£60m for G.Networks Build of 1Gbps Broadband to 120,000 in London UPDATE

London focused UK ISP G.Networks and their investment partner Albion Capital have closed a new deal, which will result in Cube Infrastructure Managers (Cube IM) providing an “initial” £60m of additional funding to help roll-out FTTP “ultra-fast broadband” to serve 120,000 premises (“businesses and residents“).

Last year we reported that G.Networks were in the early stages of planning for the build of a new 1Gbps capable Fibre-to-the-Premises (FTTP) network (here and here), which aside from primarily digging their own cable ducts might also harness some of Openreach’s (BT) existing ducts (Physical Infrastructure Access) if deemed necessary. This network will then aim to serve small and medium sized enterprises (SMEs) in central London. Despite being a young company they’ve still managed to attract an investment of £4.6m from Albion.

At the time G.Networks said they’d already identified 200 streets (prioritising those with “significant business density“) where they could install their new fibre optic network and they hoped to connect another 70 streets by the end of 2017. Sadly today’s announcement makes no mention of whether this was delivered or how much take-up they’ve seen.

Nevertheless the ISP has still managed to bag another £60m of private investment via the Cube Infrastructure Fund II (Cube II) to help them “provide FTTP connectivity to more than 120,000 premises across London.” Interestingly the announcement also mentions residential connections for the first time.

Sasho Veselinski and David Sangster, co-Founders of G.Network, said:

“We are excited to be working with Cube Infrastructure, as reference shareholder. Cube is an outstanding partner, with a great experience in investing in FTTP projects and a like-minded approach to the development of communication infrastructure. This investment will ensure that we can roll out our network more quickly with a view to satisfying the demand from businesses and homes across London for our market-leading services.”

Henri Piganeau, MD of Cube Infrastructure Managers, added:

“G.Network represents a compelling proposition for the enormous number of businesses and also residents in London, who are chronically under-served by existing connectivity infrastructure. We look forward to working with G.Network’s management over the coming years to help the business develop its full fibre network and to significantly improve ultra-fast connectivity across London.”

The ISP intends to “[work] closely with Landlords and London’s councils to provide both new and existing buildings with fibre so tenants can enjoy gigabit connectivity from day one and at short notice,” although they still have a lot to prove first and Central London is already becoming aggressively competitive (e.g. Openreach (BT), Virgin Media, Hyperoptic, Community Fibre and others are all fighting over parts of it).

Apparently the new network will offer “shared access for all telecommunication operators including mobile network operators,” which overall makes it sound like a mix between Hyperoptic and Cityfibre’s differing approaches. We note that no time-scale targets have been set for reaching the 120,000 premises target or at least none were stated in their announcement.

Assuming their original statements still hold true then G.Networks will initially focus their work around the borough of Westminster and the City of London areas due to their “high concentration of SMEs, the burgeoning demand for high speed internet access and comparative lake of prompt FTTP connection.”

Suffice to say this is further proof that investors are currently quite keen to throw large sums of money at fibre optic broadband developments. This is good to know but we hope that plenty of due diligence is being done because ISPs really need to prove they can deliver first, particularly given some of the current markets challenges (skilled telecoms engineer shortages etc.).

UPDATE 23rd November 2018

G.Networks has informed us that they aim to provide full fibre connectivity, end to end, and to do so they will build their own cable ducts rather than harnessing Openreach’s existing cable ducts (the latter might still be used as an outside possibility but so far they’ve had no need for it). The reference to Openreach and PIA first appeared in their submission to Ofcom for Code Powers (here).