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
Indeed, so confident is chief executive Mark Booth, that he has set a
goal of one million new subscribers by the first anniversary in
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
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
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
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.