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Gigaclear Get GBP190m Boost for Rural UK FTTP Broadband Rollout

Friday, December 17th, 2021 (7:37 am) - Score 2,208
gigaclear fibre route engineers

Infracapital-backed alternative network ISP Gigaclear, which recently passed 250,000 premises in rural parts of  England with their gigabit-capable Fibre-to-the-Premises (FTTP) broadband network, has today secured another huge £190 million investment boost – this time co-financed by the new UK Infrastructure Bank.

The provider, which last year secured £525 million worth of debt financing to help fuel their future expansion plans (here), currently specialises in deploying into remote rural parts of the country – often at great cost – and aims to reach 500,000 UK premises with their full fibre broadband network by the end of 2023.

NOTE: Gigaclear’s network is currently present in rural communities and market towns across parts of Oxfordshire, Buckinghamshire, Hertfordshire, Herefordshire, Gloucestershire, Wiltshire, Berkshire, Somerset, Devon, Dorset, Northamptonshire, Lincolnshire, Leicestershire, Kent and Essex.

The good news is that, after today’s announcement, they may have enough funding to achieve the aforementioned target, extending into more communities across the South West, the Midlands and South East of England. Overall, the £100m from the UK Infrastructure Bank (UKIB) has facilitated £90m of private sector investment from five other lenders; ABN Amro, ING, Lloyds Bank, Natwest and NIBC.

In other words, the total facility of £190 million will support Gigaclear in their current rollout programme and deliver broadband to a further c.250,000 properties. Some 90% of these will be in hard-to-reach rural properties, which are currently underserved by the commercial market.

Julia Lopez MP, Digital Infrastructure Minister, said:

“Digital connectivity has never been more important and through our £5 billion Project Gigabit the government is levelling up communities with much faster broadband speeds.

But we can only complete this nationwide internet upgrade with the help of broadband firms such as Gigaclear. This significant investment in Gigaclear by the UK Infrastructure Bank brings us closer to making sure everyone benefits from new internet-connected technologies in the coming decades.”

Gareth Williams, CEO of Gigaclear, said:

“There are areas of rural England where the internet is around 1Mbps, that is slower than old fashioned dial-up speeds. Astronauts on the International Space Station have better internet access. This investment will help us bring our full fibre network to some of the most underserviced areas of the country that have been left behind in the dark ages of internet access, bringing them speeds of up to 900Mbps and beyond.

Its hard to put into words the level of impact this kind of upgrade has on communities, but in essence, it means rural businesses can thrive, people can work from home without issue, streaming services are actually usable, and loved ones can stay in touch over long distances. We’re grateful to the UKIB and our other investors for this show of confidence and look forward to lighting up more and more communities across the country.”

The UKIB, which was setup during June 2021 after first being announced in last year’s Spending Review, is designed to help crowd-in private investment for key infrastructure projects and follows a similar model adopted by the European Investment Bank (EIB), which the UK can no longer access. The “bank” was established via an initial £12bn in capital investment and £10bn in loan guarantees (some expect this to fuel a £40bn spending spree on infrastructure).

Today’s news marks the UKIB’s third major investment after it was recently used to support the UK’s wind-power supply chain through a loan to Tees Valley Combined Authority, and through its deal with NEXT Energy, which will help to potentially double the amount of subsidy-free solar power production across the country.

All of this means that Gigaclear is now well-placed to both achieve their next coverage target and to bid on any of the new contracts that may emerge under the Government’s £5bn Project Gigabit scheme. The latter aims to help make gigabit broadband speeds available to at least 85% of UK premises by the end of 2025 and universal coverage by 2030 (here), not least by focusing on those in the hardest to reach final 20% of premises.

UPDATE 11:34am

Adding a comment from UKIB.

John Flint, CEO of the UK Infrastructure Bank, said:

“The Covid-19 pandemic has underscored how vital reliable and good quality broadband is to every part of the UK. It’s an essential part of everyday life, as the UK increasingly relies on it for working from home, online shopping, and entertainment. This deal will not only benefit rural residents, but businesses based in the countryside too.

Nationwide full-fibre broad band will boost UK productivity significantly, support regional and local economic growth, and bring more people back into the workforce through remote working. We are very happy to support the Gigaclear programme alongside our co-lenders and are grateful for the support of Lloyds who acted as Coordination Bank with the UKIB for this specific transaction.”

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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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21 Responses
  1. Peter Jackson says:

    “There are areas of rural England where the internet is around 1Mbps, that is slower than old fashioned dial-up speeds.” As far as I am aware the fastest that could be achieved using dial up was 64Kb/s if you were using an ISDN line and a terminal adapter. In theory if you bonded the 2 ISDN 64Kb/s channels together you could achieve 128Kb/s. I’m not sure how you could achieve anything like 1Mb/s over a dial up line. Not that I am suggesting that 1Mb/s should be considered adequate for today’s Internet download speed.

    1. Mark Jackson says:

      Somehow I overlooked that part of his comment, but you’re absolutely right. 1Mbps is most definitely not “slower than old fashioned dial-up speeds,” unless somebody has fiddled with history and standards using time travel 🙂

    2. AnotherTim says:

      The statement is factually incorrect, but in its defence the impact of a 1Mbps connection with today’s traffic is actually worse than a dial-up connection used to be. Web sites used to be small and simple, without all the mass of data that now seems necessary for even the simplest page.
      I have worked from home from the early 90s with successive generations of dial-up, then bonded ISDN, then ADSL, ADSL Max, ADSL2+, then FTTC (36Mbps). Moving back to ADSL Max 8 years ago was a shock – and even when it was upgraded to USO level ADSL2+ a few years ago, was unusable even though it used to be adequate 15 years ago.

  2. AnotherTim says:

    “There are areas of rural England where the internet is around 1Mbps”, yes, and some of those are areas where Gigaclear have had the BDUK contract for over 5 years – and yet some of those areas are now being de-scoped. In Fastershire’s BDUK areas contracted to Gigaclear, 2,324 Herefordshire properties were de-scoped in November, and in Gloucestershire 1,187 are due to be de-scoped by January.
    To paraphrase Gareth Williams: it is hard to put into words what this sort of delay does to communities – businesses suffer, working from home is near impossible, and streaming service are unusable. Well done Gigaclear!

  3. Mark says:

    Looking forward to my connection with them, they’ve been down my estate already looking in the manholes. I may go for the full whack 900mbps service.

  4. HR2Res says:

    This truly beggars belief, says me, a descoped property owner in south Herefordshire with a flaky <2Mbps connection. How long before they Gigaclear-off another contracted build with this new finance?

  5. Furious, Herefordshire says:

    All the PR puffery in the world will not fool anyone round here about Giggle and Clearoff. They walked away from their commitments at the last minute leaving a large chunk of Herefordshire stuck for many more years with almost non-existent broadband. They are punished with yet more chunks of taxpayers’ money. They laugh, we cry. Don’t trust them an inch.

    1. Optimist says:

      All the more reason to incentivise ISPs to invest by reducing taxes and regulations rather than giving away taxpayers’ money.

    2. AnotherTim says:

      I disagree. In order to ensure overall coverage rather than the cherry-picking of profitable areas we need more regulation, and cross-subsidies from profitable areas to cover the extra costs of the “unprofitable” areas.
      The fact that the “levelling up” process has so far increased FTTP coverage of FTTC enabled areas while leaving the sub-USO areas largely untouched shows the current plans aren’t having the required effect, and are in fact achieving the exact opposite of “levelling up”.

    3. New_Londoner says:

      I can see why those people still waiting for Gigaclear to deliver after years of repeated delays are so frustrated.

      The Fastershire local authority team seem intent on competing with their counterparts in CDS for the most incompetent project team of the year award. Surely it’s well past the time when Gigaclear should face financial consequences for non-delivery rather than being rewarded with new contracts and more funds.

    4. HR2res says:

      @Optimist How much more of a break does a company require than to be able to dip into local and national government-provided funds specifically to lay fttp to hard-to-fttp areas and then not to accomplish that? All a tax break will achieve is to bolster the company bottom line while encouraging them to look at more easier-to-fttp areas sooner.

  6. Ex Telecom Engineer says:

    What interest rate will these loans come in at? Apparently the UK Infrastructure bank interest rates are set at “at a rate of gilts + 60 bps”, so is that 10 year gilts + 0.6%? I assume the Gilt Yield will rise with interest rate increases, so I’d guess there’s some risk around interest rate rises. What are the interest rates for the “£90m of private sector investment”?
    Does this suggest that Gigaclear have struggled to raise cash through the Private Bond markets? Since the UKIB’s aim is to help projects struggling to acquire finance by assuming some of the revenue risk and crowding in other investors.

  7. anon67884 says:

    Hi Gigaclear,

    With today’s announcement, I hope you will consider rolling out your network to Bewdley and surrounding areas, you’d be very welcome here 🙂

    There’s no plans for Openreach to upgrade our area to FTTP until 2026!

    1. The Facts says:

      To be built between April 2021 and December 2026.

  8. 1pf says:

    Failing here with faster(failure) between Huntley and Ross. We have been waiting over seven years since the initial sign-up with BT/OR and even through we have been promised and promised still waiting. Profitable areas linked even on the BDUK money…feet should be held to the fire and ensure accountability as they and Fastershire are failing communities.

    1. AnotherTim says:

      It depends on just where you are, but l,187 properties in the Newent to Ross are are due to be de-scoped for Gigaclear’s build (including 50 in the Huntley area). See https://glostext.gloucestershire.gov.uk/documents/s77580/Gloucestershire%20ICM%20Decision%20Fastershire%20Dec%202021%20-%20Final.pdf for details (with a map on page 7).
      These properties will be added to a new Stage 6 – which will probably become part of the BDUK Project Gigabit scheme (eventually).

    2. New_Londoner says:

      @1pf, AnotherTim
      Have you considered approaching the National Audit Office and, perhaps more usefully, the Public Accounts Committee? It seems to be well past the time when both Gigaclear and the local authorities should be held to account for their repeated non-delivery within the Fastershire project.

    3. 1pf says:

      Looks as though we are going to be de-scooped based on the poor map ..will be checking again. This really is pathetic!

      Currently get 4meg via BT and not much better with 4G with an external!

      Thank you for the replies.

  9. Him says:

    It is certainly the case that the Fastershire team have been naive and incompetent. And Gigaclear exploited that to renegotiate their much delayed contract a few years ago and then renege on part of it when it suited them. The only upside, as one of those affected, is that when I do eventually get better broadband, through Project Gigabit (now some years off), it might be with an honest and competent supplier rather than an incompetent rogue.

    I hope that whatever contractual penalties Gigaclear are exposed to are enforced to the fullest extent and that Fastershire do not cave in again.

  10. HR2res says:

    If only it were the case that “The only upside, as one of those affected, is that when I do eventually get better broadband, through Project Gigabit (now some years off), it might be with an honest and competent supplier rather than an incompetent rogue.”

    The new debt finance means that Gigaclear-off could, theoretically at least, bid to rescope their recently descoped properties under Project Gigabit.

  11. Pauline Carr says:

    interesting that Gigaclear can overbuild where it suits them, as we have been told that they are unable to overbuild! We have a contract with Gigaclear to provide fibre to our little ‘neck of the woods’ just 5 miles from Shipston, but because BT/OpenReach started to fibre up a small proportion of properties here allegedly under a USO (claiming they knew nothing about the Gigaclear arrangement) we have been left high and dry. BT refuse to finish off the balance of our community and Gigaclear are currently saying they cannot as they are unable to overbuild. They will not return telephone calls, and complaints fall on deaf ears!

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