Sky customers are trading down slightly

Jeremy Darroch, BSkyB’s CEO (and former CFO) told the Financial Times that his pay-TV subscribers were trading down a little. Asked what 2009’s recession looked like in terms of its own business, Darroch said “It's difficult to predict exactly - 2009 is going to be a difficult year for the consumer environment.”

Darroch confirmed that “so far” pay-TV income had proved to be “pretty resilient” to the downturn and that through 2008 Sky had grown at a slightly faster rate than 2007. But he was cautious on what might be happening to subscribers and Sky’s top tier bundles.

Asked whether subscribers were “trading down”, Darroch admitted this was happening “a bit… Right across our business what we are seeing are more marginal pressures and we are certainly seeing more customers come in at a basic level and a bit more pressure in terms of downgrades. Conversely, though, we're also seeing customers taking more services from us. One of the things we are seeing is that TV remains central to people's lives. They are consuming more TV than ever before.”

He told the FT – and perhaps referring obliqely to the current dilemma at Tiscali - that Sky had no need to buy another Internet company. “We've worked hard over the past few years to assemble the distribution assets we think are going to be competitive for the long term, and that is why we acquired our own broadband network three years ago. If there are opportunities we will be open-minded, but there is not really anything we feel we need to do,” he said.