Those following the ups and downs of the broadband market could be forgiven for thinking that the market is shrinking in the face of the credit crunch. While it is true that some people are giving up telephone lines and DSL for mobile broadband, a lot of the movement in the market is people looking for better value deals.
Bundles of broadband, telephone, TV or mobile phone have been the big success story of the last couple of years, and Sky is evidence of this. The satellite TV broadcaster has published its financial results for the quarter ending 2008 and these reveal that they have some 1.8m broadband customers, and 20% of homes that have Sky TV also have Sky Broadband.
The value of bundles to firms is reflected in that the average revenue per user (ARPU) has risen to a new high with Sky of £430 per year. Of course products like Sky HD which added 93,000 customers in the quarter (total 591,000) with their £10 a month Sky HD Mix fee help to improve the ARPU.
Sky Broadband has been built on the base formed by Easynet and their retail brand UK Online, Easynet still provides broadband in the business sector and generated £47m of revenue.
No one can fully predict the effects of a tightening of home budgets during hard times, but homes with Sky Broadband are likely to stay with Sky even if they reduce the cost of their satellite subscription. So Sky seems to be in a strong position, and has not stalled unlike one or two other providers.