UK ISP TalkTalk Returns to Growth with 4.053m Broadband Subscribers

Budget UK internet and phone provider TalkTalk can celebrate today after the ISP returned to growth, following a three year period of decline, by adding +10,000 new broadband subscribers during Q4-2012 (total 4,053,000). The number of customers taking their superfast “fibre” broadband (FTTC) package also increased to 52,000 during Q4 (+22k).

At the same time TalkTalk’s new YouView (IPTV) based “Plus TV” service bundle saw its subscribers climb from 29,000 in Q3-2012 to 80,000 homes in Q4-2012. The ISP has thus increased its installation capacity to 10,000 per week and begun the expected trial of a TV self-install service (i.e. no need for the cost of an engineer visit).

TalkTalk eyes its TV package as a vital customer retention tool and this appears to be supported by new ICM Research, which found that 7 out of 10 of their customers were more likely to stay with the ISP because of the new product. Clearly it’s working but they still have a long climb before being able to match BTVision in the TV sector (Sky and Virgin are still a VERY long way away).

Dido Harding, CEO of TalkTalk, said:

“We have returned our total customer base to growth for the first time in three years – an important milestone on our journey to become a growing and more profitable business. We successfully launched TV and mobile handsets this summer and the growth in take-up by both existing and new customers underlines the scale of opportunity we see in these additional products.

With good trading momentum across the business, we have entered the final quarter strongly focused on execution. We are confident of delivering full-year results in line with our guidance, and are making real progress towards our medium term targets of 2% revenue growth and 25% EBITDA margin.”

Elsewhere TalkTalk has managed to unbundle (LLU) a further 22 telephone exchanges in the quarter from BT, which means that their cheaper broadband and phone services are now available from a total of 2,717 exchanges around the United Kingdom (covering around 94% of the population). Elsewhere the total revenue for TalkTalk stood at £415m in Q4 (down from £422m in Q3).