Broadband and SIM Only up, mobile contracts down for Virgin

Virgin Media has had a weaker than expected outcome for the first quarter of 2017, in part due to falling mobile contracts.

Virgin now has 5.8 million cable customers with 30 million subscribers to its contract and SIM Only services.

While revenue is on the up, at £1.13bn, mobile subscriptions fell by 11 per cent.

The company blamed the loss on the fact that more people are moving away from longer contracts to its SIM Only deals.

By contrast, UK cable and TV subscriptions grew by their fastest rate in the last 10 years. In total Virgin gained 65,000 new subscribers, up 36 percent on the previous year.

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Other positives from the results included the introduction of a new ultrafast 300Mbps home and business broadband service plus a new service expanding WiFi by sharing the connection from home broadband routers.

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At the moment this WiFi sharing service is only enabled on Virgin Media Hub 3.0 routers but Virgin are expected to make it backwards compatible with the previous generation of Hub 2AC routers too.

Virgin faced heavy criticism after admitting it wildly overstated how many UK homes could get its Project Lightning superfast broadband.

Four staff were suspended and the former director of mobile at TalkTalk, Jeff Dodds, was brought in, which seems to have steadied Virgin’s ship somewhat.

The Q1 results highlight the fact that Virgin’s £3 billion network expansion, which aims to cover a total of 17 million UK premises by 2019, has continued to progress, although slower than anticipated.

If successful it would boost Virgin’s coverage to 60-65 percent of the UK.

Virgin reported they now have some 3 million mobile customers on their EE-based Virgin Mobile platform and 3.7 million with their TV and video services. It has been estimated that more than a third of new customers were due to Project Lightning.

The release of Virgin Media’s first quarterly results for 2017 set tongues wagging that that Vodafone and Virgin Media might again be involved in a possible merger or asset swap, but this remains simple speculation at this time.