Sky+HD Boosts BSkyB’s Profits; 3D Channel To Launch 1 Oct

Jonathan Sutton

British Sky Broadcasting (BSkyB), the leading satellite subscription TV broadcasting company in the United Kingdom, announced today that it has more than tripled its annual profits on the strength of healthy subscription numbers especially for its high-definition (HD) packages.

BSkyB reported a jump in net profits to £878 million for the financial year ending 30 June 2010, up from £259 million the company posted in 2008/09. This is no doubt helped by a strong fourth-quarter operating profit before exceptional operating costs of £237 million (beating market analysts’ expectations of £233 million) which represents a 24% increase from the £191 million recorded over the same period last year.

Fourth-quarter revenue rose 12% from £1.36 billion last year to £1.53 billion this year, while average revenue per head also increased 9.5% from £464 at the same time last year to stand at £508 on 30 June this year.

Key to such solid financial results is the popularity of BSkyB’s Sky+HD service. BSkyB’s chief executive Jeremy Darroch said the company had doubled its Sky HD subscribers over the past year, with 429,000 (most of whom were existing Sky subscribers) added during the fourth-quarter (between April and June), boosted by a spike in demand among users to watch the FIFA World Cup 2010 in South Africa in glorious high-definition.

In terms of new customers, BSkyB said that it recruited 90,000 in the 4th quarter, bringing its total number of subscribers to 9.86 million as the company inched closer to the 10 million landmark.

BSkyB also secured a 5-year deal with US Pay TV network HBO, which will allow BSkyB to exclusively deliver hit shows such as The Wire, The Sopranos, True Blood and the forthcoming crime drama from Martin Scorsese Broadwalk Empire to its subscribers in HD. The broadcaster will also officially launch its 3D TV channel on the 1st of October with an expected mixture of sports (live Ryder Cup golf 3D broadcast, 3D Premier League football, 3D darts, etc.) and 3D movies (including Monsters Vs Aliens, Bolt and Alice In Wonderland).

These moves are part of BSkyB’s strategy to attract new subscribers with exclusive content not available elsewhere in the UK, following Ofcom’s ruling which forced BSkyB to lower the wholesale price at which it sells certain premium sports channels (Sky Sports 1 and Sky Sports 2) to its rivals including Virgin Media and BT.

BSkyB recently rejected a 700-pence-per-share bid from Rupert Murdoch’s News Corporation – which already owns 39.1% of BSkyB – for full control of the company, demanding a higher offer in excess of 800 pence a share.