Internet and phone provider TalkTalk ( AOL UK , Tiscali , Opal ) has released its latest Q3 financial (FY 2010/11) results, which saw its broadband ISP customer base decline by -25,000 from a total of 4,249,000 in the previous quarter to 4,224,000 now. It had previously managed to add +18,000 new customers during Q2.

The move is significant and reflects some of TalkTalk's many problems, most of which hit during the last half of 2010. The ISP is under pressure from Ofcom over bad billing practices (here) and an investigation into whether or not it mis-sold its fixed line phone services (here). Not to mention the Tiscali email migration woes and concern over their tracking of customer website visits.

By contrast TalkTalk itself claims that the decline mainly reflects "continuing churn in the former Tiscali base", as the network and systems migration processes continued to create disruption for some customers. Indeed most of the lost customers have come from their Tiscali side, with TalkTalk itself still being in positive territory.


Presently 85% of TalkTalk's broadband customers are using the groups cheaper unbundled ( LLU ) platform (up from 81% in Q2), which covers over 80% of the UK population. TalkTalk is currently rolling-out its network to an additional 700 exchanges, which will make the service available to 93% of the population. Some 55 of the 700 exchanges are already under way.

The good news is that TalkTalk claims to still be "on track" with its quad play ambitions, despite concern that its TalkTalk TV service might be delayed due to internal squabbles and technical problems within the YouView camp. It has also pledged to improve its mobile offering and market the service "more actively [with] our fixed line customer base".

On top of that TalkTalk is about to launch its new FTTC based "Fibre Bradband Boost" add-on for existing customers, which will give them download speeds of up to 40Mbps. In addition to this they've just announced a new deal with BSkyB ( Sky Broadband ) to trial their own 100Mbps fibre optic FTTH broadband service.


The latter news bodes well for the future, although most customers tell us that they would prefer it if TalkTalk refocused upon improving customer service and quality. This would at least patch up the Tiscali bleed and give them room to focus on developing new services without risking further harm to their reputation.

Today's results also push TalkTalk down one place in our Top 10 ISPs By Subscriber Size table, which makes Virgin Media the second largest broadband provider once again.