28 Oct 2014

Sky tipped to outperform share market

1:52 pm on 28 October 2014

Sky Network Television's share price is expected to perform better than the share market generally over the next 12 months, as it moves closer to doubling its content capacity and launches new services.

Sky will upgrade all its subscribers to internet-enabled MySky decoders, from early next year, which will cost about $100 million over 18 months.

The upgrade will double Sky's useable satellite capacity, so it can deliver richer content.

Sky is also launching Neon, an internet-based, on-demand, movie and television service aimed at non-subscribers, which is available at $20 a month, without a contract.

Forsyth Barr's media analyst Blair Gaplin said the changes will strengthen Sky's market position and improve its ability to retain customers.

He said it is a lot cheaper to keep a customer than win a new one, and for any company "return churn" is critical.

Sky TV's shares rose as much as 7 cents this morning to $6.20 after gaining 20 cents on Friday.

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