Despite a 16.6% revenue increase to $334.18 million and solid subscriber growth, News Corp. pay TV operator Sky Deutschland remained in the red in the third quarter of the year.
The German feevee platform narrowed its net loss in the September quarter by 23.5% to €89.3 million ($122.44 million) but still faces a tough local market.
With viewers already saddled with TV license fees of $24 a month for the pubcaster channels plus cable or satellite costs, Sky Deutschland has had a difficult time persuading consumers to shell out yet more money for pay TV, especially when there are 35 free-to-air channels available.
Yet Sky Deutschland is making headway: Aside from the revs hike, rising subscriber numbers and growing average revenue per user resulted in a 19.1% increase in subscription coin, Sky’s main source of revenue.
It also improved customer retention, lowering its churn rate by 4.4 points to 18.9% — its lowest in five years.
“These results provide encouraging signs that we are taking the right steps to build momentum in the business,” said Sky Deutschland topper Brian Sullivan. The chief exec added that the pay TV platform has continued to focus on content and innovation, launching Germany and Austria’s first 3D channel and solidifying its market-leading position in HD with more content.
Sky Deutschland’s Sky Sport iPad app has been downloaded more than 60,000 times since its recent launch. It will next offer the first sport app for the iPad in HD.
During the past quarter, Sky Deutschland secured exclusive live rights in HD and across all platforms for the Wimbledon tennis tournament and the U.S. Masters golf tournament in Augusta, Ga.
Sky Deutschland has also been forging alliances with regional cablers in the face of growing competition from telco giant Deutsche Telekom, which is making its own foray into pay TV.