BSkyB Annual Review 2006Print this pageDownload PDF version

James Murdoch portrait

"
THE COMBINATION OF TECHNOLOGY, ENTERTAINING CONTENT AND THE CONTINUED DEDICATION OF OUR WORKFORCE HAS IMPROVED SUBSCRIBER GROWTH AND REVENUE, AND DRIVEN SHAREHOLDER VALUE.
"

James Murdoch
Chief Executive Officer
James Murdoch's signature





£4,148 million

SINCE THE LAUNCH OF DIGITAL IN OCTOBER 1998, REVENUE HAS GROWN AT AN AVERAGE OF 15% PER YEAR TO OVER £4.1 BILLION.





£1 billion

IN 2006, CASH GENERATED FROM OPERATIONS WAS MORE THAN £1 BILLION.





OUR SUCCESS FACTORS

LEADING EDGE INNOVATION THAT MAKES NEW TECHNOLOGY EASY AND ENJOYABLE TO USE

AN UNRIVALLED CHOICE OF SUPERB CONTENT, DELIVERED IN A WAY THAT PUTS THE CUSTOMER IN CONTROL

MARKET-LEADING CUSTOMER SERVICE THAT'S BACKED BY REAL INVESTMENT IN BOTH PEOPLE AND SYSTEMS

A BRAND PEOPLE KNOW AND TRUST TO GIVE THEM THE BEST IN HOME ENTERTAINMENT

Chief Executive's statement

This has been a year of significant changes - not just for Sky, but for the entire industry. Throughout the year, our focus has been on setting the pace of change, and re-affirming our appetite to continue doing so.

The development and launch of new products and services that are more flexible and of higher quality and value has been at the centre of this.

Our new high definition television service is one example. It represents the biggest revolution in TV picture quality in decades, and once again Sky is leading the field by being the first company to be able to offer the service nationally, across the widest range of HD channels, ranging from Sky Sports to Artsworld. And despite an early hiccup with one of our suppliers, the vast majority of our very first HD customers were able to enjoy the World Cup in glorious HD and Dolby 5.1 sound - and they loved it.

The acquisition of Easynet, completed in February, is another example of our commitment to innovation for our customers. It has prepared the way for Sky's new generation of broadband services. This is in addition to the already industry-leading technology that includes the much-loved Sky+ and, more recently, Sky by mobile.

With Sky Broadband we've designed an incredible product which both rewards our loyal customers with a quality service offering simplicity, flexibility, quality, and great value, and opens up new and substantial growth opportunities for the Company and all our shareholders. With special features like free wireless access, security, parental controls and an optional professional home installation across all packages, we're confident that Sky Broadband will be a simple choice for millions of our customers - creating a new dimension to our business whose potential we are only beginning to see.

Each of Sky's offerings sits at the top of the industry in terms of choice, quality and delivery. In every case, signs indicate that consumers are eager to take advantage of new services, allowing us to capitalise on our capabilities and deliver an unparalleled entertainment and communications proposition.

This year we also completed the implementation of our new customer management system. Our levels of customer service have always led the industry, and it has proven to be a key differentiator. By raising this bar even higher, we increase our competitive advantage - and we can bring new technology to the market faster, improve sales, provide better service for our existing customers, and increase the efficiency of our marketing. These and other customer-facing initiatives are vital to Sky's health and competitiveness.

All of the backstage activity that goes on at Sky will only be effective if we continue to invest in the reason that people subscribe to Sky for - an extraordinary package of onscreen content. This year we forged new deals with partners ranging from Disney to the England and Wales Cricket Board. Our partnership with Disney means we can now offer more family entertainment to Sky customers, while the advent of legal movie downloads mean our range and accessibility grows every day.

We also became reacquainted with some old friends - notably the FA Premier League and UEFA, with whom we have negotiated to continue two of the successful partnerships that have made Sky Sports the home of football.

These are just a few examples of the enormous activity and enterprise that Sky people invest every day into making what goes on screen for our customers the absolute best in its class.

We were busy on other fronts, too. This year we announced that, through the measurement, reduction, and offsetting of our carbon dioxide emissions, we have achieved carbon neutral status. It is the first commitment of this kind by a major media company anywhere. Caring about what our customers care about is at the centre of our community activity, and I am personally proud to be able to take such a firm stand on this issue, which is so important to all our people at Sky, and is a growing and important issue for our customers and their families.

The combination of technology, entertainment, and the continuing dedication of our workforce has improved customer growth, turnover, and earnings. We are healthy, strong and hungry and I look forward to the coming year and all of the opportunity it holds.

Thank you for your involvement.

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The Annual Review is a summary report on the full year to 30 June 2006, intended
for the investor not needing the full detail of the Annual Report.

As a summary report, the Annual Review does not contain sufficient information
to allow as full an understanding of the results and state of affairs of the Group as is provided by the full Annual Report.

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