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Virgin Media UK End Difficult Quarter with 5 Million Broadband Users

Monday, May 8th, 2017 (7:29 am) - Score 2,828

Cable operator Virgin Media (Liberty Global) has released their Q1 2017 (calendar) results and reported that the broadband base grew by +80.7K in the quarter (up from +48.8K in Q4) to total 4,997,400 subscribers, while their Hybrid Fibre Coax (DOCSIS) network covered another 102,000 UK premises.

In case nobody noticed, Liberty Global decided to put their results out on a Sunday (usually a good day for burying bad news), which might be partly so that they could limit the impact from a weaker than expected first quarter in the United Kingdom.

The first few months of 2017 have certainly delivered an interesting mix of pros and cons for Virgin Media. On the positive side they introduced a new 300Mbps service for homes and 350Mbps for SME businesses (here and here), plus there’s the new WiFi Sharing service (here) and they’ve started to offer broadband packages with a 30 day rolling contract term (here). All good.

On the other hand the operator has faced criticism for overstating the roll-out progress of their ultrafast broadband and TV network in the UK (here), which triggered a shake-up of their top-level Executive Committee (here). Elsewhere several bugs / security flaws with the Intel Puma 6 chipset inside their SuperHub 3 (ARRIS TG2492S/CE) routers have been biting (here and here).

Nevertheless the operator’s £3bn Project Lightning network expansion, which aims to cover a total of 17 million UK premises by 2019 (i.e. 4 million extra premises [2 million via FTTP] – boosting their coverage of the United Kingdom to around 60-65%), has continued to progress.. albeit much more slowly due to the recent correction.

Overall VM managed to expand their network to another 102,000 premises in Q1 and 355,000 over the last twelve months (way down on the previous claims). The eagle eyed will recall that Virgin had originally projected to reach “up to” 800,000 extra premises during 2017 (good thing they used “up to“) and they now admit that the impact is “likely to result in a slower build pace than what we previously expected.”

Mike Fries, CEO of Liberty Global, said:

“With respect to Project Lightning, we previously reported a reboot of the program along with leadership changes. This transformation includes the appointment of a new Lightning management team reporting to Liberty’s central T&I group and a detailed review of the program with a view towards ramping our construction activity over the next 12 to 24 months.

Although we delivered 102,000 new premises at Virgin Media in Q1 and a total of around 700,000 homes to date, we expect that the management transition and related review is likely to result in a slower build pace than what we previously expected for 2017. We will provide an update after our second quarter. Our new build plans throughout the rest of continental Europe are progressing well.”

Elsewhere Virgin Media reported that they now have a total of 3,015,700 (-6,600 during Q1) mobile customers on their EE based Virgin Mobile platform in the UK and 3,775,300 (+46,200 during Q1) take their TV / video services. On the financial front Virgin Media also delivered total quarterly UK revenue of £1,130.1m (up from £1,102.5m at the same time last year).

It’s possible that their 2019 Project Lightning completion goal, which was last year moved forwarded from the original date of 2020, may now need to be pushed back. However the quote above suggests that they may instead put more resources towards the roll-out and keep it to schedule. We should know the official impact and strategy in time for their next results.

However an interesting aside is that over a third of their customer net additions in Q1 came from those new Project Lightning areas, which is positive. Elsewhere Q1 also saw renewed speculation that Vodafone and Virgin Media might again be discussing a possible merger or asset swap (here), although so far there’s been no concrete confirmation of this.

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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