TalkTalk has confirmed it will begin connecting homes and businesses this autumn to its trial ultra-fast broadband network in York, saying the group is in talks for a national roll-out to 10m households.
Homeowners and small businesses will be offered the kind of bandwidth normally used by large office buildings, enabling a high-definition film to download in seven seconds or 100 songs in three seconds.
Built in partnership with Sky and CityFibre, the pilot network in York has fibre-optic cables which run to the front door, meaning it can operate at up to 1 gigabit per second – more than 100 times faster than the national average for broadband.
“Our preliminary discussions on financing such a scale roll-out have been positive, underscoring our confidence in the opportunity for building an economically viable, alternative and superior fibre infrastructure to that available today,” TalkTalk said as it announced full-year results on Thursday.
Shares in the company rose 5% in morning trading as revenue growth exceeded expectations, increasing 4.2% to £1.8bn, and underlying earnings rose 15% to £245m. Profits at the pay-TV and telecoms company have been boosted by a series of price increases over the past 12 months, with the Plus TV and broadband package up from £15.50 at the beginning of 2014 to £20 from June.
Despite protests from customers about increasing costs, the turnover of subscribers has fallen to its lowest level. TalkTalk said it remained on track to achieve 25% underlying earnings margins in 2017, and raised revenue growth guidance over the next two years to 5%, from 4%.
In the quarter to 31 March, a further 82,000 net new customers signed for the TalkTalk TV service, which was boosted this year when the company acquired Tesco’s Blinkbox internet TV division. The offering will be bolstered by a new deal for series one to four of the hit show Game of Thrones, which will be available to buy over Blinkbox after a deal with the US network HBO.
TalkTalk has 1.4 million television customers, cementing its position as the third largest pay TV company in Britain, after Sky and Virgin Media and ahead of BT, which has used sports to help boost its numbers to 1.14 million customers.
Phone and broadband customers increased by a net 47,000 in the quarter, and mobile by 66,000, while those signing up for faster fibre-optic internet increased by 83,000.
TalkTalk’s chief executive, Dido Harding, renewed calls for regulatory action against BT. She has campaigned for the former state-owned telecoms network to reduce the price at which it leases broadband lines to other internet companies, and has argued for its Openreach division, which operates and maintains the network, to be spun off into a separate company.
Harding said: “We believe firmly that competition will drive the innovation and investment that Britain needs in this essential infrastructure and urge the respective regulatory bodies currently reviewing the various mergers and industry structure, to put strong competition at the heart of their decisions.”
