Virgin Media 2008 Annual Report Download - page 12

Cable Television
We offer a wide range of digital, or DTV, and analog, or ATV, television services. As of
December 31, 2008, we provided cable television services to approximately 3.6 million residential
subscribers, of which approximately 3.5 million received our DTV service and approximately 152,000
received our ATV service.
Our DTV service includes access to over 150 television channels, advanced interactive features,
and a range of premium and pay-per-view services. Our ATV service packages offer up to 60 television
channels, including premium services. In addition to offering the basic and premium pay TV channels,
we also offer our DTV customers one of the most comprehensive video-on-demand, or VOD, services
in the U.K. called ‘‘Virgin TV On Demand’’. See ‘‘Virgin TV On Demand’’ below.
Our network technology enables us to deliver a significant range of digital interactive services over
an ‘always on’ broadband connection from the network to a customer’s home. Examples of interactive
services provided include games, television email and access to news, entertainment and information
services from an on-screen menu. Interactive services also include enhanced television functionality
utilizing the ‘‘red button’’ applications from the BBC and other commercial broadcasters. ‘‘Red button’’
functionality in the U.K. permits television viewers to press a red button on their remote control
handset to receive additional interactive services including multiple broadcasts. For example, in a
Wimbledon tennis broadcast, a customer can press the red button and choose which match to watch.
We also offer ‘‘Free TV’’, a free-to-air digital television service, to certain of our customers on our
cable platform. Our Free TV service provides access to over 40 linear channels and radio services such
as Virgin1, Five US, Five, E4 and UKTV History as well as Setanta Sports News. In addition, Free TV
customers also have access to red button functionality and Virgin TV On Demand.
Virgin TV On Demand
Virgin TV On Demand is a significant enhancement to the standard DTV service, offering viewers
choice over and above scheduled programming without any requirement for new equipment, installation
or additional subscription fees. The VOD service provides access to thousands of hours of premium
movies, music videos, and TV programs and series on-demand. It appears within the electronic
programming guide, and can be accessed and viewed at any time via the remote control. The service
offers DVD-style features including freeze frame, fast-forward and rewind. These features provide a
customer with control over the content and timing of their television viewing. This service is available
to almost all of our digital customers. In 2008, our VOD usage increased to 52.9 million average
monthly views in the fourth quarter from 36.4 million average monthly views in the first quarter. Based
on management estimates, our customers who use VOD are less likely to churn.
There are three primary types of content available within Virgin TV On Demand, a portion of
which is refreshed on a daily basis. A selection of content is available free of charge to all of our DTV
customers, irrespective of package size. This is primarily focused within our ‘catch-up’ TV service which
offers a selection of more than 450 hours of top broadcast TV shows for no additional charge.
Additionally, all of our DTV customers have access to pay-per-transaction content including over 3,000
music videos and 500 current and library movies provided by ‘FilmFlex’. Pay-per-transaction movies and
music are available for 24 hours after purchase and may be viewed multiple times during that period
for a single fixed charge. Finally, DTV customers that subscribe to our XL Virgin TV package have
additional access to a subscription VOD, or SVOD, package which includes premium TV shows and
music videos, all included within the price of their monthly subscription. Customers on our other TV
packages can also receive the SVOD package on payment of a monthly subscription charge. In total,
we have over 4,600 hours of on-demand content.
10