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If you can’t beat them, join them: football and F1 team up with esports

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Across the road from the Chelsea Football Club’s stadium in west London, the Gfinity Arena is the UK’s first dedicated esports arena. With three separate stages and seats for 240 spectators, it specialises in holding competitions for the world’s most popular video games such as League of Legends.

In late October, the arena hosted a very different event — a digital Formula One race that allows the drivers to rev their engines from home. With fans also prevented from attending by the pandemic, the venue had been turned into a production studio that allowed 20 drivers to compete in a virtual Grand Prix that was broadcast live on Sky, the dominant sports broadcaster in the UK. 

Popular sports such as football or Formula One once looked on esports as a parallel world — a niche form of entertainment that did not impinge on their own franchises. But they have watched anxiously as esports has grown rapidly into a formidable new force: one that is able to retain the attention of millennials and Generation Z — those born after 1995.

Now they are looking to get in on the act. F1, the global racing series owned by US billionaire John Malone’s Liberty Media and the organiser of the event at the Gfinity Arena, is among the established sports groups that are leading a charge into professional video gaming. They are competing for the next wave of consumers, who increasingly look to esports for their entertainment. 

At stake are potentially billions of dollars in broadcasting and sponsorship, generated by a growing global audience for competitive gaming. Roughly 443m people watched esports in 2019, a 12 per cent increase on 2018, according to data provider Newzoo, the large majority of whom are under the age of 35. Esports athletes’ exploits are streamed by Amazon’s Twitch and Google’s YouTube, among other platforms, direct to consumers’ phones.

Participants compete in the 2017 F1 Esports Pro Series at the GFinity Arena in London
Participants compete in the 2017 F1 Esports Pro Series at the Gfinity Arena in London © Joe Brady/Getty
Julian Tan, head of esports at F1, says: ‘The very core of why we’re doing this [expanding into esports] is really about reaching out to a younger audience’ © Youtube/Formula 1

The pandemic has given traditional sports an even greater incentive to tap the potential of esports. Not only has the absence of fans from stadiums damaged their business models and left them searching for new revenue, but broadcasters such as Sky, which have been deprived of many of the sporting events they usually rely on, have been eager for fresh content. 

“One of the biggest barriers to gaming going mainstream has been the reluctance of broadcasters to put it on air. Covid-19 and the lockdown blew this sentiment out of the water,” says John Clarke, chief executive of Gfinity. “If you are a sports rights holder, you have a choice. Embrace the gaming culture and find a way to play in it authentically, or watch your audience get older and older.”

That message is echoed by some of the most powerful players in traditional sports. Andrea Agnelli, president of the Italian football club Juventus and chair of the powerful European Club Association, which represents the continent’s top clubs, warned last year that the sport had to evolve in order to compete with video games such as Fortnite.

“If we are not progressive, we are simply protecting a system that is no longer there, a system that is made of domestic games that will have little interest for our kids,” he said. 

The International Olympic Committee has also established relationships with the esports and gaming industries and has raised the prospect of esports becoming part of the games in the future.

Fans cheer at the 2019 Fortnite World Cup in New York. aXiomatic was among investors, including private equity firm KKR, which injected $1.25bn into Epic Games, the creator of Fortnite
Fans cheer at the 2019 Fortnite World Cup in New York. aXiomatic was among the investors which injected $1.25bn into Epic Games, the creator of the game © Johannes Eisele/AFP via Getty

With many competitions temporarily brought to a halt by national lockdowns in March, some traditional sports instead began to stage virtual tournaments. 

F1 has held virtual Grands Prix featuring former drivers, including 2016 world champion Nico Rosberg, and celebrities such as Liam Payne, a former member of the band One Direction. The English Premier League, the richest domestic football competition in the world, held an esports tournament in April, which was won by Diogo Jota, the real-life striker who now plays for Liverpool. The National Basketball Association, the North American league, hosted its own competition for real players. 

Investment is also flooding into esports teams and leagues from wealthy former athletes.

Jakob Lund Kristensen, founder and chief commercial officer of Astralis, an esports team that floated on Nasdaq’s exchange for smaller companies in December 2019, disputes the perceived competition between sports and esports. Instead he sees a wider battle that also draws in video streaming companies such as Netflix and music platforms including Spotify.

“We’re all fighting for leisure time,” he says. “We went from having cooking shows to MasterChef, we went from having dancing shows to Dancing With the Stars. Everything pinnacles to something competitive.”

‘Investing in generational change’

David Beckham is among the group of sporting stars to have moved from the pitch to the business world. The former England and Manchester United footballer is a part-owner of Inter Miami, the Major League Soccer team, having negotiated an option to buy a franchise for $25m when he joined LA Galaxy as a player in 2007.

He is also a 5 per cent shareholder in Guild Esports, a London-based start-up company that floated on the London Stock Exchange in October, raising £20m to fund the recruitment of professional gamers and teams. 

Juventus FC President Andrea Agnell: 'If we are not progressive, we are simply protecting a system that is no longer there, a system that is made of domestic games that will have little interest for our kids'
Juventus FC president Andrea Agnelli: ‘If we are not progressive, we are simply protecting a system that is no longer there, a system that is made of domestic games that will have little interest for our kids’ © Miguel Medina/AFP via Getty
Players are seen on a TV screen during the 2019 Fortnite World Cup in New York. One of the problems for potential investors in esports is that it is hard to quantify the size of the market
Players are seen on a TV screen during the 2019 Fortnite World Cup in New York. One of the problems for potential investors in esports is that it is hard to quantify the size of the market © Johannes Eisele/AFP via Getty

“[Esports] is a sector I’ve been monitoring for a while,” he said in October. “We are committed to nurturing and encouraging youth talent through our academy systems . . . and we want to be the number one esports team in the business.”

Institutional investors also believe in the business. Soros Fund Management, the investment company of billionaire philanthropist George Soros, bought a 3.6 per stake in Guild.

Mr Beckham, is the face of the company. Under his “influencer” agreement, he will promote Guild on social media and the company can use his name to build a global following in a deal that could net the ex-player a minimum of £15.25m over five years.

“If you have the right pipeline of talent, that brings the tribal loyalty that you have within a team,” said Mr Beckham, explaining his role in the venture. 

The idea is that esports teams will build the same level of loyalty among viewers as traditional sports clubs enjoy from their fans to attract revenues from sponsorship, merchandising and broadcasting rights.

“This audience is an advertiser’s dream,” says Carleton Curtis, executive chairman of Guild. “It is by far the most concentrated composition of Gen Z and millennials that most brands these days are going after.”

Mr Beckham is far from the first former athlete to invest in esports. Michael Jordan, who became a global brand thanks to his exploits leading the Chicago Bulls to six NBA championships in the 1990s, has bought a stake in aXiomatic, which holds a variety of esports investments, including games publishers, teams and coaching businesses. 

David Beckham, the former England and Manchester United footballer, says of esports: ‘If you have the right pipeline of talent, that brings the tribal loyalty that you have within a [football] team’ © Lindsey Parnaby/AFP via Getty
Chicago Bulls’ Michael Jordan dunks the ball. The team's former star has bought a stake in aXiomatic, which holds a variety of esports investments
Michael Jordan during his heyday with the Chicago Bulls. The team’s former star has bought a stake in aXiomatic, which holds a variety of esports investments © John Swart/AP

Axiomatic’s backers also include Peter Guber, who co-owns the Los Angeles Dodgers baseball team and the Golden State Warriors in basketball, and billionaire Ted Leonsis, who owns the Washington Wizards, a rival NBA team, and the Capitals in the National Hockey League.

The company was among investors, including private equity firm KKR, which in 2018 injected $1.25bn into Epic Games, the creator of Fortnite. 

Still, revenues remain small compared to sport’s big leagues. Team Liquid’s revenues are in the “double-digit millions”, according to Victor Goossens, co-chief executive of the esports gaming team, who moved to South Korea after finishing high school in 2002, slept on floors and lived on $300 a month to compete professionally in the StarCraft video game. 

These days, Liquid is owned by aXiomatic. “To invest in esports. You need to be willing to look a little bit beyond just the fundamentals of a company,” Mr Goossens says. “To invest in esports is to invest in generational change.”

‘Humans are fickle sometimes’

According to F1, the average age of its fans is 40. Only 14 per cent are under the age of 25, with another 30 per cent coming from the 25-34 bracket. “The very core of why we’re doing this [expanding into esports] is really about reaching out to a younger audience,” says Julian Tan, head of esports at F1. “The reality is that the younger generation are spending more time gaming.”

F1 is “very strategically positioned to exploit certain elements like the blurring of lines with reality”, Mr Tan adds, pointing out that a small number of esports gamers have transitioned into real racing. That cohort includes Igor Fraga, who has raced in esports and in Formula 3, one of the stepping stones towards an F1 career.

In October, Fifa, football’s world governing body, outlined plans for esports competitions with $4.4m in prize money up for grabs to “engage deeper with football’s next generation”. The Premier League has continued to arrange virtual tournaments.

However, some investors are wary about the rush to invest in esports teams, questioning their ability to build loyalty.

Football players hold an exhibition match to promote a new version of the EA Sports Fifa video game in Hollywood, California
Football players hold an exhibition match to promote a new version of the EA Sports Fifa video game in Hollywood, California © Mark Ralston/AFP via Getty

Damir Becirovic of Index Ventures, the venture capital firm, says the real prize would be finding the next top game publisher and developer. In esports, unlike the real world, it is possible to own the game itself. “We want to back companies that have technology at the core [and] when we think about a team it’s really humans at the core,” he says. “Humans are fickle sometimes.”

Established sports have built their intense followings over decades, proving the investment case in teams and leagues. By contrast, Fortnite, for example, was released just over three years ago.

“Will fans permanently transfer their allegiance and their dollars to the virtual teams [or the players who compete in these tournaments]?” asked Nick Train, co-founder of UK fund manager Lindsell Train, a major shareholder in Manchester United and Juventus, in a note to investors in August. “No.”

Industry experts believe there is only limited potential in promoting esport versions of traditional sports.

According to Remer Rietkerk, head of esports at Newzoo, League of Legends, which is published by Riot Games, along with Counter-Strike: Global Offensive and Dota 2 — both the work of Seattle-based Valve — are the three most watched live competitive esports on YouTube and Twitch, with a combined 845m hours watched in 2019. Fifa 19 languished in 19th with just 8m hours, with Fifa 20 adding just another 3m. Those numbers exclude well over 1bn hours of views for non-competitive gaming.

“Fifa is a good game, many people play the game but no hardcore esports fan will tell you, ‘I’ve been watching Fifa for years’,” says Carlos Rodriguez, a former League of Legends gamer and founder of the G2 Esports team, which counts McLaren F1 racing chief Zak Brown as a shareholder.

“[Established sports teams] are used to buying LeBron James or Cristiano Ronaldo and automatically selling millions of jerseys,” he says. “They’re not used to having to relate to the people.”

Mike Sepso, the esports veteran and co-creator of Major League Gaming, which is now owned by gaming company Activision Blizzard, says that younger fans want different types of content that is more digital and usable on mobile phones. The reliance of sport on television broadcasting is “not going to satisfy the incoming demand . . . for more content,” he adds.

Yet, says Doug Harmer, a partner at Oakwell Sports Advisory, it would be a mistake for sports to forget the lessons of the pandemic and cut spending on digital gaming to cope with the economic downturn. He says one of the advantages for traditional sports of investing in digital gaming is that it allows organisations to collect data about their audience that they can use to attract commercial partners.

The basketball simulation video game NBA 2K21
The basketball simulation video game NBA 2K21 © 2K21
Diogo Jota, the real-life striker who now plays for Liverpool, won the English Premier League's esports tournament in April
Diogo Jota, the real-life striker who now plays for Liverpool, won the English Premier League’s esports tournament in April © Premier League

“I can definitely see a long-term rationale for keeping up with esports initiatives and the crossover [with] traditional sports . . . whether that actually happens now or not remains to be seen,” says Mr Harmer.

One of the problems for potential investors in esports is that it is hard to quantify the size of the market. Some analysts warn that there is an element of hype in some of the statistics that are sometimes used by boosters — such as the claim that League of Legends viewership is bigger than the Super Bowl. 

“That was the big, headline-grabbing stat but when you get down to it they were comparing the average audience of the Super Bowl in the US versus total unique viewers of League of Legends around the world,” says Nicole Pike, YouGov’s head of esports and gaming. “It’s just apples to oranges completely.”

Newzoo estimates esports’s annual revenues globally at $1bn, but that does not include revenue made by platforms such as Amazon’s Twitch and Google’s YouTube from streaming esports. It is also hard to distinguish publishers’ gaming revenues from esports revenues, making it difficult to properly assess the industry’s size. Esports insiders say some gaming companies run their competitive gaming activities as a marketing cost to sell more titles.

Nicolo Laurent, chief executive of Riot Games, says that traditional sports have been too slow to see the potential in esports. He likens it to the so-called “innovator’s dilemma”, a reference to the influential book by Clayton Christensen, who described the risk to incumbents from failing to recognise threats to their established products.

“The incumbent is a little bit arrogant towards the newcomer, the insurgent,” he says. “When you realise the insurgent is actually doing something great, it’s too late.”



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Analysis

Huawei’s fall hits growth of Sony’s chip business

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Growth of Sony Group’s semiconductor business has slowed, reflecting a plunge in shipments of image sensors for smartphones to Huawei Technologies as a result of the US-China trade war.

Although Sony has avoided a fall in the volume of shipments thanks to orders from other Chinese smartphone makers, the recovery of earnings appears likely to be delayed until the fiscal year of April 2022 to March 2023 because of weakened demand for sensors for high-end smartphones.

As Samsung Electronics of South Korea, which is strong in processing sensors for midrange smartphones, catches up, Sony is halfway towards recapturing the smartphone market.

“We cannot achieve an earnings recovery in the year through March 2022,” said Terushi Shimizu, president and CEO of Sony Semiconductor Solutions, at a press briefing on June 3.

This article is from Nikkei Asia, a global publication with a uniquely Asian perspective on politics, the economy, business and international affairs. Our own correspondents and outside commentators from around the world share their views on Asia, while our Asia300 section provides in-depth coverage of 300 of the biggest and fastest-growing listed companies from 11 economies outside Japan.

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For fiscal 2021, the semiconductor arm of Sony Group expects its operating profit to decline for the second consecutive year to ¥140bn ($1.26bn). The projection reflects changes in the smartphone market structure resulting from the trade friction between the US and China.

Huawei had a global market share at the 4 per cent level in terms of shipments in the January-March period, according to US research firm IDC. With the US government banning the export of American technology to Huawei, the Chinese company saw its market share plunge some 14 percentage points from the same quarter of 2020, when it ranked second.

At the expense of Huawei, Samsung, Apple of the US and three Chinese smartphone manufacturers — Xiaomi, Oppo and Vivo — expanded their shares.

Changes in global smartphone market shares

Sony commands half of the global market for image sensors in value. Growing demand for high-definition smartphone cameras, and the trend of using two or more cameras in a smartphone in recent years, have enabled Sony to expand shipments to Apple and Huawei on the back of its advanced technology of producing high-end sensors.

With Huawei losing its momentum, demand for cutting-edge sensors for high-end smartphones has weakened. Sony thus increased shipments to the three Chinese smartphone makers which primarily manufacture middle- and lower-end phones. While sensors for such phones are each priced low, the makers demand improvements in image quality to attract consumers.

Samsung has set an eye towards capitalising on the “new normal” created by the trade friction between the world’s two largest economies, in a bid to recover its lost ground.

Samsung ships nearly 300m smartphones per year, most of which contain image sensors it produces on its own. While having stable demand, the company is strong at producing high pixel sensors used in midrange smartphones and is enjoying growing demand.

In the global image sensor market, Samsung, with a share of 20 per cent, is trailing Sony, with its 50 per cent share. With Samsung boasting microfabricating technology needed for high pixel sensors, Shimizu said, “We are actually falling behind as far as high pixels are concerned.”

But, he added, “we will add new value using technology cultivated in the field of high image quality.”

Terushi Shimizu, president and CEO of Sony Semiconductor Solutions, speaks at a press briefing on June 3 © Masaharu Ban

Samsung has a large number of manufacturing facilities, including those for memory chips and central processing units. Sony will spend ¥700bn on production facilities in its semiconductor business under a three-year plan through fiscal 2023, up 20 per cent from the preceding plan. But if the importance of microfabrication technology increases, Samsung may gain an advantage because of its greater leeway for investment, according to a research company.

Sony is also expected to take time before reducing its reliance on the volatile smartphone market. Although the company positions image sensors for automobiles as a growth market and keeps boosting annual sales by 50 per cent, the business is still small in scale. Collaborating with its “Vision S” prototype electric vehicle project, Sony plans to develop a high-performance sensor capable of detecting objects even in the dark and sell it to American and European automakers.

Sony will also challenge for a new business model. While Sony has engaged in the sale of image sensors, it is attempting to establish a recurring model of collecting fees on a continuous basis. Specifically, it will use a sensor equipped with data-processing functions of artificial intelligence it has developed. Data, therefore, can be processed both in the cloud and in the sensor so that the volume of communication can be reduced.

For example, the sensor can be used in a camera at a cashless payment retailer with no cash register and improve the performance of street monitoring cameras.

Sony’s AI image sensor has found its way into smart monitoring cameras the city of Rome will put into use in June to optimise the operation of buses by sensing congestion at bus stops or emit light to pedestrians walking through a red light.

Image sensors with data-processing functions of artificial intelligence, developed by Sony, are promoting the rise of new core semiconductors for smartphones (Photo courtesy of the company)

The semiconductor business centred on image sensors was positioned as an engine of growth when Sony was rehabilitating itself. In fiscal 2019, it contributed to Sony’s earnings, logging more than ¥1tn in sales and an operating profit ratio of 22 per cent to sales.

Sony Semiconductor has propped up the revival drive despite such difficulties such as damage inflicted on its local plant by a series of earthquakes in Kumamoto Prefecture in 2016.

While striving to address radical changes in the smartphone market, Sony Semiconductor is being tested for whether it can develop new growth sectors such as image sensors for automobiles and AI image sensors.

Cutting-edge semiconductors are also drawing attention from the viewpoint of national security as the government has drafted a policy of courting overseas manufacturers.

The procurement of logic chips has become difficult as even Sony farms out most of production to overseas manufacturers. Asked whether Sony Semiconductor will launch production, including a joint venture project, for stable procurement, Shimizu admitted to the difficulty of producing them on its own in terms of both technology and cost.

“Generally speaking, it is extremely meaningful to receive state support,” Shimizu said, suggesting the need for government financial assistance for production.

A version of this article was first published by Nikkei Asia on June 7, 2021. ©2021 Nikkei Inc. All rights reserved

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Kamala Harris takes heat handling knotty vice-presidential portfolio

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US vice-president Kamala Harris gave a widely panned television interview while visiting Guatemala this week. 

Asked why she hadn’t been to the US-Mexico border, where an influx of migrants is putting a huge strain on local communities, Harris first dismissed the question and said, “We’ve been to the border.” Pressed, she laughed and said: “And I haven’t been to Europe.” 

Her comments drew criticism and underscored the political dangers that the number two official in the White House faces as she juggles a cumbersome, and expanding, policy portfolio.

Harris was in Central America as leader of the Biden administration’s response to the border problem, including the thorny question of how to address migrants fleeing north from the troubled countries of Guatemala, El Salvador and Honduras.

She has also been handed the nearly intractable task of shepherding contentious voting rights and police reform legislation through a sharply divided Congress. She has hit the road to sell President Joe Biden’s sweeping infrastructure plans. In addition, she has also taken an interest in black maternal mortality and other racial equity issues, including tackling vaccine hesitancy among African-Americans. 

Harris’s first foreign trip as vice-president exposed what detractors and allies alike say are her shortcomings as a politician and vulnerabilities should she run again for president. Harris, a former senator from California, abandoned a floundering primary bid for the White House in late 2019. 

Her comments earlier in the week to NBC News sparked outrage, particularly from Republicans who are hammering the administration over migrants. Meanwhile, she took flak from fellow Democrats for urging migrants not to come to the border in the first place. 

Mary Anne Marsh, a Democratic strategist, pointed to the vice-president’s failure to effectively convey her message on the trip.

“If this is your debut as vice-president on the international stage, you want to give your best performance, and she certainly can do better,” Marsh said. 

Harris made history at her January swearing in, becoming the first woman, the first black person and first Asian-American to serve as vice-president. She holds outsized power as the tiebreaking vote in a Senate evenly divided between Democrats and Republicans. But the other duties of a vice-president are less clearly defined. 

People close to the administration say that Harris has proven a deft counsellor to the president and a near constant presence at the White House, attending regular briefings, offering Biden advice and appearing at his side for big speeches. 

Biden himself served as vice-president under President Barack Obama from 2009 to 2017. When he announced Harris as his running mate last summer, he said he hoped that she would provide advice as he did to Obama. 

“When I agreed to serve as President Obama’s running mate . . . he asked me what I wanted most . . . I told him I wanted to be the last person in the room before he made important decisions,” Biden said. 

He added: “That’s what I asked Kamala. I asked Kamala to be the last voice in the room.” 

Harris is hardly the first vice-president with difficult assignments. Most recently, Mike Pence, Donald Trump’s vice-president, headed the White House coronavirus task force. 

“The vice-presidential tasks are such that usually, if you are successful, they become the president’s and the administration’s accomplishments. If you are unsuccessful, they become yours,” said Kenneth Baer, the founder of consultancy Crosscut Strategies. He was a speech writer for vice-president Al Gore in the Clinton administration and Gore’s ill-fated 2000 presidential bid. 

Harris supporters contend that her challenging portfolio only underscores the faith Biden has placed in her.

“Any one of those issues would be a full-time job for most people,” Marsh said.

Many Democrats argue Harris faces undue criticism, from Republicans in particular, given her identity as a woman of colour. But others admit she made missteps in Latin America and say that her refusal to correct course — Harris later had a frosty exchange with a Univision TV anchor about the border crisis — only remind people of her shortcomings as a presidential candidate in 2019.

“What I think you have seen in the past few weeks . . . are some of the issues you saw during the campaign,” Marsh said. “At different points during the campaign, she did not perform particularly well. Other days, she was spectacular.” 

Looming over Harris’s term is the political future of Biden, who is 78. Her allies say that she is focused on supporting the president as he seeks to push through his legislative agenda ahead of the 2022 midterm elections, when control of both chambers of Congress will be up for grabs. Next week, as part of her voting-rights remit, she will meet state legislators from Texas, where Democrats recently blocked a state bill that would have restricted access to the ballot box. 

“There is a sense . . . that she is focused on her future as opposed to the job, and I just don’t think that is true,” said Dylan Loewe, a former speech writer for then-vice-president Biden who also ghostwrote Harris’s memoir. 

“The last thing that she wants for her future presidential campaign, whenever it is, is for the storyline to be that she was focused on the future and not the president, and that she was not the same kind of vice-president to Joe Biden as Joe Biden was to Barack Obama.”

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Big weddings may be allowed despite expected delay to lockdown easing

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Boris Johnson will consider proposals to allow larger weddings to go ahead in England, despite a likely delay to the June 21 easing of England’s lockdown.

Speaking at the G7 summit in Cornwall, the UK prime minister said the government would be cautious in its approach to ending lockdown restrictions, which senior Whitehall officials said would be delayed for four weeks.

“What I can certainly say is we are looking at the data, continuing to do that, but what you can certainly take is . . . the road map was always cautious but irreversible and in order to have an irreversible road map, we’ve got to be cautious,” he told the BBC.

Johnson will meet senior ministers on Sunday to sign off on an expected delay to the easing due to the spread of the Delta variant of Covid-19.

But ministers may still sign off on plans to allow larger weddings to go ahead. Those with knowledge of the proposals say they will mirror those currently in place for funerals. 

Indoor celebrations will be allowed up to each venue’s Covid-secure capacity, which means social distancing and masks would be required. 

Outdoor celebrations would have an overall cap, which could be 100 attendees. One person familiar with the proposals said: “It’s a completely arbitrary number and I have no idea how it would be enforced.”

Chart showing that roughly 15 million adults remain unvaccinated in England, including around two million over-50s

One senior Whitehall official said it was unclear whether the plans would be signed off. “Boris hasn’t decided but he will do it if it won’t harm the Covid situation.”

The delay to the lifting of coronavirus restrictions in England for a month comes after the prime minister’s chief medical adviser pressed him to postpone the move following a surge in Covid-19 cases.

The restrictions were meant to be removed on June 21, but Chris Whitty, England’s chief medical officer, has advised Johnson that a four-week delay to the final stage of the government’s lockdown easing plan was needed, stressing that a shorter delay would be insufficient to control the spread of the virus. Johnson is due to make an announcement on Monday.

The expected delay would come as the NHS races to vaccinate more adults amid a sharp rise in Covid-19 infections and hospitalisations across the UK due to the coronavirus variant named Delta. Almost 15m adults in England remain unvaccinated, including 2m people aged over 50, according to Financial Times analysis.

Nine in every 10 new Covid-19 cases are the Delta variant, according to a Public Health England report released on Friday.

PHE data also indicated Delta, first identified in India, is 64 per cent more transmissible than the previously dominant Alpha variant that originated in Kent.

Chart showing that cases are rising steeply in England, and hospital metrics are now also accelerating upwards. Deaths so far show no sign of a sustained rise

With two doses of a coronavirus vaccine showing good protection against infection from the Delta variant, the government is seeking to get more jabs into arms. Currently, 55.4 per cent of the adult population has had two doses.

Johnson was given data on Thursday that outlined the latest analysis of the Delta variant and its potential impact on the NHS. “It is now critical we double jab everyone as quickly as possible,” said one official.

One Cabinet Office insider said: “A delay [to lifting the final restrictions] is the only sensible course of action. It’s our working assumption. The latest modelling is dire and it would be suicide to go ahead with a full easing.”

The government’s medical advisers have modelled the impact of a four-week delay on vaccination levels, concluding that a smaller postponement would not make much difference.

But they believe four weeks would have a substantial impact by increasing the number of adults fully vaccinated with two doses, as well as giving more younger people at least some level of protection from a single jab.

Chart showing that England’s current surge in cases has a much younger age profile than its second wave last autumn, which should make it less lethal

The UK has recorded the highest weekly rate of Covid-19 cases since early March, with 45,895 new infections reported in the past seven days. This is a rise of 58 per cent on the previous week.

Office for National Statistics data showed the infection rate was highest in the north-west of England and among children of secondary school age.

Covid-19 hospitalisations have risen sharply since the Delta variant became dominant, with 884 beds occupied in England on Friday, up from a low of 730 on May 22. They have increased 9.8 per cent over the past week.

The link between cases, hospitalisations and deaths has not been broken by the vaccines, but data suggest it has weakened significantly.

More than half of the 42 people who have died after being infected with the Delta variant were unvaccinated, according to PHE.

With older people much less likely to be infected now due to vaccination than in the infection wave last autumn, the fatality rate is likely to be 75 per cent lower amid the latest surge in cases, according to FT analysis.



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