Tech / Media / Telecom

Mr. Sagawa leads the Technology, Media and Telecom practices at SSR.  He has worked in and around the industries for over 20 years, including his 11 year tenure as a senior research analyst at Sanford C. Bernstein.  While at Bernstein, he was named to the Institutional Investor All-Star Team in three different categories, including the number one position in wire-line communications equipment after his prescient call in September 2000 noted that cash strapped telecom carriers would be unable to pay for technology purchase commitments and correctly predicted the subsequent collapse in the sector.  In his most recent position at Bernstein, Paul conceived and launched a new business area as the firm’s first Small Cap Equity Strategist. Prior to Bernstein, Paul spent six and half years at McKinsey and Company, rising to the position of technology sector specialist in recognition of his communications industry acumen.  His earlier experience includes three years as a sales representative for AT&T’s equipment business.  Paul earned his BA in Economics and MBA from Harvard University.

Coverage Universe

In order to understand dynamics at the sector, subsector and firm level, we monitor relative valuation and share price performance throughout technology, media and telecom. By tracking firms relative to their (cap-weighted) subsectors as well as subsectors relative to their sector and the broader market we are able to highlight high and low outliers, track variability in relative performance and steer our analysis to the most investable opportunities.  To do demonstrate this, we maintain and track quarterly model portfolios based on themes identified in our research. We typically add and remove constituents each quarter, and track performance between updates. Recent performance appears below.

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Recent Blog Posts

August 12, 2015 – Video Media: The Cord Cutting Myth Gets Real

The death of the multichannel cable bundle will take years to play out, but investors were reminded of its inevitability by the signs of erosion from even the best regarded media players. TV viewing is in decline. Pay TV subscriptions are falling. TV ad sales are down. Meanwhile, viewership is booming for NFLX and GOOG’s YouTube, as Americans are expressing a strong and growing preference for streaming on-demand video. The TV nets are coming late to the game, licensing linear streams to OTT players, like DISH, SONY and likely AAPL, offering skinny bundles online. We believe that the OTT bundles are unlikely to stem the tide toward on-demand streaming, damaging traditional media brands, and leaving them at a growing scale and data disadvantage in competing for creative content. Rising programming costs, particularly for live sports, will squeeze networks simultaneously suffering from top-line erosion. NFLX is the clear winner in subscription on-demand streaming, likely to continue its explosive sub growth with significant future monetization options. AMZN is best positioned to be number 2, ahead of TWX and its overpriced HBO Go. YouTube dominates the similarly fast growing ad driven, short-form video paradigm that it pioneered. We do not see FB as a threat to YouTube’s primary use cases, although its newsfeed has proven a robust channel for auto-play video ads. See more at our TMT blog

Research Archive

Registered clients can access the full-text of Paul Sagawa’s published research here. Recent work includes: US Telecom: Merger Mania! Telecom Bankers Rejoice! TMT: The Advertising Revolution Will Not Be Televised TMT: “Culture Eats Strategy for Breakfast!” eBay: Betting Big on the Future of Retail TMT: Don’t Rain on My IPO Facebook: Dream Until Your Dreams Come True SaaS: After the Levee Breaks – Competition in Software TMT: How the Mighty Can Fall Twitter: Out of the Nest, Into the Sky Smartphones Today: Looking High and Low Mobile Payments: From Cards, to Smartphones and the Cloud Mobile Devices: The PC-ification of the Smartphone The War on TV (4 part series covering set-top boxes, content, advertising, and service providers)  

Audio Archive

September 18, 2013: (Sagawa and Mason) Mobile Payments: Incumbents versus Innovators *Note audio files are secure, please contact your SSR sales rep for a login ID and password to access our research archive.

 

 

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