indeed.

I have worked for various companies including one right now, who are making clear losses on their operations, the losses are simply to keep and ideally grow their userbase in the market they operate in, the end game is they get brought out for an overall profit. The vast majority of losses in this case is marketing spend.

The bigger the userbase is its always seen as more potential profit. There has been many big transactions in the past of companies where the company is making no profit or very little profit but the value is in the userbase.

In accounting terms it's known as "good will"...

Profit isn't everything. A firm may be worth £50k, but it may have a really loyal customer base, how do you value that? Well if investors are willing to pay £150k for that business, then we could say the customer base (assuming no other good will) is likely worth £100k.

I think Sky broadband was a loss making scheme for quite sometime when they initially began.

And O2 broadband wasn't?

We know where they ended up!

Sorry for the late reply...

Last November. My phone was with BT on Line Rental Saver but I wanted to upgrade to Fibre which meant moving my phone to Sky. They offered Fibre at £5 per month for 12 months but I said I wasn't interested since I didn't want to pay full price for line rental. I said I would leave and go to PlusNet instead. They then offered me the LRS deal.

fwiw, in answer to my original post, it looks like Sky is still prepared to offer £5pcm for another 12 months for those ex-o2 customers who just have unlimited ADSL (no line rental) on Sky LLU.

http://forums.moneysavingexpert.com/showthread.php?t...

Sky have scrapped the supplement for not having Sky TV for new customers. I'm guessing a lot of ex-O2 customers do not have Sky TV, so that gives Sky more wiggle-room for retention deals.