TalkTalk has signed up over half a million homes to YouView in less than a year, staking a claim for its TalkTalk TV broadband bundle as the “fastest growing” television service in the United Kingdom. BT has yet to make the same impression with its YouView offering and its sports strategy has so far had mixed results.
TalkTalk reached the half million mark at the end of August, having reported reaching 390,000 at the end of June, since its launch at the end of the previous September.
“Reaching this milestone in less than a year is a great achievement,” wrote chief executive Dido Harding in the TalkTalk blog.
TalkTalk is offering a free YouView box, worth around £299, to its broadband and telephone customers, subject to an 18 or 24 month contract.
However, the TalkTalk chief executive revealed that only a quarter of TalkTalk TV customers have paid for any programming. That includes the potential to sign up to Sky Sports channels on a monthly basis. The most watched programme on the on-demand platform is apparently the pre-school show Peppa Pig.
How is this all working for TalkTalk? At the end of June 2013, TalkTalk had 4,071,000 million broadband customers, compared to 4,043,000 when it launched its television service and 4,129,000 a year previously. So at best it has maintained its broadband market share, while giving it something to talk talk about. Meanwhile its share price has generally continued to rise, while revenues have remained much the same.
With four million broadband customers to talk to, the ability for TalkTalk to grow its television offering is mainly limited by the cost of subsidizing the boxes. It will soon bring out a cheaper box without a hard drive to reduce this cost.
So how far can TalkTalk take this? Around one in eight customers have so far signed up to get a free YouView box. Could TalkTalk take its base to a million or more, or even start to challenge Virgin Media, which has 3.8 million television customers?
The TalkTalk giveaway strategy appears to be more fruitful than that of incumbent telco BT, which seems to be having a harder time giving away an equivalent box.
Last we heard, at the end of June, BT had 833,000 television homes, including those with YouView or those with an old BT Vision box, of which it had 749,000 when it launched with YouView.
BT has bet a billion pounds on its exclusive sports strategy and it is too early to tell whether it will deliver results. The company says that over a million customers have signed up to its BT Sports package, the majority of them getting it bundled free with their broadband, many of them watching through Sky or Virgin Media, which compete with BT as broadband providers. A billion pounds would buy around 5 million YouView boxes.
The opening match of the season attracted a peak audience of just 764,000 individuals to BT Sport. However, a maximum of 36,000 people watched a recent Glasgow Rangers match, a figure less than the margin of error for BARB ratings, and substantially fewer than the 44,800 that watched at the Ibrox Stadium.