Virgin revenues rise as 100 Mbps rollout begins
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ThE MaStEr
2010-10-27
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Virgin revenues rise as 100 Mbps rollout begins
By Julian Clover
October 27, 2010
Virgin Media has confirmed the launch of its 100 Mbps high-speed broadband service. The DOCSIS-powered service goes live today in Enfield, Chelmsford, Farnborough and Heckmondwike, West Yorkshire, meaning that 200,000 homes will be enabled before the end of the year, bringing the cableco in line with its European peers.
Announcing its third quarter results Virgin increased revenues by 6.4% to £978 million, another 14,100 net new cable TV customers were added.
There were 236,000 gross additions and the average revenue per cable customer (ARPU) was up by 3.7% to a record £46.38. Churn increased slightly to 1.6%.
59% of customers now use the on demand service. Average monthly VOD views were 73m, up 10.8%. During the quarter, an additional 222,100 HD customers were added to reach an installed base of 1.42m.
However, the number of broadband net additions is starting to slow, 33,800 on the quarter, compared to 39,000 in the same quarter of 2009. Virgin has subsequently shifted its focus to the current two top tiers with around 608,000 out of a broadband base of 3,969,000 taking the 20 Mbps service and 100,000 on 50 Mbps.
Cable telephony is also under pressure with 14,300 net disconnects on the quarter compared to net additions of 16,000 a year ago.
Although the use of DOCSIS technology has meant Virgin could have increased its speeds earlier, the market position of BT, which has only just begun to promote its own fibre–based broadband Infinity has given a cushion to the cableco.
“The launch of our 100 Mbps service is a significant milestone in the UK’s broadband evolution and a vivid illustration of the power of our next generation network,” said Virgin Media CEO Neil Berkett. “We have already seen a massive uptake in the number of customers watching video rich services and bandwidth hungry high definition programmes and clips.”
In trials, Virgin recorded an exponential growth in internet usage as high broadband speeds encouraged multiple online activities.
In addition to download speeds of 100 Mbps, customers will enjoy download speeds of 10 Mbps. The new 100 Mbps package comes with a new custom-built energy-efficient combined modem and wireless ‘N’ router4, with the potential to deliver speeds of up to 400 Mbps. The 100 Mbps service will be priced at £35 per month when bought as part of a bundle or £45 as a standalone product.
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