There was a time when mobile operators battled other mobile operators; television broadcasters would fight it out on screen; and landline telephone companies were something else besides.
But that picture is now blurred. On Wednesday, it emerged that Vodafone (LSE: VOD.L - news) is flirting with the idea of buying Kabel Deutschland (Other OTC: KBDHF - news) , a €6.2bn (£5.4bn) cable TV business in Germany.
The potential acquisition is not the first deal out of left field that the media and telecoms industries have pitched to investors in the past 12 months. Last year, BT (LSE: BT-A.L - news) ambushed BSkyB (LSE: BSY.L - news) by placing a £1bn bet on premium sports rights, which it will use to anchor a new television service due to launch later this year. And just last week, American cable giant Liberty Global (NasdaqGS: LBTYA - news) swooped on Virgin Media (NasdaqGS: VMED - news) , a company whose raison d’etre is television, but which also offers mobile and broadband. The battle lines have been redrawn.
Part of this is about companies looking for new ways to grow, but there is also another dynamic at play. The rising popularity of smartphones and tablet devices means that more and more consumers are watching television programmes or making video calls on their mobiles, and using their mobiles while they watch television. They hop from screen to screen, viewing the same sort of content on whichever device happens to be the most suitable at that moment, latching on to Wi-Fi services when they are available and roaming on 3G or 4G mobile networks when they’re not. TV companies, mobile operators and broadband businesses are all in the same competition.
Over the next few years, this “convergence”, as the trend is known, is expected to help drive the growth of online video, which already accounts for more than half of mobile internet usage.
Some broadcasters have already worked this trend to their advantage. Sky, for instance, is keeping customers loyal by offering them access to its television services while they are on the move, and charging them extra only if they want those services on more than a couple of devices. However, convergence has also opened the door for mobile operators to follow BT’s lead and start treading heavily on television’s turf.
It’s not hard to imagine that, the next time BT and BSkyB are bidding for Premier League football rights, they could find themselves matched up against Vodafone or one of the other mobile operators.
= We should be ready to hail the benefits of shale =
The potential upside from tapping the world’s shale oil has been highlighted in a new report from accountants PwC who believe it could hold massive benefits for the UK.
So far, much of the attention on the shale revolution gripping the US over the past five years has focused on the vast gas reserves it has unleashed on the market.
Natural gas prices have fallen from $13 a unit to under $3, as producers using the technique of “fracking” have swamped supply.
But eye-catching as the slide has been, it would be a mistake to let it mask the significance of shale oil, which is more difficult to extract than shale gas due to its larger molecule size.
As a result of the liquid supply from its shale reserves, US oil imports are forecast this year to fall to their lowest levels for over 25 years.
So far, so good for American industry, at least. But at PwC, analysts argue that shale oil production can spread globally over the next couple of decades.
The dividend from this, they believe, would be great. Increased shale oil production could result in oil prices that are significantly below those projected under current forecasts, they predict.
As energy costs drop, the burden of costs on consumers and businesses around the world would ease, meaning economies could grow more rapidly.
For the UK, the report puts the potential boost to economic output at as much as £800 per person over the next few decades. This acceleration would be driven by the global trend in oil prices, rather than hinging on whether or not the UK taps into its own shale reserves.
But the report also highlights that the significant shale gas resources which have been identified here could be a good pointer to how much shale oil is also to be found.
That represents a potential opportunity for further growth, which should be examined closely.
After all, if a global shale oil revolution does take place, depressing oil prices, that would hurt North Sea tax revenues. Tapping our shale oil reserves could soften, even wipe out, that impact.
Of course, there will rightly be concerns about environmental risks, as well as the reliability and safety of the processes involved. The UK is not America, boasting vast tracts of empty Texas countryside with more cows than people, where any locals that might object tend to be won over by a generous royalty system.
But on the upside, we have our own home-grown tradition of excellence in the oilfield services industry. That could leave us well placed to ride this new energy revolution particularly with the North Sea resources stuck in long-term decline and energy security a continual headache.
= Tough for Carney, but he has Everton in support =
So, Mark Carney is an Evertonian, a supporter of the blue footballing half of Liverpool. This should come as welcome news if the Bank of England’s new Governor can follow the Everton way in running the Old Lady, he won’t go too far wrong.
David Moyes, the Toffees’ much-admired manager, has managed to deliver success with modest financial backing. Carney will have to perform the same trick. And Everton’s ability to punch above their weight, while eschewing the cult of the ego, is a model worth following. As is a pragmatic approach of substance over style.
And while Aston Villa, the outgoing Governor’s favourite team, battle relegation, there are no such worries at Goodison Park. Which surely means a less stressed leader at the Bank.