Sky ups the ante with increased marketing spend

In an effort to win subscirbers away from competitors, Sky has upped its promotional spend by £13 million.

According to city analysts Morgan Stanley, Sky's total spend on marketing, which includes staff costs and the price of subsidising its set-top boxes, has to risen £90 million in the first nine months of this financial year to £564 million, compared with £474 million for the same period last year.

Sky spent almost £29 million on advertising in the first quarter of this year, compared with £20 million in the same period last year, according to Nielsen Media Research.

The company is due to reveal its third-quarter results this week, and is expected to to reveal churn rates have risen from 11.9% to as high as 14%, its highest for ten years.

Sky is still expected to have signed up more customers than it has lost during the quarter, adding 183,000 subscribers in the last three months of 2006, taking its total to 8.44 million.