Virgin Media 2007 Annual Report Download - page 13

Virgin Media operates a content destination site, virginmedia.com, which is regularly in the top ten
of most visited sites in the U.K. and in the top 15 by page ranking. There is a broad base of content
available on our website, with a particular strength in sports content. For example, exclusive near-live
clips of English football programming over the internet are available on this website. We also use the
website to cross-promote our entire product range and to generate advertising revenues. Our customers
can access their broadband email services as well as customer care information through the website.
We also provide broadband and dial-up internet services to residential customers who do not
purchase our cable broadband service via BT’s local access network. Various price and feature packages
are available including broadband ranging from 512Kb to 8Mb, and metered and unmetered dial-up. As
of December 31, 2007, we had approximately 287,300 broadband customers using this service.
Fixed Line Telephone
We provide local, national and international telephone services to our residential customers who
are within reach of our access network by direct connection to our network. We enhance our basic
telephone service by offering additional services, such as call waiting, call barring (which prevents
unauthorized outgoing calls), call diversion (call forwarding), three-way calling, advanced voicemail,
caller line identification and fully itemized monthly billing. We also provide national and international
directory enquiry services.
In addition to a core line rental fee, we offer Size M, L and XL variants of our fixed line
telephone service as alternatives to straight usage-based billing. These packages include ‘‘Talk Plans’’
that enable customers to make unlimited local and national calls for a fixed monthly fee in addition to
the standard line rental. As of December 31, 2007, we provided on-net telephone services to
approximately 4.0 million residential customers.
We also provide phone service via BT’s local access network to customers not connected to our
network. As of December 31, 2007, we provided this type of telephone service to approximately 103,900
customers.
Sales and Marketing
We use a variety of sales channels to sell our services to residential customers, including telesales,
online and retail channels. Historically, telesales has been the single largest channel for consumer
product sales. We expect, however, growth in the proportion of sales coming from online and retail
channels. Retail channels include 13 of our own Virgin Media-branded stores as of December 31, 2007,
as well as retail distribution partners such as Zavvi (formerly Virgin Megastores), Carphone Warehouse
and Phones 4U.
Prior to the acquisition of Virgin Mobile, our consumer retail reach was limited to concessions and
third party retail channels. In 2007, we leveraged Virgin Mobile’s retail experience with the launch of a
series of Virgin Media-branded stores. In 2008, we expect to open additional Virgin Media-branded
stores.
These sales channels are supported by direct marketing initiatives and national and regional
television and press advertising. We use our residential customer database to identify the profiles of our
customers so that we can design offers to match the needs of our customers. As Virgin Media, we have
the scale and reach as a combined company to justify larger television and radio campaigns. Our offers
encourage customers to purchase new services and upgrade their existing services. Our marketing
balances acquisition marketing, or prospects, and customer marketing to ensure we optimize growth
from new and existing customers.
Since the February rebrand to Virgin Media, awareness of the ‘‘Virgin’’ brand as a telecoms/
entertainment supplier has increased steadily, reaching 90% amongst prospective customers in our
11