BSkyB has reported strong figures for the last six months, despite the economic downturn, seeing growth in high-definition, broadband and telephone services. It is cutting the cost of Sky+ HD boxes and creating 1,000 jobs in customer service and installation to deal with the anticipated demand. Half of its satellite subscribers now have a digital video recorder, with 8% having high definition. Over 7 million British homes have HD Ready screens, but this is expected to double by the end of the decade.
“In a very challenging economic environment, we have delivered a great set of results,” said chief executive Jeremy Darroch.
BSkyB reported an operating profit of £388 million for the last six months on a 6% rise in revenues to £2.6 billion.
Sky said it will be investing through the economic downturn to take advantage of growth opportunities. While no consumer business is immune to a downturn, Sky said it is positioned well and sees significant opportunity ahead, both by attracting new customers and selling more services to existing ones, including high definition, broadband and telephone services.
There were 779,000 Sky HD homes at the end of 2008, up 188,000 on the previous quarter. An overall increase of 171,000 subscribers takes the total number of Sky satellite homes to just under 9.25 million, within sight of its target of 10 million.
Sky also has nearly 2 million broadband subscribers, up 163,000 in the last quarter, and 1.5 million telephone customers.
The cost of a Sky HD box is being reduced to £49 from £150. Sky expects the incremental cost of £100 to add a new Sky+ HD customer or upgrade an existing subscriber will be fully recovered within 12 months from the additional £10 a month charge.
The growth in the installed base of more advanced boxes will provide a platform for further innovation in the future.
Sky now offers over 30 channels in high definition. The company says that more and more people are starting to regard HD quality video as standard.
The number of Sky subscribers has continued to grow, despite the launch last May of Freesat, a subscription free offering from the BBC and ITV.
Freesat has clocked up over 200,000 sales in just over half a year. That includes standard definition set-top boxes available for around £50, high-definition digital video recorders and flat-screen televisions with integrated receivers.
Over 60% of customers surveyed cited high definition as their primary reason for purchasing a Freesat receiver. Currently, however, they can only receive a single BBC channel in high definition, with occasional sports programmes on ITV.