Dresdner Kleinwort has marked BSkyB as a stock to avoid in 2007. In its State of the Nation report on European Media ‘Disruptive Innovation’, the investment bank says that the estimated 2.1 million Sky homes that are without broadband and do not subscribe to one of the Sky Sports packages must be considered as potential churners to BT’s bundled TV, broadband and telephony product. It says the satellite operator’s move into broadband should be regarded as a defensive move in a maturing multichannel television market.
The report points out that Sky’s premium subscriptions have stalled on around 5.7 million homes since January 2005.
On the positive side Dresdner lists ITV and publishers Reed Elsevier as key stocks to own.