BSkyB reports big jump in profits

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Media captionBSkyB chief executive Jeremy Darroch on how customers are taking more services

BSkyB has reported a 26% jump in half-year pre-tax profit as its number of customers moved above 10 million.

Pre-tax profits at the broadcaster rose to £467m in the last six months of 2010, with revenues up 15% to £3.2bn.

Earlier this week, Culture Secretary Jeremy Hunt said he intended to refer a bid by News Corporation for BSkyB to the Competition Commission.

But he has given News Corp extra time to address concerns he has regarding "potential threats to media plurality".

In the past few days, BSkyB has sacked football pundit Andy Gray and seen presenter Richard Keys resign following a row over sexist comments.

'Outstanding performance'

BSkyB said increased demand for high definition (HD) television services - up by 68% on a year ago - had boosted results.

And more customers were also opting to buy broadband internet access and phone services from the firm, as well as television, adding to "a half year of outstanding performance", said chief executive Jeremy Darroch.

He told the BBC it was "very encouraging" that the company's customer numbers had risen above 10 million.

But he added that being "more broadly based", offering communication services as well as pay television developments such as 3D and on-demand viewing would be key to future growth.

"It's not just about adding more households, though we will do that," he told the BBC. "It's about increasing the penetration of products in our customer base."

However, BSkyB said it was taking a "cautious view" for 2011, as the impact of government spending cuts fed through to consumers.


News Corp already owns a 39% stake in BSkyB and is trying to buy the rest of the business. It also owns four UK newspapers - the Sun, the News of the World, the Times and the Sunday Times.

News Corp made an approach in June to take full control of BSkyB, but Business Secretary Vince Cable stepped in to refer the deal to Ofcom on public interest grounds.

However, the responsibility for a final ruling on the proposed merger has since passed to Mr Hunt, after Mr Cable was recorded by undercover journalists saying he had "declared war" on News Corp's owner, Rupert Murdoch.

As the battle for BSkyB intensified, Mr Murdoch cancelled a trip to the annual meeting of the world's business and political elite in Davos, Switzerland.

It has been suggested that News Corp would agree to sell off Sky News if it bought BSkyB, in an effort to appease concerns over domination of news.

BBC business editor Robert Peston said that if the culture secretary insisted this was done before the sale of BSkyB to News Corp was allowed, this could lead to News Corp being forced to pay about £1bn more for its target.

Richard Keys resigned as a Sky presenter on Wednesday following his comments about female referee Sian Massey - and after the release of further damaging, unbroadcasted, material.

Pundit Andy Gray, 55, had already been dismissed by the broadcaster after further allegations of sexist behaviour from the former striker came to light.

Mr Darroch told the BBC it was "particularly disappointing of course over the last few days to see some of the language and behaviour that came out".

"We've got very clear standards around what we expect, the culture we're trying to create at Sky, and unfortunately they were examples of inappropriate behaviour, wholly inappropriate behaviour."

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