The BSkyB change of strategy announced last August by James Murdoch has claimed its first victim according to this report: the company's own original target of 30% operating margin by FY 2006/07. That leaves the company with just two of its core targets: £400 ARPU and 8 million subscribers by the end of 2005. Meanwhile, the profit target has been replaced by the long-term growth target of 10 million Sky Digital subs by 2010, over 25% with Sky+ boxes and more than 30% with multiroom subs.

This in-depth report on pay-TV in France charts the course of Canal Plus and its main, but much smaller, competitor, TPS, over the period 2004-06. We anticipate pay-TV penetration will rise from 35% in 2003 to 38.7% by 2006, driven mainly by aggressive competition between TPS and Canal Plus in an improving economic environment.