Deloitte TMT predictions

Deloitte recently announced its annual TMT (technology, media & telecommunications) predictions for 2016.

The professional services firm predicts that just 0.3% of all mobile device owners will use an ad-blocker by the end of 2016. Despite the benefits of ad-blockers for consumers (faster download times, which save data and battery life), only a small minority of the 3.4bn smartphones and tablets in use by the end of 2016 are likely to have ad-blocking capability built into their operating systems. That reduces the market for device-level ad-blocking. One of the barriers to adoption of ad-blockers is consumer inertia: for an ad-blocker to work, the user needs to download it and adjust the setting on the device. Deloitte expects most ad-blockers will be paid for, as free ad-blockers’ efficacy may be compromised by their use of “white lists” (approved sources of information).

Deloitte says it expects advertisers to redeploy ads to apps or websites not affected by ad-blocking rather than reducing their spending on mobile. It predicts that websites with minimal advertising and those with fast-loading advertising may be net beneficiaries of ad-blockers.

The report advises online publishers who rely on advertising for revenues to consider how best to enable easy payment for their content. It warns that mobile users may simply ignore mobile websites that have what they consider to be excessive advertising.

The report predicts that TV and cinema should continue to hold their own, even if they don’t see much growth in the year ahead. Box office revenue at cinemas is predicted to be relatively stable  though it is driven by the success of the year’s blockbusters.  Despite fears of an imminent collapse of the traditional advertising and subscription-funded TV model, Deloitte predicts that in the US TV is likely to erode at a slow, steady and predictable rate rather than imploding. TV is not growing at the rate it used to, but it’s far from dying or irrelevant. Pay-TV subscriptions are expected to fall in the US but remain in a growth mode globally.

Deloitte notes that football’s sponsorship revenue has been increasing consistently over the past few decades, fuelled by a global interest in the sport’s top leagues and clubs at many levels, from broadcast interest to shirt sponsorship and ownership. The report predicts that prospects for football look favourable as long as the sport maintains its ability to remain a spectacle that can attract the interest of a large proportion of the global population.

On the telecommunications front, Deloitte expects the used smartphone market to surpass $17bn this year in trade-in value, making it a significant consumer device market in its own right.

The big take-out: According to the Deloitte TMT predictions for 2016 there will be low take-up of ad-blockers in 2016, football is the sport to watch for its growth prospects and the used smartphone market is becoming a market in its own right.