BSkyB announces internet TV service

BROADCASTER BSkyB started the fightback against competition Netflix and YouView today as it announced a new internet TV service.

Launching in the first half of this year, the service will be aimed at the 13 million households who do not subscribe to pay-TV.

It will initially allow customers to pay to download films without a contract or a satellite dish but will expand its offer to include sport and entertainment soon afterwards.

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Sky’s TV sales will face growing competition with the launch in the summer of YouView, an internet-connected set-top box involving the BBC, ITV and BT.

And the recent expansion into the UK of Netflix, which allows customers to pay to download movies, and the Lovefilm download and rental business adds a further threat to its model.

The new service was announced as Sky revealed a further slowdown in the number of households that signed up to its TV services to 40,000 in the three months to December 31, down from 140,000 in the same period a year ago.

However, underlying profits grew 16 per cent to a record £601m in the six months to December 31 as it sold more telephony and broadband packages to existing customers. Revenues rose six per cent to £3.4bn.

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Sky also announced it is to create 1,300 jobs over the next two years in the UK and Ireland as it brings more of its customer service and installation work in-house and opens a new service centre in Dublin.

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