REVENUES AT UPC Ireland, owner of the NTL and Chorus cable television platforms, rose by 7.6 per cent in the first six months of this year in spite of a sharp drop in the number of people subscribing to its television packages.

Figures released yesterday show that UPC achieved revenues of €120.1 million in the six months to the end of June, up from €111.6 million for the same period of 2007.

In terms of customer numbers, UPC had 562,600 television subscribers at the end of June - a decline of 16,000 on the quarter to the end of March.

UPC's TV customer base has fallen by about 24,000 over the past 12 months. If the current rate of decline continues, UPC could shortly be overtaken by Sky as the biggest provider of pay television in Ireland.

Sky has more than 550,000 subscribers here and continues to grow its business. Unlike UPC, however, Sky does not provide broadband or telephone services in Ireland.

The decline in UPC's television customer numbers was across the board. The company had 7,700 fewer analog cable subscribers and 2,900 fewer digital customers.

Its MMDS service was taken by 5,400 fewer homes at the end of June compared with the quarter to the end of March.

The drop in digital TV subscribers will worry the company most, given that this is more lucrative than its basic analog service.

There was better news from UPC in terms of its broadband and telephone services. The company had 89,300 broadband subscribers at the end of June, an increase of 2,900 on the quarter to the end of March.

The company also had 18,500 telephone customers from a potential subscriber base of 298,100. It added 4,600 telephone customers in the three months to the end of June.

Robert Dunn, chief executive of UPC Ireland, acknowledged that the company's television subscriber base was declining. He said the reduction in customer numbers was due to increased competition and the downturn in the number of new homes being built.

"It's definitely a competitive environment," he said. "The main area of growth for us has been in broadband and telephone. But we've just started to promote a new €20 [ a month] entry level digital TV product across Ireland, which will be the cheapest available in the market."

UPC's operating cash flow in the first six months of this year was €45 million, compared with €35 million in the same period of 2007.