Euro Telcos Ramp Up IPTV Subs
Telco TV services are continuing to prove popular across Western Europe, according to the latest financial reports from the region's leading incumbent carriers.
But the appetite for IPTV at some of the world's pace-setters looks to be slowing, and for one European incumbent a 20 percent sequential increase in video-over-broadband subscribers couldn't stop its share price falling 12 percent today.
French adore le telco TV
Orange (NYSE: FTE), one of the world's leading telco TV service providers, announced today it had 1.54 million IPTV subscribers in Europe at the end of June, of which 1,389,000 were in France. (See French Dominate IPTV Top Ten.)
The figures look good -– the total European number, which includes IPTV customers in Spain and Poland (but still not yet in the U.K.), is up 76 percent year-on-year, while the French total is up by nearly 66 percent compared with the end of June 2007. (See Orange Vision Lacks IPTV.)
However, there are signs that growth is slowing in France, as the incumbent added only 107,000 new IPTV customers during the second quarter, while it added 133,000 during the first three months of the year. It seems likely that trend will continue in the current third quarter, which includes the French vacation season, when a large portion of the population vacates its homes.
But the growth is still in six figures, and France Telecom did also note a growing demand for video-on-demand services among its French IPTV subscriber base: The carrier reports there were 2,182,000 paid downloads during the first half of 2008, more than double the 907,000 paid downloads during the first half of 2007.
The French giant reported second quarter revenues of €13.3 billion ($20.7 billion), up 4.1 percent from a year earlier. It has nearly 174 million customers globally, of which nearly 114 million are mobile customers, and 12.2 million are DSL broadband customers. (See France Telecom Reports H1.)
The company's results, including net income of nearly €2.7 billion ($4.2 billion) for the first half of the year, were roughly in line with expectations, but with the carrier having stepped away from a costly major acquisition and announced its first ever interim dividend, of €0.60 per share, today, the carrier's share price rose by nearly 3.6 percent to €20.48 on the Paris exchange. (See FT Drops $42B Bid .)
Telefónica slows too
Spanish giant Telefónica SA (NYSE: TEF) is also seeing a slower rate of growth in its domestic IPTV business, according to today's earnings report. (See Telefónica Reports H1.)
The carrier had 576,558 customers in Spain for its Imagenio IPTV service at the end of June (up 28 percent from a year ago), having added 22,513 new customers during the second quarter. However, the operator added 32,307 new IPTV subs during the same quarter a year earlier, and increased its IPTV customer base by 42,958 during the first quarter of this year, so Telefónica's IPTV growth is slower on a year-by-year and sequential basis. (See Telefónica: Big IPTV Numbers. Big Profits .)
However, the operator, which (like FT) is one of the largest IPTV operators in the world, did add more IPTV subscribers in the first half of 2008, about 65,500, compared with the second half of 2007, when it signed up about 60,200 customers to the TV-over-DSL service.
In total, Telefónica has 245 million customers around the world for all it services, including 47 million in Spain, 43 million elsewhere in Europe, and 148 million in Latin America.
Of that total, 182.7 million use the operator's mobile services, while it has 11.5 million fixed broadband customers, of which more than 5 million are in Spain.
During the second quarter, Telefónica reported revenues of €14.25 billion ($22.2 billion), in line with expectations, and net income of €2.06 billion ($3.2 billion), better than expected. The carrier's share price ended the day up €0.07, about 0.4 percent, at €16.73.
BT adds visionaries, stock tanks
While Light Reading doesn't classify BT Group plc (NYSE: BT; London: BTA)'s Vision service as proper IPTV -- the live TV streams are delivered through a rooftop aerial, and only on-demand content is delivered across the customer's broadband connection -- it's worth keeping an eye on its progress, as the U.K. is such a competitive TV services market.
BT says it had about 300,000 BT Vision customers at the end of June, up 20 percent from the 250,000 it had three months earlier, and is hopeful of landing more as the new soccer season starts and as it rolls out what it says is an improved home gateway product. (See BT Vision Touts Soccer Offer.)
One of its main rivals in the U.K.'s TV and video-on-demand services sector, Sky , also updated investors today -– it has nearly 9 million TV subscribers. (See BSkyB Reports Full Year.)
Overall, though, BT got dumped on by the financial markets, as while its revenues grew 3 percent year-on-year to £5.2 billion ($10.3 billion), the profitability of its Global Services division disappointed and the operator's growing net debt, now at £10.5 billion ($20.8 billion), gave analysts cause for concern. (See BT Reports Q1.)
At the end of the day's trading on the London Stock Exchange , BT's share price had fallen 23.7 pence, 12 percent, to 173.9 pence.
And during his first earnings presentation as BT's CEO, Ian Livingston, noted there were no updates on the operator's broadband rollout plans, which involve some fiber-to-the-home (FTTH) announced a few weeks ago, though discussions with regulator Ofcom are under way. (See BT Unveils $3B FTTx Plan and BT's FTTH Conceit.)
— Ray Le Maistre, International News Editor, Light Reading