Sky invests £192m in broadband expansion



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Sky invests £192m in broadband expansion

BSkyB has unveiled full-year underlying operating profits of £958m, up 6% on the year, on revenues of £4.55bn, up 10%. Sky's investment in residential broadband and telephony removed £169m from those operating profits, with further operating losses of £23m coming from Easynet, Sky's internet service provider.

Today's headline financial results, which exceeded analysts' estimates, follow the release of key performance indicators earlier this month which showed that Sky added 90,000 net new direct-to-home subscribers in the three months to the end of June, a 17% increase to 8.58m.

Sky's broadband customer base rose by 259,000 to 716,000 while customers of Sky's telephony service, Sky Talk, reached 526,000. Sky's broadband and telephony network is now powered via 1,150 unbundled telephone exchanges, giving it 70% coverage of UK households, six months ahead of schedule. UK Online, Easynet's residential broadband service, ended the year with 32,000 customers, bringing the Sky group's total broadband customer base to 748,000.

Sky said 71% of its on-net broadband customers were choosing a paid-for product (the 'Base' product offering download speeds of up to 2 Mbps is free to existing subscribers), while 93% of customers were connected within 11 working days.

Hailing the year as one of "enormous importance and change for us", Sky CEO James Murdoch said the launch of broadband and telephony services was "transforming our business and our future prospects fundamentally".

"This expanded product range is now attracting new customers to Sky at a very healthy pace, as well as deepening our relationships with existing customers. The team has delivered a strong financial performance whilst building the foundations for future growth."

Meanwhile, Sky has announced it is forming a joint venture with Sony Computer Entertainment Europe to offer PlayStation Portable owners in the UK and Ireland video-on-demand content from Sky. Programmes will be downloaded to PSPs via wi-fi, or transferred from PCs. Access to content will be either on a subscription or pay-per-view basis.

Regards Satdude.