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Virgin Media UK Holds at 4.38 Million Broadband ISP Subscribers for Q2 2012

Tuesday, July 24th, 2012 (1:23 pm) - Score 652

National UK cable operator Virgin Media has today released its latest quarterly results (Q2-2012), which saw their broadband ISP subscriber base increase by just +4,000 in the quarter to total 4,385,600 (significantly down on the +30,500 added in Q1-2012 and +17,500 in Q4-2011). But what of a future 200Mbps product?

In fairness this has long since become normal for the operator, which claims to “traditionally” see “negative [Q2] customer growth for seasonal reasons” at this time every year. One of the reasons is because of university and college students leaving their temporary accommodation to return home, which is usually countered by an uptick later in the year as they return.

The vast majority of VM’s internet access subscribers continue to come from its superfast cable (DOCSIS / EuroDOCSIS) platform (4,152,600), while their slower Virgin National (Virgin.net ADSL2+) based non-cable services stood unchanged over Q1-2012 at 233,000.

Today’s results also reveal that 1.3 million of Virgin’s cable customers are now on a superfast broadband (30Mbps or faster) package, which is a strong boost from the 850,000 recorded in Q1-2012 (+459,800) and is largely because of the operators £110m project to double its broadband speeds (here). So far 765,000 customers have had their speeds upgraded (22% of VM’s network) and this work is due to complete by the middle of 2013.

Otherwise 590,000 customers are currently on Virgin Media’s 50Mb to 100Mb packages and 41% of new subscribers took speeds of 60Mbps+ during the quarter (note: 30Mbps is now the operators entry-level package speed).

Neil Berkett, CEO of Virgin Media, explained:

This has been a quarter of improved revenue and OCF growth. We are well placed to benefit from the fast-growing demand for superfast broadband and TiVo positions us well to lead the evolving TV market. Customer ARPU and churn have improved and, together with our growing Business division and great value mobile offerings, we have maintained steady financial progress across the company which is translating into strong free cash flow as well as continued shareholder returns.”

Overall Virgin Media’s total quarterly revenue stood at £1,027m (up 4.2% from £1.006bn in Q1) and their cable network’s Average Revenue Per User (ARPU) improved to £48.82 a month from £46.95 in Q1 (up 3.1%).

But the big question is whether or not Virgin Media will respond to BT’s new 330Mbps capable Fibre-to-the-Premises (FTTP) service by launching its much anticipated 200Mbps product before the end of 2012 as originally hinted. The 200Mbps service has been in trial for close to 2 years but the operator has always said that it would need to see demand before bringing it to market.

At the present time BT’s 330Mbps FTTP service isn’t much of a threat due to its limited coverage, although it does give the incumbent an advantage in bragging rights (marketing). But this could change in Spring 2013 when FTTP-On-Demand becomes available to all FTTC lines. However FTTP-On-Demand is widely anticipated to be too expensive for most home users.

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By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.
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