Virgin Media O2 Sees Project Lightning Add 3 Million UK Premises
The latest Q3 2022 results from broadband ISP and mobile giant VMO2 (Virgin Media and O2) has seen their fixed broadband base reach 5.63m customers (up by 19.1k in Q3 vs 16k in Q2), while their gigabit network coverage added 115,000 premises (3 million delivered via Project Lightning) and 5G is available in over 800 towns and cities.
The biggest development for VMO2 over the past quarter has been their creation of a new Joint Venture, which aims to build a wholesale focused Fibre-to-the-Premises (FTTP / XGS-PON) broadband network to cover “up to” 7 million additional UK homes (here). On top of that, they also got into a legal tussle with BT over mobile migrations (here) and have boosted some of their broadband speeds (here).
More recently, VMO2 has also extended their testing of OpenRAN mobile technologies to field trials (here), started to make their broadband services available at existing OFNL sites (here), improved their ‘Essentials’ social tariff to be cheaper and offer 50Mbps speeds (here) and they also claim to have launched the country’s “Fastest WiFi Guarantee” (here) – even though it’s not actually the fastest.
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Finally, the operator also appears to have shelved a proposed £3bn merger with TalkTalk (here) and they’re considering a sale of their 50% stake in mast operator Cornerstone (here).
Quarterly UK Customer (Connection) Figures – Q3 2022
5,631,100 Fixed Broadband – (up from 5,612,000 in Q2)
44,155,100 Mobile inc. Wholesale – (up from 43,526,400)
Elsewhere, the operator’s Project Lighting network expansion has now reached an additional 3 million premises since it began some years ago (c.1.7 million via FTTP and the rest as Hybrid Fibre Coax), and their quarterly pace of build has been fairly flat. As a result of this, VMO2’s fixed line network now covers 15.98 million UK homes passed (during the whole of 2022 they expect to add a total of 500,000 premises).
Project Lightning Rollout Since 2017
Q3 2022 = 115,000 Premises
Q2 2022 = 114,000 Premises
Q1 2022 = 101,000 Premises
Q4 2021 = 93,000 Premises
Q3 2021 = 67,000 Premises
Q2 2021 = 89,000 Premises
Q1 2021 = 80,000 Premises (impacted by COVID-19 lockdown)
Q4 2020 = 115,000 Premises (some impact from COVID-19)
Q3 2020 = 125,000 Premises
Q2 2020 = 93,000 Premises (impacted by COVID-19 lockdown)
Q1 2020 = 93,000 Premises (some impact from COVID-19)
Q4 2019 = 154,000 Premises
Q3 2019 = 119,000 Premises
Q2 2019 = 130,000 Premises
Q1 2019 = 102,000 PremisesNOTE 1: Between Q1 2017 and Q4 2018 Virgin added 1,017,000 premises under Project Lightning, which is an average of 127,125 per quarter.
On the financial front, VMO2 reported total transaction adjusted revenue of £2,583.2m in Q3 2022, which is up from £2,548.5m last quarter.
Lutz Schüler, CEO of Virgin Media O2, said:
“This quarter has seen an increasingly challenging macroeconomic backdrop against which we continue to provide high speed and quality services whilst supporting our customers and people through these challenging times. Additionally, we accelerated our growth in profitability as our commercial momentum advanced and we continue to make strong progress on our three growth waves of expanding and upgrading our network, realisation of synergies and digitalising our business. Our converged offering combined with our improved understanding of our customer, through digitalisation, is underpinning our development and customer-value proposition.
“The third quarter has been one of strong strategic and operational progress supporting our delivery for the rest of the year and beyond. We have grown our mobile and fixed customer base, improved our product offering, hit a major convergence milestone and achieved another quarter of EBITDA growth. We reaffirm our 2022 guidance.”
Sadly, we weren’t surprised to find a lack of updates on their Project Mustang progress, which is currently working to upgrade the 14.3 million UK premises covered by their old HFC infrastructure to the latest 10Gbps capable XGS-PON full fibre (FTTP) technology (here and here) – at a cost of c.£100 per home. We’re seeing a lot of work occurring on this, but VMO2 intend to launch it alongside new products, and thus they’ll want to ensure a reasonable degree of coverage before announcing anything (i.e. we expect to hear more on this in 2023).
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On top of that, VMO2 only provided a small update on their plan to rollout FTTP to an additional 7 million UK premises – under a new entity – to new greenfield areas by 2027, which will also be offered at wholesale to rival ISPs. The formation of the related fibre joint venture is said to be “still on-track for clearance in the fourth quarter with preparation well underway“. This is a major change, and we’ll hear more about it in 2023.
Virgin Media also has the “option” to separately wholesale out access to their existing network of 16 million premises and we expect them to do that, but they haven’t announced a decision on that yet. Securing support from other ISPs for this is key to its viability, but that requires tricky negotiations (issues over exclusivity etc.) and implementation can be both costly and complex for providers.
We should add that the average speed across the company’s broadband base increased 29% year-on-year to 261Mbps and they’re on-track to deliver 5G services to 50% of the UK population in 2023 (EE and Three UK have already achieved this).
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 X (Twitter), Mastodon, Facebook, BlueSky, Threads.net and Linkedin.
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wait. O2 has 5G in 800 towns/cities? really?
Even where they do add 5G it’s sometimes just 10MHz of band n28(700MHz) added to an existing band 1/3/20 site. Enough to light up the 5G logo and ease the congestion a little, but it won’t win any awards for speed.
Many current 5G devices can’t aggregate band 20 + n28, so even though it’s low frequency 5G, it’s only usable where there’s strong band 1 4G reception. My devices alternate between 4G (20+3+1) and 5G (1+3+20+n28). This will improve over time as 5G modems improve and eventually when they launch stand-alone 5G.
The exact quote from VMO2 is this: “In mobile, we have expanded our reach of 5G services to more than 800 towns and cities as well as our upgrade of 4G capacity in 190,000 postcodes in the third quarter. We are on-track to deliver 5G services to 50 per cent of the UK population in 2023.”
That seems clear enough to me.
5G in 800 towns/cities sound like bullock to me. My town get 0% for 5G – NOTHING!
I’m pretty confident there are more than 800 other towns and cities in the UK that aren’t Telford.
Phil: before you write these have a think. Telford isn’t the centre of the world or the entire world. It’s a fairly average large town with a population in Telford and Wrekin of about 180,000 with above average levels of deprivation across multiple areas and poor health outcomes. Your own area of the borough is in the top 10% most deprived areas in the country. 2/3rds of the borough’s working population are on below average incomes. It’s not in a hub of fibre infrastructure that’d reduce deployment costs heavily. It has no CityFibre core, they only bought a wholesale company there but don’t have their own network. Openreach and Virgin Media only, and both have plans to roll full fibre there.
There are thousands of towns and cities in the UK. It’s not profoundly surprising that one that, on the metrics, is below average, isn’t among the first to receive FTTP / 5G from all networks.
5G is available from Three in some bits of Telford but that’s it for right now. My own *city* is at 3 of 4 networks. One still has zero coverage here.
Three rubbish in Dawley that’s why I switched to ee and I’m getting 450 mbps on ee 4g plus .
VMO2 have just upgraded by connection from M100 to M125. According to a speed test a few minutes ago, I now get 118.16 down, 19.30 up.
Was this prompted by the recent availability of services via CityFibre in my area I wonder?
Probably not. They’ve rolled the increase out nationally (see article elsewhere on this site)
Considering the name ‘lightning’ and the extensive time it has taken, this is a highly contradictory project name which was used by mistake?
Project ‘Shortcut stroll round the block’ – is a much more fitting name.
Also as inexplicable, how VM ‘planners’ only complete one side of a street or housing estate and not the other. This suggests their ‘planners’ do not know how to work their planning software.
If the fibre runs past it needs to go to every single home to recoup the revenue.
Whoever ran this project is clearly not proficient in telecoms.
better still, how they then proceed to cut through all the other operators networks in the street and then say they dug it too shallow…
erm installed at minimum 30cm which means if you see the scar for recent works doing 30cm cuts there will… oh hit something…
You lot won’t need virgin media any more soon as 5G stand-alone and 5G advanced plus coming soon
By the way I am from Telford Dawley and I’m getting 450 mbps on my 5g router and it sitting in the window sil in my flat the mast is line of sight connecting to the big 4g mast by Dawley greenway rounderbout by malinslee
So I’m lucky to be on ee 4g mobile broadband service unlimited sim only stick it in the 5g router wallah that’s my broadband sorted plug and play.
I’m getting 450mpbs on my 5G huawei cpe pro 2 on ee 4G plus in my area so bullux to virgin rip off media
The future is bright on EE 4g plus and 5G by getting a 5G router plug and play router and eventually 6G is coming as well so hopefully virgin media will redundant in the dust by 2030 .
Complete rip off company virgin media and 02 robbing scum
For instance their m500 is £62 a month rip off compared to my data only sim on EE is 34.20 due to having a second line on my EE account 10 percent discount.
Only mugs go with virgin media or 02 .
The area I’m in has no 5G and 4G is 15Mbps at best, even with an external aerial.
I’m paying £62/month for a reliable 1130Mbps from VM.
Calling people ‘mug’ for selecting the best connection in their area is a bit moronic.
5G is a major disappointment as the high frequency radio waves struggle to penetrate objects. I’ll take a wired connection any time as my VM broadband is both fast and rock solid.
Carl not really people got to vote with there wallets when it comes to broadband and virgin media 02 I wouldn’t touch with a bargepole ever again .so for me 4G and 5G broadband is the best way forward for the future .
So they added 3 million premises passed with Project Lightning. End of 2016, VM had 5.74m subscribers. Latest results show 5.78 fixed line customers. So seven years of heavy investment to expand the network, a load of debt added to the balance sheet yet no growth. Obviously OR FTTC & FTTP and altnets are part of that, I can’t help feeling that VM’s appalling customer service is coming home to roost, and serve them right.