Sky broadband numbers soar

BSkyB’s fledgling broadband service has exceeded expectations to become a major player in the market just a year after its launch. Trading figures released this week show Sky Broadband has 716,000 customers, increasing by 259,000 since the last forecast and surpassing its target of 700,000 mooted 12 months ago.

Sky aims to reach 3 million customers within “three to four years” of launch.

It has also beaten analysts’ expectations by adding 90,000 customers to its pay TV service in the three months to the end of June, up 17% year on year. It now has 8.6 million customers, leading chief executive James Murdoch to say the company is “well on track” to hit its target of 10 million customers by 2010.

Furthermore, the company says its churn rate – the number of customers leaving its service – has fallen from 13.7% in the last quarter to 12.1%.

The Sky Plus service is taken by 28% of Sky households, increasing by 207,000 to 2,374,000, beating forecasts of 25% by 2010. The number of subscribers for its High Definition service increased by 48,000 to 292,000 and Sky Talk customers reached 526,000. Sky’s average revenue per user has grown £21 year on year to £412.

Sky has been locked in a bitter battle with cable rival Virgin Media, itself the subject of takeover fervour. Sky’s basic channels, including Sky One and Sky News, have not been available on cable since the beginning of March, when the two companies failed to strike a deal over carriage fees.

One Virgin Media suitor, the US private equity giant Carlysle is said to be considering dropping the brand if its bid is successful in a bid to restore relations with Sky.

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