Prepared by 505604
A. Describe briefly the core activities of the company and its operations for the past year, relating these to developments in the industry
Introduction
Music Choice Europe Plc (MCE) is a small company, which has been listed on the London Stock Exchange for more than three years. The core product is the "provision of digital ... music programmes" via digital TV-channels (MCE Annual Report 2002). The channels are specialized in different styles and do not contain any commercial. On the screen of the TV can be seen only graphical design, but no video images. Normally their product can be bought together with other channels as part of a pay-TV package such as sky+ in the UK or Premiere in Germany, or through a cable operator.
Company Profile and Industry Belonging
As per 31st of December 2002 the company has more than 14 million subscribers and operates in Europe and the Middle East.
The turnover for 2002 is 9 525 000 GBP and has being increasing with 28.5 % on annual bases. (MCE Annual Report 2002)
The industry belonging of MCE is not as clear as it seems though. At the core, the company's main activity is the provision of music. However, because of the "strange" way they distribute it, the sales of the company are strongly related to the cable-TV and Pay-TV market conditions in general.
The digital-TV industry has been growing steadily over the years, for which I have analyzed MCE's operations. Moreover, as you will see, the major client of MCE - BskyB - has also had strong sales growth and for the 2002 they have increased profits of twenty percent. (BskyB Annual Report 2002)
This was partly beneficial for MCE because it did not suffer from the adverse trend in the music industry, as...