Virgin Media (NSDQ: VMED) added just 5,100 new broadband customers between April and June on a net basis – down from 54,600 in the same period last year – despite the telco having launched 50Mbps and planning 200Mbps. On a gross basis, sign-ups were down 4.6 percent.
Neil Berkett’s Virgin is migrating its slower-speed customers up to its 10Mbps and 20Mbps packages and now has 3.74 million internet customers, but the capex-intensive roll-out of its DOCSIS 3.0 network that supports the higher speeds has coincided with the recession and the plateauing of the broadband market. It acknowledges sign-ups are down “due to our shift in focus towards growth in higher speed customers”. Broadband income still rose four percent to £3.98 billion.
Overall, the company turned Q208’s £328 million operating loss in to a £15 million operating profit, on basically flat revenue of £936 million. Customer churn held steady at 1.3 percent and average per-customer revenue rose 3.8 percent to £43.27 (at £519.24 a year, that’s more than the £512 a year Sky recently said it’s extracting from customers).
— TV: Subscriber additions slowed 18 percent from last year to 20,400. VOD usage up to 55 percent of digital viewers, 62 million monthly views. V+ DVR subs added 56,600 to hit 668,500 subs.
— Mobile: Replicating Orange’s French strategy: “We are currently in negotiations to agree our first ever three screen rights deal so that customers can access the same content via TV, PC or mobile.”
— Content: Re-introducing VMtv’s own channels to BSkyB (NYSE: BSY) bumped revenue up 26 percent to £35.7 million despite advertising falling. Contract customers up 60 percent to 784,000 on cross-selling.