BSkyB keeps subscriber target in sight

BSkyB today kept alive its hopes of 100,000 new subscribers by the summer as it prepared for a new service that promises razor-sharp pictures on TV screens.

The satellite broadcaster reported “encouraging demand” for High-Definition Television after bookings were opened to the public a fortnight ago ahead of its national launch on May 22.

The technology will offer customers four times more detail than normal TV and is broadcast with surround sound. Channels include Sky Movies and National Geographic, while the BBC’s live coverage of the football World Cup will also be available in high definition.

Initial demand for the new technology softened fears that BSkyB may fall short of its subscriber targets after 40,000 more customers signed up for its services between January and March than looked elsewhere.

BSkyB stuck by its previous guidance that a further 60,000 would join by the end of June when its financial year ends, lifting its total subscriber base from a current mark of 8.1 million.

The company added 215,000 customers in the second quarter but has already put investors on standby for slower growth as it focuses efforts on the take-up of new services.

Today’s results for the nine months to March 31 showed that BSkyB made record operating profits of £660m (€961m) – up 15% on a year earlier – and pre-tax profits of £425m (€619m) that were 10% above the level of the corresponding period.

But it was still struggling to get to grips with churn – the drift away of subscribers to rivals such as NTL, which recently threw down the gauntlet to BSkyB by buying Virgin Mobile and pledging to offer a fourplay service of pay TV, internet access, mobile phone calls and fixed-line telephony.

Churn during the quarter increased by 0.8% to 11.4% and meant BSkyB moved further away from its medium-term target of around 10%.

But keeping hold of customers may be easier after it was revealed that BSkyB has won at least three of the six packages of live Premier League football currently being auctioned, while the company remained on track to offer broadband this summer following its acquisition of Easynet for £211m (€307m) in October.