Virgin Media loses subscribers

BSkyB battle hits sales

LONDON — Virgin Media — the rebranded U.K. cable group NTL — is bracing itself for losing more subscribers as a result of the bitter row with satcaster BSkyB.

The dispute, which led to BSkyB pulling a number of its channels from the Virgin platform because the two failed to agree a new deal over carriage fees, has so far had a limited impact on the company, according to CEO Steve Burch.

But this is likely to get worse, said Burch, as Virgin reported a loss of 46,900 customers in the three months to March as sales dipped 5% to $2.04 million.

“We’re not really sure what the impact in Q2 will be, but we’re flagging up the possibility that TV additions may not be as strong and could be negative,” he indicated.

Burch added: “We can’t pretend that we’re not going to have some impact for taking those channels off.

“We’re not being cavalier about it, but we’re comfortable that we made the right decision economically for the business, and we believe that in the long term we made the right decision for the customer.”

Burch was speaking as Virgin announced an operating loss of £15.3 million ($30.6 million) for the three months to the end of March, compared with a loss of $1.8 million for the same period in 2006.

The cable combo added 36,100 new TV subscribers, but lost 63,400 phone customers as competitors like the U.K.’s Carphone Warehouse mobile provider and BSkyB marketed ‘free’ broadband packages.

Virgin, which is listed in New York but based in London, has taken BSkyB to court in the U.K.

The cable company, relaunched in February following the merger of NTL and Telewest, claims BSkyB is attempting to strangle it at birth, an allegation the Murdoch-controlled satcaster denies.

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