Cityfibre and toob Sign Mutual UK Full Fibre Network Access Deal UPDATE

Alternative network builders Cityfibre and toob have today signed a unique network access agreement, which will see both sides aiming to benefit from each other’s deployments of their respective gigabit-capable Fibre-to-the-Premises (FTTP) broadband ISP networks across the UK.

Just to recap. Toob currently aims to cover 1 million premises across the South of England by 2027 with their full fibre network – they’re already deploying across several towns and cities in Surrey and Hampshire. By comparison, Cityfibre aim to cover 8 million premises – across around 285 cities, towns and villages (c.30% of the UK) – by the end of 2025 (here).

Until now, both operators would have been considered competitive rivals in the altnet space, but all that has just changed. The new agreement will enable toob to extend their successful retail broadband packages across Cityfibre’s national footprint, starting with Portsmouth today (inc. Southsea, Fratton, Milton, Eastney, Copnor and Burrfields), before launching in areas that are adjacent to its own rollouts.

On top of that, the operators have also agreed ‘Heads of Terms‘ for a wholesale aggregation partnership, which will see toob’s current and future network builds being incorporated into Cityibre’s ‘Ready for Service’ (RFS) footprint (i.e. ISPs on Cityfibre’s network will gain access to toob’s network patch).

In theory, this should result in better overall coverage, as the two will no longer need to compete via overbuild and can instead spend on deployments into areas where they are not rivals – each party will now benefit from such expansion.

Greg Mesch, Chief Executive Officer at CityFibre, said:

“We are delighted to welcome toob on board as a service provider partner on our networks. They’ve had great success driving take-up of their services and we look forward to helping them extend their exciting service proposition to millions of new homes over our network.

This deal also represents the UK’s first major partnership between infrastructure builders, establishing a new model of wholesale aggregation that significantly accelerates and expands the addressable footprint available to our wholesale ISP partners. For smaller fibre network builders which currently only offer their own retail broadband services across their footprint, it also establishes an opportunity to expand their retail offering, opening a lucrative wholesale revenue stream and maximising take-up over their network.”

Nick Parbutt, CEO & Founder of toob, said:

“toob is delighted to be partnering with CityFibre. Opening our own network to other ISPs has been part of our strategy from the outset, and partnering with CityFibre allows ISPs to access the toob full fibre network. Likewise expanding our very successful brand and proposition in the region by using CityFibre’s Network provides a great opportunity to capitalise on our investment in the region, offer our proposition to more customers and ultimately grow the company.”

The technical integration of toob’s footprint is expected to be completed by summer 2023 and will provide CityFibre’s ISP partners with access to over 100,000 homes across Southampton and Camberley where toob is already live. But toob said they remain committed to building a network to more than a million premises across the South of England over the next 5 years, “all of which will be made available to CityFibre’s ISP partners at the same service levels as CityFibre’s own network.”

The announcement comes a full year after we reported on market speculation that suggested CityFibre were in discussions with rival toob over a possible deal, although at the time it was unclear whether this would result in more consolidation or something different. Clearly, this is something different, and we can’t help but wonder whether there may be more mutually beneficial agreements like this in the future.

However, this does raise a question mark over whether toob will be able to sell their £25 per month 900Mbps plan into Cityfibre’s areas (£29 after 18-months), since that would appear to undercut a lot of Cityfibre’s existing wholesale partners at the retail end (prices of £35-£45 are more common for their retail gigabit tiers). We suspect that toob may need new packages for CF areas, either that or CF may reduce their wholesale charges.

UPDATE 12:16pm

Toob has put out their own press release, which confirms that those on the Cityfibre network in Portsmouth (inc. Southsea, Fratton, Milton, Eastney, Copnor and Burrfields) can indeed get access to their £25 per month package (symmetric speeds of 900Mbps). We imagine that this may irritate some of Cityfibre’s other wholesale ISP partners, which, as above, tend to be a fair bit more expensive for the same sort of tier.

Interestingly, toob’s website expresses their current price as a ‘Black Friday’ offer, except they’ve been offering 900Mbps at the same price for a long time.