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£7.66bn of Private Funding Pumped into UK Gigabit Altnets

Tuesday, October 13th, 2020 (1:50 pm) - Score 1,536
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A new report from Point Topic and the Independent Networks Co-operative Association (INCA) has revealed that over £1.76bn worth of private funding, related to the alternative gigabit broadband sector, was announced during 2019 until September 2020 and that brings the total so far to £7.66bn.

At present around a quarter of premises (c.8 million) can currently access a gigabit-capable broadband network. Earlier this year INCA separately estimated that 15.73 million premises could be reached via alternative FTTP networks by the end of 2025 (here), although this is based more on future roll-out aspirations and so should be taken with a pinch of salt (DOCSIS 3.1 can also do gigabit speeds, as can some wireless networks).

NOTE: We don’t yet know how much overbuild will eventually exist between such networks and that will impact the overall level of UK coverage.

Overall, the new report shows that over £1.76 billion worth of private funding related to the independent network sector was announced between the start of 2019 and September 2020. These figures are on top of an estimated £5.7bn of private investment-related commitments that have already been made in the sector, bringing the total to £7.66 billion.

We should point out that these figures reflect financial commitments from altnets (e.g. Cityfibre, Hyperoptic, G.Network, Gigaclear and many others – see our summary), which excludes Virgin Media’s £3bn Project Lightning build (mix of FTTP and hybrid fibre coax) and Openreach’s recent pledge to plough £12bn into full fibre.

inca_altnet_investment_september_2020

However, it is important to note that these figures do not represent the whole sector, while the figures for capital spending are projected, not actual. Nevertheless, this shows just how much private investment is flowing into UK broadband right now and it’s important to keep that going (the more the private sector invests, the less the country will need from the public purse).

Malcolm Corbett, INCA CEO, said:

“This level of investment is really healthy for the industry and reflects how important the challenger networks are in keeping Britain connected. It also shows that the independent sector is playing a decisive role in getting as close to the government’s 2025 gigabit coverage target as possible.

To ensure that this momentum builds, it’s crucial that these operators are supported, particularly in rural areas, ensuring that the Government’s Outside-In funding policy succeeds and that all communities benefit from new digital infrastructure.”

The comments are somewhat intended to help balance against the picture that has been painted by the BT Group (example), which partly reflects an on-going debate around how the Government’s imminent £5bn gigabit broadband (F20) programme will work (here). At present the scheme is being setup with enough flexibility to support alternative networks, while BT would prefer an approach that is more favourable to their scale.

Admittedly though there are other challenges still to overcome, such as the need for a longer business rates holiday on new fibre and support to help create new engineers. “Just as important is having access to skilled workforce, a competitive market that includes challenger operators, and directing investment at areas that need it most,” said Malcom.

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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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1 Response
  1. GNewton says:

    With so much funding it is strange why this country is so hopelessly behind of where it should be with regards to fibre broadband coverage.

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