BSkyB adds 482,000 HD customers in 4Q09

British Sky Broadcasting Group Plc (LSE:BSY) Interim Results for the six months ended 31 December 2009

During the quarter we increased the overall number of customers and sold more products to our existing customers. DTH customer net additions were 172,000 in the quarter, taking the total base to 9.7 million. Within this, gross additions of 402,000 were in line year on year and churn was 9.6%, a 0.3 percentage point decrease year on year.

This quarter saw record growth in Sky+HD following a good response to our Christmas marketing campaign. We added 482,000 net Sky+HD customers, a 156% increase year on year, meaning that we have added 1.3 million HD customers in the last 12 months.

Standardising Set-top Box Platform for New and Upgrading Customers

Building on our success in high definition, we intend to bring our leading box technology and innovation to even more customers. From 28 January 2010 all new and upgrading customers will receive a Sky+HD box and, if they subscribe to our £10 a month HD channel pack for the first time, they will receive their HD box for free (subject to an installation charge).

All HD boxes already have our new on-screen TV guide and later this year we will launch our video on demand and 3D service to HD boxes. Today we are also introducing a premium one terabyte HD box for customers who prefer greater in-home storage. For £249 (plus installation) customers will be able to store the equivalent of around 240 hours of HD content.

Sky 3D

In April 2010, we plan to launch Sky 3D, Europe’s first dedicated 3D TV channel. Initially, the channel will be available to commercial customers, offering a live Premier League match in 3D each week. Later in the year, as availability of 3D TV sets continues to grow, we plan to make Sky 3D available to all Sky+HD customers, with a wide range of 3D content including movies, sport, documentaries, entertainment and the arts. Sky 3D will work with all existing Sky+HD boxes and will initially be introduced at no extra cost for customers who subscribe to Sky’s top TV package and the Sky+HD pack.

As part of the preparations for this ground-breaking launch, Sky will broadcast the world’s first live 3D TV sports event on 31 January 2010. Live coverage of the Premier League match between Arsenal and Manchester United will be filmed in 3D and broadcast over the Sky platform to selected pubs around the UK and Ireland.

Customer Metrics (unaudited)

                                         Quarterly Net Additions
                                         -----------------------  Closing Base
'000s                                     31-Dec-09    31-Dec-08     31-Dec-09
                                         ----------   ----------  ------------
Net Customer Additions                          172          171         9,708
Additional products
  Sky+                                          553          515         6,455
  Sky+HD                                        482          188         2,082
  Multiroom                                     102           68         1,999
  Broadband                                     101          163         2,404
  Telephony                                     130          139         2,112
  Line rental                                   178          173         1,304
Other KPIs
  Gross additions for the quarter (000)         402          398
  Churn for the quarter (annualised %)         9.6%         9.9%
  ARPU(£)                                      £492         £444

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