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Last Updated: Tuesday, 13 May, 2003, 11:25 GMT 12:25 UK
BSkyB profits surge
Sky Sports Digital
Sky Digital services are proving popular
Satellite TV giant BSkyB has reported a five-fold increase in quarterly profits.

Shares in the pay-TV company surged on the results, which were well ahead of market expectations.

More than 150,000 new subscribers signed up to BSkyB's services in the three months to the end of March.

And churn - the rate at which subscribers drop out - fell to a record low of 9.3%.

Football rights

The company said it was on target to hit 7 million subscribers by the end of its financial year, in June.

The average revenue per subscriber, known as ARPU, rose 7% to 364 on the strength of premium services such as Sky Plus.

Pre-tax profits rose to 65.8m ($105.8m) over the quarter, compared with 11.6m a year earlier.

BSkyB shares rose more than 1% to 685p, on the news.

The company, which is 36% owned by Rupert Murdoch's News Corporation, also revealed it was gearing up for the next auction of English Premiership football rights.

"I would think mid next month they would put out some sort of tender document," said chief executive Tony Ball.

EC investigation

He said he expected the sale to be wrapped up before the next football season starts in early August.

But much would depend on the progress of negotiations in Brussels.

The European Commission is currently investigating the way the Premiership sells its live television rights.

It has condemned BSkyB's monopoly over live rights as unfair and anti-competitive.

The Commission could force BSkyB to share that access with other broadcasters such as the BBC or ITV for the first time in more than 10 years.

Low key

Premiership football is key to Sky attracting new subscribers as well as hanging on to existing viewers.

The rights auction is likely to be much more low key than in 2000, when Sky was forced to pay 1.1bn for a three year contract of 66 games a season.

Cable operator NTL no longer has the financial muscle to enter the race, ITV Digital has collapsed and the BBC could not justify spending such a large amount of licence payers' money on one sport.

Mr Ball also pledged to secure a better value deal for English FA Cup games than the one it currently has.

In 2000, Sky and the BBC agreed to pay 400m for the TV rights to broadcast FA Cup games and England international matches for the three years from 2001 to 2004.

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