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BT doubles its share of pay-TV market

Research from Kantar Worldpanel ComTech on the home services market – covering broadband, fixed landline and pay-TV – reveals strong gains for the major players amid further turmoil for TalkTalk.  BT, Sky and Virgin Media have all seen year-on-year customer growth, with BT’s share up by 7.8 percentage points on last year thanks to strong TV and broadband propositions.

Fiona Keenan, strategic insight director at Kantar Worldpanel, comments: “BT has almost doubled its share of the paid television market from 15 per cent this time last year and has been performing well since it began showing more premium sports content, namely UEFA Champions League and Premier League football.  While making strong gains in television it has also successfully retained customers and performed well in its core markets of home broadband and landline – helping it to close the gap on Sky, which is coming under greater pressure for quarterly sales.  In fact, BT has ramped up the pressure on competitors across each of the home services markets, driven by a combination of well thought-out propositions and strong marketing campaigns.

“In times of uncertainty consumers tend to favour brands they trust.  BT benefited more than anyone else from TalkTalk’s data hacking scandal last year, with 40 per cent of those leaving TalkTalk moving to BT in the months following on from the data breach.  With such a solid reputation in the market, BT has been able to tap into its sizeable broadband base and cross-sell its television propositions, using the lure of premium football content to entice customers new to the brand.”

Despite its reputational advantage, price is still a key concern for consumers, and almost two-fifths of the new customers to BT television in the last quarter chose the provider primarily for the cost of the package.  Fiona Keenan comments: “There’s a sizeable portion of consumers who want premium content like sport without paying premium prices.  BT has cottoned on and is running promotions which complement a strong value and content message.  Its latest – free BT Sport for anyone with a contract mobile phone subscription with EE – shows how it can leverage its post-acquisition strength across the various home services and mobile markets to bring consumers more value.”

Sky also saw its overall share increase this quarter with strong gains in broadband and landline, though its share in paid television is down by four percentage points year-on-year, dampening overall growth.   Fiona Keenan explains: “The launch of Sky Q has helped it increase its distance from BT in paid television acquisitions quarter on quarter.  However, this hasn’t been enough to return its performance to last year’s standards.  With a strong content portfolio and high brand engagement Sky is well placed to sell its new service into its vast existing base.  As with prior premium launches it will take time to gain critical mass, but Sky is ready to go head-to-head against a bullish BT as it looks to enter the mobile market itself.”

Virgin Media continues to see gains on last year thanks to the continued expansion of its cable service.  Fiona Keenan explains: “Virgin Media benefits from a satisfied consumer base, second only to Plusnet.  The big loser though is TalkTalk.  Despite gaining share of new customer acquisitions in the first quarter of this year – largely the result of strong and heavy promotional activity – share has nearly halved this period when compared to this time last year.

“TalkTalk is a shadow of its former self compared with how well it was performing before the data hacking scandal came into play.  In a market that is becoming increasingly noisy TalkTalk seems to have lost its voice and consumers seem unwilling to listen.  The momentum it generated following the data scandal recovery has gone and nearly a fifth of its customers still want to leave as soon as they can – TalkTalk has its work cut out if it’s to see its previous success again.”

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