Virgin Media plans push for video-on-demand services
Programme guide redesign and new HD content to boost service already tried by half cable company Virgin Media's users
Virgin Media is planning a major push to persuade the half of its customers who have yet to experiment with video on demand.
The recent introduction of ITV content to Virgin Media's interactive cable TV service boosted views to 55 million per month in the first quarter of the year.
The company is also looking to capitalise on its bitter pay-TV rival BSkyB's recent success with high definition services by launching more HD channels in the summer, and increasing the number of HD programmes available on VoD.
Virgin Media, which announced that it added a better-than-expectated 7,100 new customers in the three months to end March, taking its customer base to 4.76 million, already has 53% of its customers using VoD services.
Last year the cable company tied content from the BBC's iPlayer into the broadband service and in February it added ITV programming, with shows such as Coronation Street, Emmerdale and The Jeremy Kyle Show attracting millions of views.
"Video on demand is becoming the application to use," said chief executive Neil Berkett in an interview with MediaGuardian.co.uk. "The number of avid users is just growing and growing and we are now concentrating on getting even greater reach."
Virgin Media is planning to change its electronic programming guide so that catch-up TV content is as easy to find as linear television channels. The company has also been testing tying adverts around VoD content, offering another potential money-spinner.
"We are seeing catch-up programming driving things forward," Berkett added. "But HD on demand is also becoming important and we are launching, in July or August, another half a dozen linear HD channels as well. We think it is time to start to join the evolution of HD viewing, economically it is about the right time."
Earlier this year, Sky slashed the cost of its HD service and launched a major advertising push to persuade viewers to start watching HD content. The move helped the satellite broadcaster add 80,000 new customers in the first quarter.
Sky persuaded 243,000 of its customers to take up HD television in the first three months and now has more than 1 million HD households.
Now Virgin Media is looking to get in on the act. Berkett said its new HD channels with "be principally from external parties" rather than developed by its in-house content business.
There has been intense speculation that Virgin Media has placed its content business – which includes its half share in the UKTV joint venture with the BBC, along with channels such as Living TV and Virgin1 – up for sale. But Berkett refused to be drawn on the future of the business today.
Virgin Media is able to increase the amount of HD and VoD content available on its cable network, which covers roughly half the UK's households, because of a technical upgrade, which allowed the company to last year launch broadband at 50Mb per second.
Berkett refused to say how many customers have signed up to the super-fast service but the company has already started trials of an even faster broadband offering. Commercial trials of broadband at 200Mb per second began in Ashford, Kent, last week.
Alongside the introduction of much faster speeds than are currently possible on BT's copper network - which is used by rivals including Sky and TalkTalk to provide internet access - the upgrade of Virgin Media's cable network is allowing the company to upgrade its basic broadband service from 2Mb per second to 10Mb. The upgrade of its 2.4 million basic broadband customers starts this month and as a result Virgin Media recently announced it will be increasing the price of its basic service by £2 a month.
Three-quarters of the 47,300 broadband customers that Virgin Media added in the first three months of the year took a service at 10Mb per second or higher. Including a quarter of a million customers who are outside its cable network, Virgin Media currently has just under 4 million broadband users.
The price increase - which Berkett does not believe will lead to an exodus of customers - has given him the confidence to predict that "consumer revenues will grow in the second half of the year". Revenues were essentially flat in the first quarter at £604m.
Richard Wray
Tuesday 5 May 2009 13.23 BST
guardian.co.uk © Guardian News and Media Limited 2009
Programme guide redesign and new HD content to boost service already tried by half cable company Virgin Media's users
Virgin Media is planning a major push to persuade the half of its customers who have yet to experiment with video on demand.
The recent introduction of ITV content to Virgin Media's interactive cable TV service boosted views to 55 million per month in the first quarter of the year.
The company is also looking to capitalise on its bitter pay-TV rival BSkyB's recent success with high definition services by launching more HD channels in the summer, and increasing the number of HD programmes available on VoD.
Virgin Media, which announced that it added a better-than-expectated 7,100 new customers in the three months to end March, taking its customer base to 4.76 million, already has 53% of its customers using VoD services.
Last year the cable company tied content from the BBC's iPlayer into the broadband service and in February it added ITV programming, with shows such as Coronation Street, Emmerdale and The Jeremy Kyle Show attracting millions of views.
"Video on demand is becoming the application to use," said chief executive Neil Berkett in an interview with MediaGuardian.co.uk. "The number of avid users is just growing and growing and we are now concentrating on getting even greater reach."
Virgin Media is planning to change its electronic programming guide so that catch-up TV content is as easy to find as linear television channels. The company has also been testing tying adverts around VoD content, offering another potential money-spinner.
"We are seeing catch-up programming driving things forward," Berkett added. "But HD on demand is also becoming important and we are launching, in July or August, another half a dozen linear HD channels as well. We think it is time to start to join the evolution of HD viewing, economically it is about the right time."
Earlier this year, Sky slashed the cost of its HD service and launched a major advertising push to persuade viewers to start watching HD content. The move helped the satellite broadcaster add 80,000 new customers in the first quarter.
Sky persuaded 243,000 of its customers to take up HD television in the first three months and now has more than 1 million HD households.
Now Virgin Media is looking to get in on the act. Berkett said its new HD channels with "be principally from external parties" rather than developed by its in-house content business.
There has been intense speculation that Virgin Media has placed its content business – which includes its half share in the UKTV joint venture with the BBC, along with channels such as Living TV and Virgin1 – up for sale. But Berkett refused to be drawn on the future of the business today.
Virgin Media is able to increase the amount of HD and VoD content available on its cable network, which covers roughly half the UK's households, because of a technical upgrade, which allowed the company to last year launch broadband at 50Mb per second.
Berkett refused to say how many customers have signed up to the super-fast service but the company has already started trials of an even faster broadband offering. Commercial trials of broadband at 200Mb per second began in Ashford, Kent, last week.
Alongside the introduction of much faster speeds than are currently possible on BT's copper network - which is used by rivals including Sky and TalkTalk to provide internet access - the upgrade of Virgin Media's cable network is allowing the company to upgrade its basic broadband service from 2Mb per second to 10Mb. The upgrade of its 2.4 million basic broadband customers starts this month and as a result Virgin Media recently announced it will be increasing the price of its basic service by £2 a month.
Three-quarters of the 47,300 broadband customers that Virgin Media added in the first three months of the year took a service at 10Mb per second or higher. Including a quarter of a million customers who are outside its cable network, Virgin Media currently has just under 4 million broadband users.
The price increase - which Berkett does not believe will lead to an exodus of customers - has given him the confidence to predict that "consumer revenues will grow in the second half of the year". Revenues were essentially flat in the first quarter at £604m.
Richard Wray
Tuesday 5 May 2009 13.23 BST
guardian.co.uk © Guardian News and Media Limited 2009
