Virgin Media 2006 Annual Report Download - page 13

Our wholly−owned, local access communications network provides us with several competitive advantages in our addressable
markets:
• it provides real two−way interactivity with residential customers who are connected to the network;
• it enables us to provide true “triple−play” bundled services of television, broadband, and fixed line telephone services to
residential customers in our franchise areas without relying on another service provider or network; and
• our twin cable, consisting of both coaxial and twisted copper pair elements, provides us with the flexibility to deliver
broadband and high−speed services over either coaxial network or copper. Currently we provide our services over coaxial
cable, which allows us to provide a superior broadband experience to our customers. Our principal competitors rely solely on
the inferior copper pair technology over which broadband speeds can significantly diminish with distance from the local
exchange.
In contrast:
• direct to home satellite service providers do not have the capacity to offer two−way interactivity except by adding a phone line
from another service provider or other cable facility; and
• telephony service providers today have only a limited capacity to provide video over existing digital subscriber lines, or DSL,
technology without significant capital investment in their network.
Multi−Service Bundles
Virgin Media was the first U.K. provider of a residential “triple−play” offering of television, broadband and fixed line telephone
services. Our packaging and pricing are designed to encourage residential customers to purchase multiple services from us and we
frequently offer discounts to customers taking two or more products from our portfolio. As of December 31, 2006, more than 75% of
our residential on−net customers received multiple services from us and approximately 41% of our on−net customers were
“triple−play’’.
With our acquisition of Virgin Mobile in July 2006, Virgin Media is now able to offer the U.K.’s first “quad−play” of television,
broadband, fixed line telephone and mobile telephone services to residential customers. We have already introduced our first
“quad−play” bundles into the market, and expect to drive both mobile and cable penetration through the two customer bases by
applying our past experience of cross selling products. See “Mobile Segment” below.
As part of our rebrand, we renamed our product offerings and bundles so they are easy to understand. For each of our products,
we have a range of packages and tariffs for customers to choose from and have labeled them as Medium (M), Large (L) and Extra
Large (XL). For example, we currently offer a 2Mb broadband service as Medium, a 4Mb service as Large and a 10Mb service as
Extra Large.
Cable Television
We offer a wide range of digital, or DTV, and analog, or ATV, television services. As of December 31, 2006, we provided cable
television services to approximately 3.3 million residential customers, of which approximately 3.0 million received our DTV service
and approximately 0.3 million received our ATV service.
Our DTV service includes access to over 130 channels, advanced interactive features, and a range of premium and pay−per−view
services. Our ATV service packages offer up to 60 channels, including premium services. In addition to offering the basic and
premium pay TV channels, we also offer one of the most comprehensive Video on Demand, or VoD, services in the U.K. to our DTV
customers called Virgin
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Source: VIRGIN MEDIA INVESTM, 10−K, March 01, 2007