Cowabunga! TalkTalk signs Bart for TV battle

The telecoms outfit is promising value for money as it takes on the three big beasts of pay-television

Dido Harding is used to upsetting the odds. She is a former jockey and racehorse owner, and her steeplechaser Cool Dawn won the Cheltenham Gold Cup at 25-1 in 1998. Cool Dawn wasn't the greatest horse, but it was a value bet and won on the day.

Ms Harding, now chief executive of telecoms group TalkTalk, might not describe her new foray into pay-TV in such terms, but she would certainly agree it's about offering a value option. She has just announced plans to give premium customers a free YouView internet-connected TV set-top box, worth £300, if they sign up for a "triple play" of broadband, home phone and TV.

This is a bold move by Ms Harding to turn TalkTalk, previously best-known for just broadband and home phone, into a serious low-cost alternative to the big three beasts in pay -TV and telecoms – Sky, Virgin Media and BT. Talk Talk's "triple play" package will cost £29 a month, and she claims it is "the best value for money by some margin".

Her target is the millions of Britons who want a wide range of TV channels but don't want to pay a big monthly subscription of £50 or more for a package from the top-of-the-range players. "It is a very natural upgrade for seven and a half million Freeview customers," says Ms Harding.

Anyone can buy a YouView box, which has just launched. It offers all the Freeview channels from the BBC, ITV and others, plus catch-up programming from the last seven days, a search-and-browse facility and the ability to pay for programmes.

But the £300 price tag in stores is a deterrent, which is why Ms Harding hopes to outsmart rivals by offering the boxes free to TalkTalk's one million premium customers. In another significant move, Ms Harding has agreed a deal with BSkyB to offer her customers most of Sky's main channels, including Sky Sports 1, 2, 3 and 4, Sky Movies and Sky1, home of The Simpsons. (Only Sky Atlantic is not part of the deal.)

A TalkTalk customer can also pay for the channels on a month-by-month basis, rather than having to sign up to an annual deal, and manage their account online. "If you're a cricket fan, you'll only have to pay for Sky Sports during just the cricket season," she says.

BT and Virgin have spent years haggling over the wholesale prices they must pay Sky. Even now, BT doesn't carry Sky Sports 3 and 4. Yet Ms Harding has suddenly swooped and secured her own deal. Clearly Sky doesn't see low-cost TalkTalk as a threat to its premium offering. BT and Virgin are likely to be worried.

In another coup, TalkTalk, which was spun out of Carphone Warehouse two years ago, has recruited Sony chairman Sir Howard Stringer, a global media heavyweight, as a non-executive director.

Giles Cottle, principal analyst at Informa, said TalkTalk was smart to strike deals with Sky and LoveFilm, rather than entering "an unwinnable battle" by offering its own content. "It is a classic 'telco TV lite' strategy, designed to protect its broadband customer base," said Mr Cottle. "TalkTalk has executed it very well."

TalkTalk shares, which have gained 25 per cent in the past year, yesterday jumped 3.4p to 176.4p.

One worry is TalkTalk's past reputation for poor service. But Ms Harding insisted it has overcome those problems as customer numbers finally stopped falling and grew last month. She is also not rushing the introduction of YouView because, in her words, she wants to "de-risk the launch". Customers must book an engineer visit for £50, with installations not starting until September.

Giving away set-top boxes is not cheap but Ms Harding says every TV customer should be profitable within the lifetime of an initial 18-24 month contract. In the ultra-competitive world of telecoms, "triple play" is the Holy Grail – not only because the provider makes more money from each customer but also because phone, TV and broadband are converging.

Keen horsewoman that she is, Ms Harding can certainly say TalkTalk is now at the races.

Sky high: Profits set £3m-a-day record

BSkyB showed just what Rupert Murdoch is missing as Britain's biggest pay-TV company raked in record annual profits of £1.89bn — equivalent to more than £3m a day.

Mr Murdoch, who aborted his takeover of Sky because of the phone-hacking scandal, insisted a month ago that his News Corporation is no longer interested in buying the FTSE 100 firm, but another strong set of numbers from Sky suggests otherwise.

Pre-tax profits surged 17 per cent to £1.19bn in the year to June.

In a further sign of strength, chief executive Jeremy Darroch hiked the company's dividend 9 per cent to 25.4p and announced a new, £500m share buyback.

The vast majority of Sky's 10.6 million subscribers already take TV, so Mr Darroch has focused on selling more broadband and home-phone services.

Sky recruited only 20,000 new TV subscribers in the last three months, but 138,000 signed up for broadband and 141,000 for home phone.

"A switch-and-save message for customers has worked well in a very tough, economic environment," said Mr Darroch, who froze prices last year.

Even so, annual revenues rose 4.5 per cent to £6.79bn.

Churn, the rate at which customers quit, also improved. That suggests the pay-TV giant is not yet feeling much impact from online rivals NetFlix and LoveFilm, even though Sky has launched its own cut-price internet service, Now TV.

He said Sky deputy chairman Tom Mockridge, who runs Mr Murdoch's troubled newspaper arm News International, was not in a difficult position now that News Corp is splitting its TV and publishing interests.

"We're a separate independent company," said Mr Darroch.

PROMOTED VIDEO
Arts and Entertainment
From Mean Girls to Mamet: Lindsay Lohan
theatre
Sport
Nathaniel Clyne (No 2) drives home his side's second goal past Arsenal’s David Ospina at the Emirates
footballArsenal 1 Southampton 2: Arsène Wenger pays the price for picking reserve side in Capital One Cup
News
Mike Tyson has led an appalling and sad life, but are we not a country that gives second chances?
peopleFormer boxer 'watched over' crash victim until ambulance arrived
Arts and Entertainment
Geena Davis, founder and chair of the Geena Davis Institute on Gender in Media
tv
News
i100
Travel
travelGallery And yes, it is indoors
News
ebooksAn unforgettable anthology of contemporary reportage
Life and Style
tech
Arts and Entertainment
The Tiger Who Came To Tea
booksJudith Kerr on what inspired her latest animal intruder - 'The Crocodile Under the Bed'
News
i100
Arts and Entertainment
British actor Idris Elba is also a DJ and rapper who played Ibiza last summer
film
News
Alan Bennett criticised the lack of fairness in British society encapsulated by the private school system
peopleBut he does like Stewart Lee
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

IT Project manager - Web E-commerce

£65000 Per Annum Benefits + bonus: Clearwater People Solutions Ltd: If you are...

Trainee / Experienced Recruitment Consultants

£20000 - £25000 per annum + OTE £40,000: SThree: SThree are a global FTSE 250 ...

Trainee Recruitment Consultant - Soho

£20000 - £25000 per annum + OTE £40000: SThree: As a Recruitment Consultant, y...

Trainee Recruitment Consultants - Banking & Finance

£20000 - £25000 per annum + OTE £40,000: SThree: SThree Group have been well e...

Day In a Page

Syria air strikes: ‘Peace President’ Obama had to take stronger action against Isis after beheadings

Robert Fisk on Syria air strikes

‘Peace President’ Obama had to take stronger action against Isis after beheadings
Will Lindsay Lohan's West End debut be a turnaround moment for her career?

Lindsay Lohan's West End debut

Will this be a turnaround moment for her career?
'The Crocodile Under the Bed': Judith Kerr's follow-up to 'The Tiger Who Came to Tea'

The follow-up to 'The Tiger Who Came to Tea'

Judith Kerr on what inspired her latest animal intruder - 'The Crocodile Under the Bed' - which has taken 46 years to get into print
BBC Television Centre: A nostalgic wander through the sets, studios and ghosts of programmes past

BBC Television Centre

A nostalgic wander through the sets, studios and ghosts of programmes past
Lonesome George: Custody battle in Galapagos over tortoise remains

My George!

Custody battle in Galapagos over tortoise remains
10 best rucksacks for backpackers

Pack up your troubles: 10 best rucksacks for backpackers

Off on an intrepid trip? Experts from student trip specialists Real Gap and Quest Overseas recommend luggage for travellers on the move
Secret politics of the weekly shop

The politics of the weekly shop

New app reveals political leanings of food companies
Beam me up, Scottie!

Beam me up, Scottie!

Celebrity Trekkies from Alex Salmond to Barack Obama
Beware Wet Paint: The ICA's latest ambitious exhibition

Beware Wet Paint

The ICA's latest ambitious exhibition
Pink Floyd have produced some of rock's greatest ever album covers

Pink Floyd have produced some of rock's greatest ever album covers

Can 'The Endless River' carry on the tradition?
Sanctuary for the suicidal

Sanctuary for the suicidal

One mother's story of how London charity Maytree helped her son with his depression
A roller-coaster tale from the 'voice of a generation'

Not That Kind of Girl:

A roller-coaster tale from 'voice of a generation' Lena Dunham
London is not bedlam or a cradle of vice. In fact it, as much as anywhere, deserves independence

London is not bedlam or a cradle of vice

In fact it, as much as anywhere, deserves independence
Vivienne Westwood 'didn’t want' relationship with Malcolm McLaren

Vivienne Westwood 'didn’t want' relationship with McLaren

Designer 'felt pressured' into going out with Sex Pistols manager
Jourdan Dunn: Model mother

Model mother

Jordan Dunn became one of the best-paid models in the world