August 14, 2013 10.51 Europe/London By Julian Clover

Changes in encryption and its TV product portfolio, coupled with the cost of investment in broadband and marketing made for an unhappy first quarter and Kabel Deutschland.
The operator, in the process of being acquired by Vodafone, reported an increase in EBITDA of 3.8% at €217 million.
Premium TV added an additional 24,000 RGU net additions in KDG’s financial first quarter. Demand was generally soft following the decision of key private channels to remove the encryption from their standard definition channels.
Subsequent changes in the portfolio in April has meant the standard definition product has become ‘plug and play’ for the latest TV sets, reducing demand for basic pay-TV services.
KDG says that amid a pent up demand for HD and PVR services its general positive outlook on Premium TV remains unchanged.
In total, Premium TV RGUs amounted to 2,094,000 at the end of June, plus 312 thousand year on year.
HD Private more than doubled to 1,380,000 activated smart cards (versus 688 thousand one year earlier). As a result of better subscriber mix and growing Premium TV penetration, the total blended TV ARPU per subscriber increased to €10.66 in the first quarter, up by €0.46 or 4.5% from €10.20 in the previous year.