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Virgin Media Hails 2010 As Best Year Yet

David Gilbert by

Virgin Media Hails 2010 As Best Year Yet

The average amount of money a customer is paying Virgin Media rose to a new high of £47.51 per quarter in 2010, driving revenue growth by 5.8 percent.

As it prepares for its annual earnings call in London this lunchtime, Virgin announced that its overall revenue rose to £3.8 billion in 2010 with Q4 being the first quarter the company had ever topped the £1 billion mark for a three month period. Overall in 2010, Virgin Media, which comprises TV, broadband, phone and mobile phone services, added 76,600 new customers. This was a massive rise compared to the previous year when only 17,600 were added. Indeed, in the final three months of 2010 alone, it added 17,100 new customers.

The area where Virgin Media saw the largest growth was in its broadband service. A year-on-year growth rate of 40 percent for its high-speed services was announced and in the fourth quarter of 2010 alone, it signed up over 44,000 new broadband subscribers from within its overall customer base, taking its total to almost 4.3 million. Of this figure, Virgin said that 780,000 customers took one of its higher speed broadband services. These include the 30MB (recently upgraded from 20MB) and 50MB as well as the super fast 100MB service which is only available in some parts of the country.

Looking at its TV service, the rate of new subscribers in Q4 fell to just 12,100 taking its total number of subscribers to 3.78 million. It also added 60,000 new subscribers to its Sky premium suite of channels and Virgin CEO, Neil Berkett, took the opportunity to have a pop at Sky, who lost out to Virgin and other providers last April in an Ofcom decision which meant it had to cut the price it charges rivals: “It is amazing what a little help from Ofcom can do."

However while this may have been a small victory for Vigrin, Sky’s customer base rose to over 10 million in 2010 and it reported profits of £520 million last month. It also reported strong growth in its broadband service with 24 percent of customers bundling it with their TV subscription. However with TiVo boxes now rolling out to customers, Virgin Media will be hoping that this combined with reduced Sky price will drive growth even further in 2011. "Our new TV service, powered by TiVo, will provide a real step change in home entertainment as customers benefit from the unique power of the Virgin Media network," Berkett added.

Source: Virgin Media

Go to comments

TechnicPuppet

February 17, 2011, 7:22 pm

Sky will never reach 11m customers imo. They are now as big as they are ever going to be. A few reasons why.





*Satellite is a poor viewing platform, this becomes more apparent as technology moves on


*The power of sports to draw customers is loosening(over saturation, courts)


*Amazon will challenge for movie rights, they didn't buy lovefilm to post out discs


*Virgin/Tivo, Youview, BT Vision, Freeview, Freesat etc etc will take customers


*As they loose customers they will lose the ability to subsidise their internet service

KultiVator

February 17, 2011, 11:51 pm

@TechnicPuppet - spot on - particularly noteworthy is the point regarding Amazon / LoveFilm - who are sure to be offering vastly improved streaming services in the next few months.





Sky's biggest problem is that they depend primarily on BT copper cable for their broadband service - which imposes bandwidth and quality limitations that Virgin don't have to worry about.





Virgin's slight weakness is perhaps that they are now just a TV carrier - they no longer possess a single channel of their own (having recently sold them all to Sky of all people - bizzarre move for a measly £160m given the long-standing rivalry!). But to the average Joe, does that really matter - as long as they get the TV shows they want.





But for many folks looking to move up a gear - Virgin's TIVO and Fibre-optic broadband is going to be a potent draw in 2011. It's certainly on my to-do list and I might even consider retiring my long-serving dual-Freeview-tuner media Centre if TIVO really is as good as it sounds.

TechnicPuppet

February 18, 2011, 1:13 pm

I think Virgin selling their channels can be seen as slightly stupid or really smart. The dream situation for UK consumers is content and platforms being separated, the way it is in the US. Sky are now the only company abusing the power of their content to increase customers to their platform. Sky Atlantic is the latest in a long line of examples of this. It shouldn't be allowed and now that it is clear only one company are doing this, regulators might act.





However, I think the market will rectify the situation first. Sky platform subscribers will start to fall, competition for content will heat up and the only way Sky will survive is to get their channels on as many platforms as possible for a fair price. I see Sky's future in content and seriously doubt that in 10 years time anyone will be getting satellite dishes installed.

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