VMED to Launch Four HD Channels
Virgin Media (VMED) on July 13, 2009, announced that it will soon launch four new High Definition (HD) channels — LIVING, FX, MTV Networks International (MTVNHD) and National Geographic — which will be available to VMED’s 3.6 million TV customers. The first channel is scheduled to be launched by the end of July 2009.
Virgin Media intends to increase its High Definition (HD) capabilities in 2009 to cope with the increasing demand for HD. The company currently has around 300 hours of HD content on its Video on Demand (VOD) platform. This consists of around 60 movies at any one time and popular TV programs from the BBC and ITV. VMED recently added HD content to the BBC iPlayer service on its TV platform.
Since the first quarter of 2009, the company began the process of adding more HD channels, and is in negotiations with a number of broadcasters. Currently, VMED is in talks with UKTV about Good Food HD.
Virgin Media is a leading entertainment and communication business providing the first “quad-play” offering of television, broadband, fixed-line telephone and mobile telephone services in the United Kingdom.
The company has successfully launched ultrafast Internet speed up to 50 megabits, which is expected to be available across the network by the third quarter of 2009, with a view to offer content such as high definition programming on demand.However, the company may face competition from other players in the U.K. market who are already offering HD channels.
We maintain our Buy recommendation on the stock with a six-month target price of $7.75.
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