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HDTV Suffers In Silence Beneath Sky’s Headline Growth

by David Mercer | 4月 30, 2008

Sky’s quarterly results announcement today focused on steady growth in the total customer base. Given the tough economic background and talk of falling consumer spending it is no mean achievement for the company to add 289,000 new customers in the three months to March, although churn left a position of 56,000 net new adds. The company remains on track to meet its 10m target by the end of 2009. Given the constant promotion Sky is giving to HDTV, however, its performance here is very disappointing. 43,000 customers added HD service in the quarter, bringing the total to 465,000, or 5% of the total base. Of those 43,000, 24% (10,000) were customers new to Sky. This means that less than half of one per cent of Sky’s customer base at the beginning of the quarter were persuaded to upgrade to the HDTV service, in spite of the constant bombardment of Sky HD advertising and cross-promotion. Sky touts the addition of more channels during the coming months, but even with 18 to choose from the selection looks poor compared to the hundreds available on standard Sky multi-channel and premium packages. To be fair, it is the best performing HD service in Europe (which doesn’t say much for the rest), and it has also taken HD providers in the US nearly 10 years to make HDTV a success. Sky’s numbers illustrate how tough it is for service providers to persuade their existing customers to add new services. Even Sky+, which is the fastest growing service in terms of new customers, was added by only 1.7% of existing customers, and only 1.5% added broadband. Multiroom fared even worse than HD in Q3, although it had already built a much larger base of users. Sky’s position on HD is that it took several years before Sky+ adoption began to grow rapidly, and it expects a similar pattern to emerge with HDTV. But this will be little encouragement to HD broadcasters and indeed set-top box vendors. Until Sky changes its marketing approach (making at least some of its own and partners’ HD channels available at no extra charge, and reducing set-top box costs) it seems that HDTV is set for a long slow journey towards mass adoption. Client Reading: HDTV Channels Shut Down: A Sign Of Things To Come? Add to Technorati Favorites
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