TalkTalk today showed Britons are embracing internet-connected TV in their droves as the telecoms provider is signing up 12,000 customers a week, a rate that looks more than a match for rival BT.
Chief executive Dido Harding said growth was accelerating as TalkTalk persuaded 150,000 TV customers to take a YouView set-top box during the first three months of the year.
In contrast, BT, which has just announced free Premier League TV football for broadband subscribers, added 40,000 TV customers in the period.
TalkTalk only entered TV last autumn and now has 230,000 such customers, compared with BT’s 810,000 after seven years.
Harding gave shareholders further cheer as TalkTalk enjoyed its first quarterly revenue growth for three years and she hiked the dividend 15 per cent.
The shares surged more than 8 per cent as the City reckons last week’s plunge in the wake of the BT “free football” announcement was overdone.
Harding said many of her customers came from Britain’s eight million homes that take Freeview and Freesat, both free TV services, and they weren’t that interested in pay-TV sport.
“We’ve very comfortable that value-seeking customers want a little bit of TV, not a lot of TV,” she said. “On average our customer is paying £26. BT’s is paying £40 and Sky’s is £50. That makes a really big difference in tough economic times.” Pre-tax profits fell 4 per cent to £120 million, partly because Harding’s TV foray, which includes giving away free YouView boxes, has cost £62 million.
Connected TV has finally gone mainstream as viewers watch, record and catch up on shows via an internet-enabled set-top box.
Sky said 569,000 customers upgraded to a connected box in the past three months. Virgin Media added 172,000 to its similar TiVo box.
BT said, in response to TalkTalk’s numbers, that it was also seeing “good uptake” from its YouView boxes and won “more than double the TV customers Sky and Virgin Media did” in the last quarter.