MEDIA: Sky has pulled far ahead of the field in the digital race

What’s the most important media story so far this year? Easy. It’s BSkyB’s confirmation, when unveiling half-yearly results last week, that its digital satellite launch is off to the fastest of starts anywhere in the globe, with 350,000 sales since last October, 120,000 of them to new customers.

What’s the most important media story so far this year? Easy. It’s

BSkyB’s confirmation, when unveiling half-yearly results last week, that

its digital satellite launch is off to the fastest of starts anywhere in

the globe, with 350,000 sales since last October, 120,000 of them to new

customers.



Indeed, so confident is chief executive Mark Booth, that he has set a

goal of one million new subscribers by the first anniversary in

October.



That’s also when SkyDigital will be heavily marketing its next

initiative - mass market internet and home shopping/banking services -

via the British Interactive Broadcasting consortium now renamed Open.

Yet I couldn’t help but overhear several key journalists briefing their

news editors from the results meeting. The deskbound executives were

clearly worried about handing Sky more publicity than it deserved, while

the experts on the beat knew they had an exciting City and consumer

story.



It’s a tribute to Sky that its top management team has almost succeeded

in making this most difficult of launches look easy. The slick briefing,

with waves of City analysts, journalists and investors, made for one of

the most upfront presentations of company results I’ve seen. Except it

that was almost too clever by half: an overnight leak to the Financial

Times of the highly price-sensitive information about the larger than

anticipated digital sales, undoubtedly infuriated the rest of the press

and, together with the ever-present anti-Murdoch factor, tended to

result in the success story being downplayed by rivals.



What happens next seems pretty clear.



The focus of marketing, which has been largely concentrated on

establishing digital as a consumer product, is about to change into

focused selling.



Already by January the percentage of entirely new SkyDigital customers

had risen to 42 per cent from 31 per cent. The current free sports trial

offer being advertised by Sky is entirely pitched at new subscribers.The

new link with AOL - with Sky providing content to its web sites and AOL

marketing SkyDigital to its technology-friendly subscribers - is an

obvious way to target likely converters.



It’s also noticeable that its ’churn rate’ is falling, aided by frozen

prices, cheaper basic packages, investment in homegrown programming

(with a lot more to come on films) and a steady overhaul in schedules.

Of course BSkyB’s referred bid for Manchester United is a key issue. But

it is a television and media company building up a number of support

pillars.



Rival OnDigital, with its curt refusal to provide details of

installations and sales depressed by initial equipment problems, for the

moment can only lie low, until it has something to shout about. It must

hope the tale of the hare and the tortoise is not just a fable.



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