Telewest digital setback

Cable operator Telewest Communications has admitted it will miss its digital television sales targets for this year.

The news sent the company's shares - which have already slumped in recent weeks - down 11% to their lowest levels since 1998.

They closed on Thursday at 155.75p, down from 175p and far below their peak in March of 563p.

The company had hoped to have 500,000 customers signed up by the end of this year.

But it said on Thursday it would take an additional three months to achieve its target because of a range of different problems, including a shortage of set-top boxes.

Telewest hopes to resume full sales of its digital television service in October and said it was unfazed about the setback.

Internet problems

"This is just a delay, not any kind of terminal event," chief executive Adam Singer said.

"Every single person who's gone through a transition from analogue to digital has gone through this kind of issue."

Digital sales so far total 223,000, with 179,000 already connected.

The company has also suffered problems with its internet services.

Blueyonder

Its unlimited internet access service launched earlier this year, was unable to cope with the demand and its systems had to be upgraded.

This led to long delays before would-be subscribers were connected to the service.

Telewest's high speed internet service, Blueyonder, a rival to BT's ADSL service, had also been plagued by "teething problems". It currently has about 1,000 subscribers.

The company said it was planning to cut the monthly cost from £50 to below £40 and launch a marketing push in the autumn.

Telewest also said that three Microsoft officials would join its board as non-executive directors after the software giant concluded the purchase of a 23.6% stake last month.

Fewer subscribers

Telewest's pre-tax loss in the six months to the end of June rose to £295.6m from £263.8m during the same period last year.

The deeper losses were largely a result of the company's switch into digital products from analogue.

But on a more positive note, revenues rose by 35% to £514m, with monthly revenues per customer rising 9% to £37.67.

But analysts said they were disappointed by a fall in the company's overall subscriber base.

The total number of television subscribers fell by 10,000 during the second quarter to about 1.1m as the company made the change to more digital services.