Sky TV growth spikes with Paramount, PlayStation deals set to kick in
Joseph O'Halloran | 01-05-2014
UK pay-TV giant BSkyB has resuscitated its previously flat-lining TV service in what it has described as a strong quarter of growth despite falls in profit.

In addition, and indicating where it sees the key future areas of growth to be, it has reported record viewing figures for English Premier League football for which it holds premium rights. It has also struck a key content deal with Paramount Pictures and inked a deal with Sony Computer Entertainment UK to make the multiscreen Sky Go and the NOW TV over-the-top (OTT) services available on the PlayStation (PS4) game console.

Regarding financial performance, for the nine-month period ended 31 March 2014, Sky generated revenue of 5.666 billion, up 6.6% year-on-year. However the 1.2234 billion EBITDA and operating profit of 910 million were down by 2.4% and 8.5% respectively compared with the corresponding period a year earlier.

For the third quarter of the year, Sky added 764,000 new paid-for subscription products, meaning 2.4 million in the year to date. Among these were 74,000 net new TV customers, more than double growth in QI 2013. Sky added that connected TV services were ahead of plan and delivering clear benefits and that almost half of its TV customers were now connected and that on-demand usage tripled year-on-year. By the end of the quarter there were a total 3.7 million Sky Go unique users, up 13% year-on-year.

The pay-TV firm also revealed that its flagship SkySports service has already set new records for live Premier League football with two weekends remaining as what it calls the most exciting Premier League season in years reaches its climax. Sky Sports customers have set new records for viewing across TV and mobile and based on data for the season so far, average audiences for live matches on Sky Sports are up 7% on last and dispute huge competition from a buoyant BT, Sky noted that 49 of the season's 50 most-watched Premier League matches were live on Sky Sports.

Commenting on the year to date Jeremy Damrosch, chief executive, said: "We have had a strong third quarter and continued to grow at an accelerated rate as customers respond to the quality and breadth of our offering. Nine months into our plans for the year, we have added almost a third more new paid-for subscription products than in the same period last year. We are making good progress in developing new revenue streams. Our targeted advertising service, AdSmart, is attracting many new advertisers to Sky while our new Buy & Keep service in Sky Store opens up the DVD purchase marketplace for the first time."

The new multi-year licensing agreement with Paramount Pictures will bring Sky Movies customers exclusive access, during the first pay-TV window, to current hit titles such as Noah, Anchorman 2: The Legend Continues and Jack Ryan: Shadow Recruit, as well as future releases such as Teenage Mutant Ninja Turtles and Transformers: Age of Extinction. Sky Movies will be the first subscription service in the UK and Ireland to show new Paramount Pictures movies. Sky Movies customers will be able to enjoy exclusive access to new titles from Paramount around eight months after they are released in cinemas. Once on Sky Movies, the films will be available exclusively on the service for more than a year.

As part of the Sony deal, Sky users will be able to watch NOW TV on the PS4 from this summer with Sky Go becoming available later in 2014. NOW TV customers will be able to connect their PS4 to their TV and home Wi-Fi to watch the OTT service's content on their main TV as part of their subscriptions. Meanwhile Sky TV customers will be able to watch TV from Sky Go on a PlayStation3 (PS3) or PS4 for the first time.