Virgin reveals cost of Sky Deal

Announcing its quarter numbers Virgin Media revealed the cost of settling the carriage dispute with Sky. Virgin will pay Sky approximately £38m (E48) a year over the course of the contract to June 2011. However, Sky will pay Virgin an increased amount of £24m a year to keep its channels (Living, Trouble and Bravo) in the Sky DTH pay bundle. The cable carriage fee is made of a £30m guarantee plus capped performance related payments.

Meanwhile, Virgin says that one of its two Sit-up shopping channels will no longer be carried on the Freeview DTT platform from next January having been outbid in the re-advertisement of the capacity.

The cablenet added only 8,300 new customers in the quarter, but among its existing base added 68,700 new broadband customers, and the number of subs taking its top tier broadband product has grown 78% year-on-year. 19% of customers now take the 4Mbps broadband product and 10% receive 20 Mbps. In total 3.88 million subscribers take a broadband service.

Triple play penetration reached a record 54.7%, up 7.7% on 12 months ago. 43,800 subscribers were added for the V+ PVR bringing the installed base to 468,700 or 14% of available digital subscribers: 3,407,900 of its total 3,576,500 TV subscribers.

Total revenue in the quarter ending September 30, 2008 was £991.1 million, just ahead of Q2, but down from the £1,006.2 million of September 2007. The company attributes the fall to reduced mobile and business revenues. ARPU was stable at £41.94.

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