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Slow Quarter as Virgin Media Grows to 4.8 Million Cable Broadband Users

Friday, Aug 5th, 2016 (7:39 am) - Score 639

Virgin Media (Liberty Global) has today published their latest Q2 2016 (calendar) results, which found that the UK cable operator had added +42,700 new broadband subscribers in the quarter to total 4,808,000 (down from +70.4K added in Q1) and their on-going network expansion has reached another 85,000 premises.

The increased coverage in urban areas stems from VM’s on-going Project Lighting network expansion, which aims to reach 17 million UK premises by 2019 (60-65% UK coverage). Some 500,000 of the extra 4 million premises planned by 2019 will be added during 2016 (note: 1 million+ of those will be delivered using FTTP instead of HFC DOCSIS technology), which is up from the 250,000 added in 2015. So far some 70,000 of these were completed during Q1 2016 and Q2 has, as above, improved its pace to add another 85,000.

Overall Virgin Media’s Two-Way Homes Passed figure (i.e. homes on those sections of Virgin’s hybrid coaxial cable and fibre optic network that are technologically capable of providing two-way services, including video and Internet) has reached 13,057,000 (up from 12,960,800 in the previous quarter).

At this point some might well wonder why VM hasn’t increased their subscriber base at a faster rate. The reason for this is likely to be two fold. Firstly, as we’ve seen on Openreach (BT’s) platform, general network expansion grows uptake at a slower pace. Secondly, Virgin attracts a lot of student subscribers via their 9 month contract offers and this means they suffer a hit during Q2 when those same students cancel and return home for the summer.

Slow uptake can also be caused by several other factors, such as consumers being unaware of the new service, people being locked into long contracts with their existing ISPs, higher prices for the new service and or satisfaction with an existing service (no desire to change) etc.

Virgin Media Results Statement (Broadband UK + Ireland)

Demand for faster broadband speeds remains strong with an additional 597,000 subscriptions over the last twelve months to our “Vivid” broadband tiers, which offer speeds of 100 Mbps and higher, including 114,000 in Q2. Our Vivid broadband service is now taken by 49% of our total 5.2 million broadband internet subscribers.

In addition, we have enhanced the speed and reliability of our customers’ in-home WiFi with the launch of the Hub 3.0 router in November 2015, which had an installed base of 550,000 units at the end of Q2. In July, we launched our summer marketing campaign ahead of the Olympics featuring Usain Bolt to reinforce our superior speed message.

It’s worth pointing out that Virgin Media also had a total of 3,021,400 mobile customers on their EE based MVNO platform in the UK (up from 2,997,400 last quarter) and 3,712,600 take their TV / video services.

On the financial front Virgin Media delivered total quarterly UK revenue of £1,119.0m (up from £1,084.3m at the same time last year) and their monthly Average Revenue Per Customer Relationship (ARPU) was £50.14, which is up from the previous quarter’s £49.82.

Once again the big disappointment here is the lack of any update on Virgin Media’s upgrade plans for their forthcoming Gigabit broadband capable DOCSIS 3.1 technology. We are also waiting to see if their earlier trials of faster upload speeds can be turned into a tangible roll-out (here), although it’s not a massive change.

Mark-Jackson
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 X (Twitter), Mastodon, Facebook and .
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