ITV Digital beats forecasts as <BR>600 jobs are cut

LONDON - Monkey could well be working for ITV Digital, which has beaten analysts estimates by signing up 46,000 new subscribers in the fourth quarter, as 600 jobs are cut.

This brings the total number of new subscribers to 1.263m. The increase has come on the back of the popular ITV Digital ad campaign featuring knitted woollen monkey, created by ad agency Mother, which has become somewhat of a cult hit with viewers.



ITV Digital, which is jointly owned by Carlton and Granada, said that penetration in pubs and clubs was continuing to grow, reaching around 20% of this important market with more than 1m customers watching UEFA Champions League in pubs and bars.



The 600 jobs cuts at ITV Digital are, the company says, mostly already made and that almost all have been achieved voluntarily during the current quarter, without jeopardising the quality of service to customers. This represents about 25% of

the company's workforce at its peak.



Rob Fyfe, ITV Digital managing director, said: "Our plan since April has been to deliver steady growth in subscribers and to control our cost base. These results demonstrate that we are achieving that aim."



The price increases for existing customers, which were implemented in January 2002, should increase ITV Digital's average revenue per customer by an average of about £25.



Three-month churn, at 24.9%, remains within ITV Digital forecast range. The net cost of churn to ITV Digital is substantially lower than for other platforms, because ITV Digital recovers the set-top boxes and recycles them.



During the quarter, the Discovery Channel was added and the penetration of ITV Sport Channel rose from 11% to 16%.



A number of manufacturers of set-top boxes are planning to produce low-cost products to receive free-to-air channels. ITV Digital is working with these manufacturers to ensure that these products meet acceptable standards and are capable of being upgraded to receive future services, including pay TV.



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