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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.

Leave a Comment
9 Responses
  1. Avatar DTMark says:

    Bit of a puzzle really – for BT to offer the higher speeds requires work on the D-sides to replace them with fibre.

    For VM to do that doesn’t involve touching their “D-sides” (co-ax). It only requires enough bandwidth at the cabinets. Actually it’s not as simple as that, but that’s the key difference.

    So if they’re in the middle of a resegmentation programme, which implies to me that additional bandwidth is being added at said cabinets (head end and/or street) you wonder why they haven’t taken this into account already so as to be able to go straight to 400meg down 100meg up over DOCSIS3.

    1. Mark Jackson Mark Jackson says:

      I could be wrong but the last time we looked into this Virgin’s problem was that they couldn’t spare enough channels in order to bond all the way up to 400Mbps (200Mbps was the safer bet for now). You still need room for the TV service etc. But recent DOCSIS developments suggests that there may be other ways to push more speed without excessive bonding.

    2. Avatar FibreFred says:

      Not just extra bandwidth at the cabinets, the UBR’s (a constant sore point on their forums) also need work, its the whole network really, everything needs an overhaul to offer those speeds. If their forums are anything to go by they are struggling to offer 100mbps properly in some areas

    3. Avatar Deduction says:

      A few on a forum moaning about the service out of 4.3 Million users hardly says they have issues. If we use that logic FTTC (plenty of complaints about speed on that on BTs forums) is cack and so is every ADSL2+ service.

      Utter stupidity to say everything needs work, especially when several surveys including those by ofcom clearly show in terms of download rates Virgin still comes out top.

      DOCSIS is and always will be more future proof than FTTC, though to be honest in 10-20 years time they will both need ripping out and starting over.

    4. Avatar FibreFred says:

      Who did the surveys for Ofcom? Please don’t say Samknows? As we know you don’t rate Samknows as a credible source or those reports as “Ofcom reports” if a third party did them.

      Its not a few on a forum. If the whole of their network doesn’t need an overhaul why are they spending millions doing just that?

    5. Avatar Deduction says:

      Who is “WE” are you speaking for others no or just the multi IDs still?

      As to spending millions on their network id guess thats the same reason BT according to you are spending millions on their network to upgrade things. Nothing weird about that considering all the big players O2, Sky, Talk Talk are all making significant investments.

      And no i dont rate third party information but you seem to use it and find it credible when it suits, so ill do the same.

      In fact when every survey ive seen says Virgin has the fastest downloads be it ofcom survey or independent i think its safe to say that must be true, or at the very least far more credible than the nonsense you spiel.

      The only products that struggle to offer the headline speeds are products supplied over BTs infrastructure. DOCSIS is the far superior system.

    6. Avatar DTMark says:

      It’s been ages since I really looked at it, but I thought that the way that cable worked wasn’t a million miles from the way that 3G works – a broadcast service over a set of frequencies to a local area, except that the segmented/private nature of the network means that you don’t run out of frequencies and they don’t overlap with neighbouring areas.

      So I’d have thought that the current programme would have involved adding enough channels to bond to achieve future speeds given that one of the biggest costs is the labour to upgrade a segment network like that. Might as well only do it once a decade.

      As far as I know the company still struggles with the way in which acquisitions were made resulting in a disparate network of differing cabinets and tech so again I’d have thought that the plan would be to standardise the network to some degree.

      But then VM has never been what I’d call an especially “commercial company”. Though the new adverts are, for once, quite flash and modern.

  2. Avatar telephone engineer says:

    Those numbers are proof inthemselves that most users are happy at lower (within reason) speeds. You wouldnt believe the work that was generated when sky started to offer free 2meg broadband in a bundle.
    If i was virgin i wouldnt offer anymore speed upgrades for some time, they are offering speeds that will satisfy home users for decades already, they dont need to keep upgrading their whole network for the minority of users.
    Their national product is dissapointing in number, personally i would issue an fttc service with iptv (virgin vision) and leverage the rights they have for linear tv channels.
    There is plenty of live left in the coax, just how you manage it.

    1. Avatar FibreFred says:

      Agreed, no need to replace coax for some time, they just need to be smarter with how its used and ensure there’s enough backhaul and a core to back it up

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