BSkyB have announced that profits for the 12 months to 30th June 2007 were down 9% but revenues were up 10%. This comes as a result of Sky starting up their own broadband service and having to try and win new customers.
These new residential broadband customers resulted in a loss of £169 million and a further £23 million for the purchase of Easynet. They can afford the loss though, as pre-tax profits fell to £724 million from £798 million, showing that Sky can take the hit to gain SKY Broadband customers.
This is likely to be a short term hit to profits for Sky simply because they had to play hard to win customers over from rivals such as Virgin Media and BT Broadband.
Sky has acquired an impressive number of broadband customers by signing up 716,000 broadband customers and beating their target of 700,000 that they had aimed at reaching.
It just goes to show how valuable customers are and what a fierce sector the broadband market still is.
Author: Mark Ward Copyright: BroadbandWatchdog.co.uk - NetMediaUK.com