BSkyB reports subscriber boost

BSkyB said today it remained on course for 10 million customers by 2010 after it gained 77,000 subscribers over the three months to June 30.

With a better-than-expected customer base of 8.18 million, the satellite broadcaster lifted revenues by 8% to £4.15bn (€6bn) in the financial year to June 30.

The group reported pre-tax profits of £798m (€1.2bn), up from £787m (€1.1bn) last year – a rise of just 1%, but in line with City forecasts – boosted by promotional activity and the launch of high definition television.

Some 38,000 customers had subscribed to Sky's HD service which it launched in May, with 90,000 bookings to date. Sky said it expected to install all these orders by September.

The technology will offer customers four times more detail than normal TV and is broadcast with surround sound.

Sky said “churn” – the proportion of customers leaving for rival services - was 10.6% in the quarter taking churn for the year to 11% – in line with expectations.

The group is fighting rivals such as NTL, which recently threw down the gauntlet by buying Virgin Mobile and pledging to offer a “fourplay” service of pay TV, internet access, mobile phone calls and fixed-line telephony.

Sky hit back last week by announcing its own broadband offer and customers are also likely to stay after the group secured key rights to show live Premier League Football.

Chief executive James Murdoch said 2006 had been an important and exciting year.

He added: “We have a clear vision for the future growth and direction of our business and we feel encouraged by the strong demand our customers show for new entertainment and communications services.

“With a continued focus on providing more choice, flexibility and control, we feel confident as we look ahead to the substantial opportunity this market holds for us.”

Mr Murdoch said he was pleased with the initial interest in its broadband service, launched on Wednesday following the group's acquisition of internet service provider Easynet.

“It’s very early days but there’s no doubt we have struck a chord,” he said. “We are seeing a good response with customers and we are very excited about the opportunity.”

He said he would be able to give a full update when first quarter results are released later in the year.

Sky expects to have 3.3 million broadband customers by 2010, he said.