mobile broadband technology.

Telefónica and Ericsson demo simultaneous 5G driving and streaming

Spanish telco group Telefónica got together with Ericsson and others to show how 5G will power the future car.

The novel part of this demo involved using 5G over the 3.5 GHz band to simultaneously control autonomous driving and content consumption. It used a EZ10 autonomous driving electric minibus supplied by EasyMile, containing an Ericsson 5G terminal and an infotainment platform from CarMedia.

On show was high data transfer capacity and ultra-low latency enabling the simultaneous streaming download of high-definition content; the creation of a work environment in the vehicle with virtual office applications and remote driving support based on the real time analysis and processing of the telemetry data sent by the autonomous vehicle.

“5G technology has much to contribute in the field of the connected vehicle,” said Javier Gutiérrez, Director of Strategy and Network Development at Telefónica Spain. “In addition to the download of multimedia content, autonomous vehicles generate up to 4TB of daily information from the information collected by the sensors, meaning that a high bandwidth is necessary for transferring this data in real time to the network’s edge and also an extremely low latency. All in order to jointly process the data received by the vehicles of a certain area and to proceed with decision making, thus increasing the security in vehicular environments.”

“By 2023, 20% of the world’s population will have 5G coverage,” said Jorge Navais, Commercial Director for the Telefonica account at Ericsson. “It will have an enormous impact in terms of user experience and the digital transformation of industries and cities. Ericsson has already signed 39 agreements to start 5G trials and for the development of use cases like the one we present today. With this demonstration, we take a look at the future and how 5G will enable autonomous driving, only one example among many possibilities. It also poises Ericsson and Telefonica at the forefront of Spain’s journey towards 5G.”

This demo was part of a broader Telefónica initiative called the 5G Technological Cities project that aims to bring 5G goodness to Segovia and Talavera de la Reina (this one was in the latter). The official line is that they will become ‘5G living laboratories’, which seems in keeping with some of the stuff happening in Italy too. While this sort of thing provides a nice bit of publicity for all concerned, real world dress rehearsals are probably an important way of working out what we’re going to use new technologies for.

Vodafone’s European fibre push continues with Spanish gigabit first

Vodafone Spain has finally unveiled its shiny new gigabit fibre offering, almost two years after starting work on it.

The announcement comes hot on the heels of the announcement of a €2 billion investment by Vodafone in fibre for Germany. At the end of 2015 Vodafone unveiled a network expansion programme featuring a bunch of European countries, including Spain. The announcement of availability, tariffs, etc indicates it’s work there is done.

The new Spanish services will be available to around 4 million sites on 25 September. Vodafone claims these will be the first to offer 1 Gbps in Spain, although real-life speeds remain to be seen.

As you can see from the tariff table below, Vodafone is putting a significant premium on the 1 gig service, charging €65 per month for the basic fibre (fibra) package, and between €82 and €106 for bundled fixed (fijo) mobile (móvil) and Vodafone TV. You even get a year’s worth of PlayStation plus thrown in!

Vodafone Spain fibre tariffs

 

Sky starts Spanish streaming service

Sky has loosened the reigns for potential customers in Spain, offering a month-by-month streaming service for the more cash conscious consumers.

For only €10 a month, following a month free trial, customers will be able to shows like The Walking Dead, Big Bang Theory and Grey’s Anatomy, as well as hundreds of films on demand. The product seems to be designed for those who desire flexibility, and is a bit of a different move considering its business model in other markets.

“Sky’s new service offers customers a great value, no-strings relationship with their favourite shows for just €10 a month,” said David Nuñez, Director of Market Development in Spain.

“With a simple and intuitive solution, whether it’s watching the latest entertainment live or via catch-up, having the choice of the latest TV Series or enjoying hundreds of box office smash hits, this new service offers something for everyone.”

One explanation for the new offer might be Telefónica’s decision to expand the distribution of its Movistar+ pay-TV platform to other European countries. This is very much the Netflix-streaming style model, and if Telefónica can do it why can’t Sky.

For Sky it offers an interesting entry point into new markets, but success will be limited for the moment if it does not start to spray the cash around. Sure, some of the shows which it does have the rights for are popular worldwide, but unless there is a specific content plan in place to more readily engage local customers, it might not be a successful venture.

“For Sky, the launch into Spain makes sense and represents a key stepping stone towards grandeur aspirations of being a pan-European provider of pay TV services,” said Paolo Pescatore of analyst CCS Insight. “It needs more subscribers and Spain has seen an explosion in multi-play as well as online video services over the last couple of years. However, it will need to invest heavily in the long-term to raise its profile and acquire key local premium content rights.

“This new product will provide further disruption to a competitive cut throat market. We expect Sky to forge partnerships with local telcos replicating a proven strategy seen in other markets including Germany, Italy and the UK.”

Perhaps there should be little surprise Sky has made a move to crack new markets. Recent financial results have shown the room for growth is limited in the more established markets, the UK for instance, and at least Spain offers Sky the opportunity to focus on its core competency of content, as opposed to other bets such as the MNVO venture in the UK.

If this launch proves to be a success it could become somewhat of a springboard for a pan-European streaming business model for Sky, though it will have to be ready with the readies. Netflix and Amazon have both shown the streaming model can work, but there is a need to invest big in original and local programming. Whether Sky is prepared to do this remains another matter, but it certainly presents an interesting opportunity for the team.