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Three UK Acquire Fixed Wireless 4G Operator UK Broadband Ltd for £250m

Monday, February 6th, 2017 (4:49 pm) - Score 2,611
uk broadband pccw

Mobile operator Three UK has today announced a surprise deal to acquire UK Broadband Ltd. (PCCW), which operates fixed wireless broadband ISP Relish Wireless via a 4G based network in Swindon, Reading and central London using spectrum in the 3.5GHz to 3.6GHz bands.

UK Broadband Ltd. has long held an aspiration to launch a truly national UK network (they already have the licences), although so far the business has struggled to turn that dream into a reality and they’ve been bleeding an awful lot of money on it. UKB’s results to 31st December 2015 showed revenue of £3.28m (up from £1.53m in 2014) and an operating loss of £25.07m (£24.16m in 2014); this loss rises to £37.4m when you include other losses (e.g. foreign exchange).

However UKB has remained upbeat and their results highlighted that the spectrum they own (this also includes some in the 3.9GHz, 28GHz and 40GHz bands) could also start making it into modern handsets (Smartphones etc.) from the end of 2017, which they saw as being a big potential area of future growth and no doubt this is something that might have attracted Three UK.

On top of that Ofcom have already signalled that some of the spectrum in related bands could be used for future 5G Mobile services. Suddenly this deal starts to make a lot of sense.

Dave Dyson, CEO of Three UK, said:

“UK Broadband gives us an opportunity to expand our ambition to provide high quality and great value internet connectivity for UK consumers.”

The situation does of course raise a rather significant question mark over the future of UKB’s Relish Wireless ISP, which represents a different proposition from what Three UK is used to dealing with. According to the press release, UK Broadband Ltd. provides broadband access to 15,000 customers in the UK and will now become a wholly owned subsidiary of Three UK.

The transaction is expected to complete by mid-2017 and Three UK will pay £250 million upon completion. A deferred £50 million will also be made available as a credit toward an MVNO agreement on Three’s network.

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Mark Jackson
By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.
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6 Responses
  1. Avatar Alloneword

    Wonder how this will work out, just invested in some hardware to pick up their signal, not to mention paid for installation and for the first time have a decent signal, oh well just my luck.

    All1

  2. Avatar Henry

    Clearly there are other individuals and companies involved, but the Financial Times is reporting this as Richard Li of PCCW selling to his father Li Ka-shing of CK Hutchison

    • Avatar Steve Jones

      The Telegraph business section has a similar story. It would appear that the richest man in Asia is saving his son’s blushes in what has been a disastrously expensive exercise. Apparently the £250m will mean the son’s investment has just about broken even. It also seems that the most valuable asset is the bandwidth that the company owns. If that becomes part of the allowed 5G spectrum, then it could yet prove to be a major asset.

  3. Avatar Chris

    124mhz in the 3.5-3.7ghz band. Snapdragon 835 will support these bands this year, along with 4x20mhz CA. Add on 4×4 MIMO and 256QAM, Three basically just purchased a pre-built gigabit LTE network in London.
    Someone better call Sharon!

  4. Avatar Chris P

    More pieces of the 5g broadband puzzle falling into place.

  5. Avatar Dave

    3 might never have a real 4G network but they might end up being an early leader for 5G.

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