BSkyB needs 150,000 ITV Digital customers to offset revenue loss

LONDON - BSkyB will need to convert 150,000 former ITV Digital customers to its satellite service if it is to try to recover the £70m it will lose in revenues following the demise of the digital terrestrial broadcaster.

BSkyB has already lost a substantial amount as one of ITV Digital's creditors. The terrestrial service was placed into administration on March 27 and until last week BSkyB, along with other channel suppliers, provided its channels for free.

As yet, there has been no sign of a replacement commercial digital terrestrial TV broadcaster, and BSkyB looks set to lose the £70m a year it earned from advertising revenues and programme sales.

In order to recover that amount, analysts suggest it will need to convert 150,000 of ITV Digital's top tier of customers.

Neil Blackley, media analyst at Merrill Lynch, said: "We see BSkyB picking up some of ITV Digital's premium customers, which should partly offset the effect [of the loss of business]."

Last week, BSkyB said it would take a charge of about £22m in the third quarter in relation to loss of earnings from ITV Digital. BSkyB recently announced 2001 losses of £1.26bn to account for a £1bn write-off of its 22% stake in troubled German media company Kirch.

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