Sky’s rivals include Netflix and YouView.

BROADCASTER BSkyB has started the fightback against competition Netflix and YouView as it announced a new internet TV service.

Launching in the first half of this year, the service will be aimed at the 13 million households who do not subscribe to pay-TV.

It will initially allow customers to pay to download films without a contract or a satellite dish but will expand to include sport and entertainment afterwards.

Sky’s TV sales will face competition with the launch of YouView, an internet-connected set-top box involving the BBC, ITV and BT.

And the expansion of Netflix, which allows customers to pay to download movies, and the Lovefilm download and rental business adds a further threat.

Sky also revealed underlying profits grew 16% to a record £601m (€724m)in the six months to Dec 31 through sales of telephony and broadband packages.

Revenues rose 6% to £3.4bn (€41bn).