Sky Deutschland back in the black, plans on-demand service

Sky Deutschland has returned to profit in the quarter to September and announced plans to bring all the content on its Sky Go and Snap on-demand services to TV via Sky+ boxes.

Sky turned in a positive net income of €12 million for its first fiscal quarter, against a loss of €14 million last year, driven by an overall rise in revenues of 10% to €431 million against a rise in costs of only 4% to €377 million.

Following to launch of its new OTT TV service Sky Online, Sky has also unveiled plans to make its entire on-demand offering available to Sky+ DVR subscribers. Sky already offers a more limited on-demand service, Sky Anytime, to Sky+ users, but is now expanding the range of content available with Sky On Demand, which will replace the latter service.

According to Sky Deutschland, Sky On Demand will see a six-fold increase in the amount of on-demand content available by the end of this year, available via a new user interface.

The move is the latest in a series of initiatives by Sky to counter the appeal of services such as Netflix, the most recent being the launch of Sky Online. In August, the pay TV operator reduced the price of its Snap by Sky online VoD service to €3.99 and introduced a new Snap Extra download option.

For the quarter to September, Sky added 96,000 direct-to-home subscribers, taking its total to 3.9 million. Sky+ customers increased by 105,000 to 1.786 million, while Sky Premium HD customers were up 75,000, ending the quarter at 2.311 million. Quarterly annualised churn fell from 12.5% to 8.6%.

Sky confirmed its full-year 2014-15 target of 400,000-500,000 new subscribers and EBITDA in the range of €80-110 million. For the first quarter, the operator posted EBITDA of €54 million, up 86%.

Sky said it expected its acquisition by BSkyB to close by the middle of this month.

“This quarter marks a number of important milestones at Sky. We have once again delivered strong customer and EBITDA growth, as well as a positive net income, as more and more customers are enjoying our outstanding offering,” said CEO Brian Sullivan.

“High-quality exclusive content, continuous innovation and a great customer experience are the pillars of our sustained success. We’ve also just unveiled the next wave of exciting new services, Sky Online and Sky On Demand, which bring a whole new level of choice, flexibility and control to our existing and future customers. There has never been a better time to be a Sky customer.”