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ISP TalkTalk Falls to 4.1M On-net Broadband Users and Offers Incentives

Wednesday, November 11th, 2015 (8:37 am) - Score 1,133

After the recent cyber-attack TalkTalk, which dubiously skipped their previous Q2 2015 report (here), has today published a financial update for Q3 2015 (calendar) and revealed that they’ve lost -80K broadband subscribers in the past 6 months to make for a total of 4.1 million (on-net).

It’s fair to say that TalkTalk has recently had quite a rocky ride. A big part of that occurred over the past few weeks, following the cyber-attack (here). On top of that the sale of their off-net base to Fleur Telecom (Daisy Group) has worked to counter some benefits from the recent Virgin Media + Tesco additions (here) and lest we not also forget this year’s steep price hikes (here).

Unfortunately the recent troubles have all conspired to whitewash over some of their more positive developments, such as the first customers going live on the new 940Mbps capable FTTP fibre optic broadband network in York (here). In any case we’re not surprised that today’s results reflect a more sombre mood.

TalkTalk’s FTTP Progress Update for York

We have made good progress with Ultrafast, our fibre to the premise trial in York with 262 triallists signed up from the 3,328 homes in the first phase of the build and registrations from the wider build area covering 6,000 homes, running at 50 per week.

Sadly TalkTalk has adopted a much more vague reporting style, which doesn’t offer a clear breakdown of broadband subscribers and as such we are having to do our own calculation based upon the last results from 6 months ago (here), when the ISP reported a total broadband on-net and off-net base of 4,283,000 with +15K being added in Q1 (calendar).

Since then the ISP claims to have lost 80,000 on-net broadband subscribers (apparently 72,000 of those were “non-paying customers” as a result of changing the late payment policy from 180 to 90 days). As for their off-net base (recorded as 106,000 in Q1 2015), many of those have now either migrated away or been moved to Fleur (note: 90,000 remain via their business division).

However TalkTalk says that “for the purposes of external reporting, we will no longer report the off-net base“, which means that we too will now only reflect the on-net figures. In that sense our total subtracts both the -80,000 on-net decline and all -106,000 off-net from the Q1 report.

Otherwise today’s total includes 578,000 taking their “Superfast Fibre Broadband” (FTTC) service, which is up by +99K in the last 6 months (technically much worse than the +83K added in Q1 alone). Demand has apparently been helped by the introduction of the self-install option, with over 90% of H1 connections being self-install.

Dido Harding, CEO of TalkTalk, said:

We have delivered H1 results in line with our plan and revenue growth accelerated strongly through the second quarter. We have a robust plan to deliver a significant step-up in profits in H2, underpinned by the benefits of our transformation programme coming through strongly.

We have recently been able to confirm that far fewer people were impacted by the attack than originally feared. However, TalkTalk takes the security of customers’ data extremely seriously and we are taking significant further steps to ensure our systems are protected, as well as writing to all our customers outlining what we are doing to keep their data safe. In recognition of the unavoidable uncertainty, and because we know that doing what is right for our customers will ensure the best possible outcome for the company over the longer term, we are today announcing the offer of a choice of free upgraded services to all our customers.

TalkTalk is well established as the value for money provider in the fast growing quad play market and, notwithstanding the recent attack, remains well positioned to deliver strong and sustainable long term growth.”

The ISP clearly understands that its customers aren’t very happy right now and so they’ve also announced a raft of free upgrades (incentives) for their existing users. From 1st until 31st December, all customers will be able to add a selection of the following to their package “at no extra cost and with no additional commitment” (talktalk.co.uk/customerupgrade):

* TV content including movies, kids entertainment and sports.
* A mobile SIM with a monthly allowance of free texts, data and calls.
* Unlimited UK landline and mobile calls.
* A broadband health check by experienced engineers.

Elsewhere TalkTalk reported that they had added +132,000 new mobile customers in the last 6 months to make for a total of around 596,000. On top of that they also added 25,000 new TV customers during the half, taking the total base of triple-play customers to 1.4 million. Overall 16% of their customers now take mobile, with 39% taking TV and 16% on FTTC.

On the financial front the ISP reported total 6 month revenue of £912m (up from £871m in the same period last year), while annual profit after tax fell to just £11m (down from £27m in the same 6 month period last year). In fact profits are actually considerable worse at -£7m after tax if you include “exceptional charges and amortisation of acquisition intangibles“. Elsewhere they saw on-net churn of 1.5% (up from 1.4%) and ARPU of £28.08 (up from £26.45).

In addition, TalkTalk has now reintroduced their online ordering system and reduced the prices of their packages. All deals include a free wireless router, free calls between other TalkTalk users, free HomeSafe Internet security / Parental Controls, totally unlimited usage, an 18 month contract term and the included Talk2Go App. A quick summary of the new offers can be found below.

SimplyBroadband (up to 17Mbps)
Free for 18 months, £7.50 per month thereafter

Fibre Broadband (up to 38Mbps)
£5 a month for 18 months, £10 thereafter

Plus TV
Get Broadband, premium TV (6 Sky entertainment channels included), anytime calls and a mobile SIM
£10 a month for 18 months, £20 thereafter

Essentials TV
Get Broadband, TV and anytime calls
£7.50 a month for 6 months, £10 thereafter

UPDATE 9:17am

The financial impact of the cyber-attack in FYMar16 is also estimated as being around £30-35m and it’s worth considering that next to the ISPs weak profits.

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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.
Leave a Comment
5 Responses
  1. Annabella says:

    (long post warning)
    So November 2015 my partner gets a letter telling us we are being Migrated from
    TalkTalk To some unknown company called Fleur Telecom, (I’ll add moved against out wishes.)
    We decide to do a little research, most come up with nothing but media outlets saying
    how people are being dropped from virgin to talktalk, then from talktalk to this unknown Fleur and other such news items. So we dig a little deeper and find its website, it claims to be a British based company. hmm.. ok well their still new maybe.
    so we dig deeper again and we find talktalks posts on the matter, most people are unhappy (I know I’m one of those unhappy people), at this sudden dump. so I dig around some more and find some company backgrounds, one claims their 2 years old, another says their 1 year old and then one says their only a few months old. well that struck me as a bit odd but I foolishly left it at that. But that’s the simple bit, it gets Worse from there!

    So November comes to an End my partner goes on to talktalks site thinking the November bill would be still owed to talktalk, but instead he is greeted with an insulting “we’re sorry you left” message in place of his “my account” page, So he phones TalkTalk thinking that’s going to be easyer, after a while of god awful music we get to someone, he asks to speak to billing, gets put though tells them the problem and he’s told “sorry sir you now owe your bill to Fleur, please call them now sir.” So my partner phones Fleur gets though to some nice lady, tells her the problem and she tells him wait for this. “sorry Sir we don’t have you on our records yet, your bill is still owed to TalkTalk at this point” And so begins a 2 month tennis match of who we owe our November bill to.
    Mid December comes its December 22nd the Tennis match is still going! but WAIT someone for Fleur phones our mobile (something we didn’t provide them details of) while we in transit on a very busy bus (its Xmas shopping season) on our way to a medical, the lady on the phone asks my partner to provide billing information and card details even AFTER he told her “sorry I’m on a packed bus on my way to a medical right now” and so he asks her to call back on the landline on the 23rd when he knows we will
    be in ALL day long. 23rd December No phonecall on land line nothing not even a beep on the mobile with its whole unstable 1 bar of signal. Later My partners mother texts my mobile asking if something has happened to the landline or have we got a new number? we text back saying no not that we know of, and so more texts start coming in from friends and family all asking if we’re ok, what’s happened to the phone, so I track up the grit bin at the top of the hill in my backwater Devon village I live in to get the only known spot in the whole village to have mobile phone signal and try to phone the landline. “this number is not in service”. Hmmm So I head back home and tell my partner then sends e-mail to contact Fleur to find out what the heck is going on. Internet is the only thing still active on the line at the time. auto response telling us to Phone Fleur. So he tries to phone Fleur on the landline, types in 2 numbers and gets the “Durr, durr, durt. This number is not recognised” he also tried 111 and 999 as soon as he hit the 2nd number he gets “number not recognised” hmm phone cut off then. (as well as Fleur braking the law on emergency numbers).
    We spend all of xmas right into the first week of jan totally un-contactable. the mobile is pay as you go with no credit and no signal hmm BIG problem. 2nd week of jan a Man phones the mobile from Fleur, its a miracle the phone has found a rare whole semi stable bar of signal we put books under it and put it onto loud speaker in hopes of keeping it stable, my partner talks to the man and explains the problem. the man agrees its a big problem and unblocks the phone to incoming calls only so that Fleur themselves can contact us. We think “at last some headway” we find out the phone Is barred because of outstanding bills from November and Now December. Ok yep we had been trying to pay those for the past 2 months! but we didn’t know to who. Problem was there was now no money in our account because other bills had needed paying and he was going to have to wait 3 days. ok not a problem the man tells us, 3 days later our phone beeps up it has a voice mail. hmm… we then try to find a way to
    get the voice mail, need some kind of pin, we take it to EE shop they tell us its because its an old sim from an old network that no longer exists. BIG problem, someone from Fleur manages to contact us again while we’re out, my partner explains the problem only this time the woman is a bit obnoxious. We get home we e-mail them explaining the problems we are having, that we can’t get into our my account on Fleur’s site and they finally give my partner his log in info. My partner Finally manages to pay some of the bill off (£20), two more weeks roll by my partner pays £40 more of the bill off, we are having to do it bit by bit because its mounted up during the months of the tennis game of who we owe that we can not afford to pay it ALL off in one lump sum. now thinking he’d be ok for a couple more weeks when he could pay off some more, under the impression they could legally only charge for line rental and
    internet charges for January (and he’s right, to charge you for something you are not getting is theft.)
    He said he would pay the remaining £50 next money and that would be the bill finally sorted.
    NOPE Thursday 28th of January he gets a call on the mobile, from the obnoxious lady, My partner was not feeling overly well that day so I was in the background as she then tried to BULLY him to pay £158.99 upfront right now or be cut off. I was “ay, how is it that high?” So I enquire as to why its high and she goes “Oh its January’s bill now added on, you have to pay the whole lot or be cut off” she tells me. hmmm so I told her “excuse me but could you please explain to me why January is so high” she then brakes down the bill. I challenge her on the costing, saying “Excuse me how can we owe you for the phone packages we have been cut off for the whole of January so could use nothing of the phone at all” she then tries to fob me off with utterly weak excuses.
    So I ask if we can speak to a manager she says yes, and I ask could she phone the landline please or e-mail us because we don’t know if the mobile can hold signal and it can not pick up voice mail. 2 hours later the phone get half a bar or something but it pings in another voice mail! I was at this point just wondering if I was starting to loose my little bit of sanity or if the people at Fleur really are THAT stupid!
    we have now spent since Thursday Arguing with the so call management from Fleur over e-mail because I e-mailed them stating I want to make a complaint about our treatment so far from Fleur and I went into Lengthy detail and even the manager still can not comprehend the problem with cutting the line off both ways in a rural area where mobile signal is non existent, Today they have closed all our internet ports making it so we have extremely limited internet access.
    The whole fiasco is radicles. Also this so call manager thinks its legal to charge you for items you are not getting. Charging you for something you are not getting is Theft plain and simple. Fleur Claims to be a British based company yet it FAILS to understand basic laws and BASIC consumer standards.
    Needles to say we have now changed company and are just waiting for all the bits to come from them so we can LEAVE Fleur I might even go as far as to get a legal injection against Fleur so they can not so much as send a promotional mail to me in the post.
    I would encourage anyone who has found themselves suck with Fleur to Leave ASAP before you become their next victim. They try to charge you things you can’t get if your cut off, so they commit Fraud, they bully and harass and FAIL to understand basic facts. So any tiny bit of trouble any at all go direct to Ofcom http://consumers.ofcom.org.uk/complain/ and report it and also go to cisas http://www.cedr.com/cisas/ and see if they can help. It’s sadly obvious at this point that Fleur are only going to learn the hard way.

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