ITV Digital churn

Dec 2001: 24.9% Sept 2001: 23.1% June 2001: 23% Source: ITV Digital

The increase in disconnections, to 24.9% from 23.1% in the previous period, means that if the rest of the year were to reflect this quarter nearly one in four users would give up their subscriptions over the 12-month period.

It is likely to get worse before it gets better. Churn will rise to 30% later this year before improving, a company spokesman predicted.

In a bid to cut costs, the company will lay off 600 people, instead of the previously announced 550, at its Plymouth call centre.

More customers

ITV Digital now has 1,263,000 customers, up from 1,217,000 at the end of September.

Although the pace of subscriber acquisition has slowed, it was nonetheless better than some analysts had been expecting.

"Our plan since April has been to deliver steady growth in subscribers and to control our cost base. These results demonstrate that we are achieving that aim," said managing director Rob Fyfe.

ITV Digital aims to reduce churn to 20% by the end of 2003 and to break even by 2004.

Carlton shares gained 1p to 207.5p while Granada shares gained 2.25p to 120.25 by 0835 GMT.