Australia's major TV subscription provider Austar United Communications Ltd (ASX:AUN) has reported a 42 per cent drop in first-half profits.

The company's net earnings for the six months to June 30 edged down to $20.69 million from $35.5 million in the previous corresponding period.

Austar revenue climbed 6.3 per cent to $351.86 million.

Chief executive John Porter said subscriber growth was still meek in the second quarter, although there were positive signs that momentum had come back.

''As we work through this difficult consumer environment to regain our growth momentum, we have continued to exercise strong cost control, and this discipline is evident from our financial results,'' Mr Porter said in a statement today.

''The second half of 2010 will be an exciting time for Austar and its customers, with the 2010 Delhi Commonwealth Games showcased in HD over six dedicated channels, and the launch of a range of key programming that has traditionally connected well with subscribers.''

Total television subscribers surged to 747,148 following a net subscriber growth for the quarter of 3389, and an 18,429 rise compared with the first half in 2009.

Customer churn, meanwhile, edged down to 1.36 per cent from 1.4 per cent in the first half of 2009.

Closing the second quarter at $84.69, total average revenue per user rose 5 per cent.

According to Mr Porter, the digital switchover, which has already occurred in Mildura, will give an even bigger opportunity for the company as consumers demand a quality, multi-channel experience.

''In Mildura, for example, the number of sales and upgrades increased significantly in the months before analogue switch-off.''

Austar will not pay an interim dividend.