TalkTalk beefs up Sky deal

Under the new deal, TalkTalk customers will get greater access to Skys coverage of boxing. Picture: AFP/Getty Images

The deal will allow customers to watch live boxing and  wrestling events through Sky Sports Box Office, as well as  extending a continuing wholesale deal giving access to the main Sky Sports and Sky Movies channels.

It builds on an agreement earlier this year allowing TalkTalk customers to buy a “day pass” for Sky’s sports channels through its internet TV service, Now TV, on the YouView platform.

The Box Office service can already be accessed by customers of Virgin Media in the UK and UPC in Ireland.

Sky is battling BT over sport after the telecoms giant encroached on its dominance of English Premier League football with a three-year deal to show 38 games a season, before snatching Champions League rights for three years from 2015 for  £897 million.

The satellite broadcaster has responded with the launch of a new channel, Sky Sports 5, showcasing Champions League football until then, as well as Spanish and Dutch league games. This will also be available through TalkTalk under the latest deal.

Mai Fyfield, group director of strategy and business development for Sky, said: “As we continue to increase our investment in high-quality TV, we want to continue to broaden the distribution of our content and grow our content-related revenues.”

The announcement came as TalkTalk reported trading figures showing it had added 185,000 net new TV customers in the first quarter to 30 June, giving a total base of 1.1 million, helping revenue rise 3.1 per cent year-on-year to £434m. The company said it also added 10,000 net broadband customers and that it was on track to meet its targets for the full year.

Chief executive Dido Harding said: “Our strategy for growth continues to deliver according to plan, and we are delighted to report another quarter of base growth and year-on-year revenue progress.”

Analysts at brokerage Espírito Santo Investment Bank noted: “TalkTalk’s first-quarter revenue of £434m was below our forecast £441m and at the bottom end of the consensus range.

“Management has, however, stated that it is on track to reach its guidance for 2015 and the  medium term. Revenue growth was 3.1 per cent in the quarter versus our forecast for growth of 4.8 per cent, which is slightly below the 2015 and medium-term guidance for growth of at least 4 per cent.”

They added: “Operating trends are solid; total broadband net additions of 10k [10,000] compared to our forecast 7k, TV net additions of 185k were ahead of our forecast 167k, 34k fibre net additions were in line with our forecast, and 24k mobile net additions were below our forecast 42k.”

TalkTalk said it now had total secured funding capacity of £819m, “a level we consider more than sufficient to support our medium-term growth and capital structure plans”.