IABM Market Intelligence Blog - B&MT profits continue to decline while market consolidates furer

IABM Market Intelligence Blog - B&MT profits continue to decline while market consolidates further 19 February 2016

IABM Market Intelligence Blog

Written by IABM Research Analyst Lorenzo Zanni (lorenzo.zanni@theiabm.org)

Broadcast and media technology (B&MT) companies continue to show a worsening financial performance as the demand side of the industry moves to a multi-platform delivery world. The shift in technology spending by end-users has been the subject of a previous Market Intelligence blog, where we summed up the main trends in broadcast technology purchasing.

The January IABM Industry Index provides evidence of the slowdown in sales and profits. Profits are now declining at -1.8%, the first negative figure since May 2014. Sales are growing more slowly in the overall market with SMEs' revenues now falling at -3.4% (See chart below). The gap between large and small companies is widening with larger businesses now outperforming the overall market average.

The turbulence in the market is mirrored by recent M&A trends. Large companies in the industry are focusing their investment in key market segments to keep pace with technology change in the sector. These strategic acquisitions aim to reinforce companies' expertise in areas such as analytics, personalisation and multi-platform delivery.

Some major end-users are also betting on small and innovative technology suppliers in order to ease their transition to TV Everywhere . In the UK, Sky plc has recently invested in Dataxu, a leading provider of programmatic marketing analytics software, and InCrowd, a company providing sports engagement technologies. Money is flowing to new generation technology suppliers with traditional equipment manufacturers threatened by the risk of falling behind.

We have dedicated a special discussion to market consolidation in our new Market Intelligence Quarterly Digest, which will be published before Cabsat 2016. The Digest will contain a wide range of business information about the broadcast industry and the wider global economy in a digestible way. This will enable member companies to keep up with the latest developments in our industry by bringing together disparate but useful sources of information in an orderly and relevant manner.

At Cabsat 2016, we will present the latest IABM Industry Index and discuss new developments in the broadcast and media technology industry and the Middle East & North Africa (MENA) region. We look forward to seeing you there. Click here to find out more about our activity at CABSAT.

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