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BT Group Add 950k Premises to FTTP Broadband Cover in Q4 2023

Thursday, Feb 1st, 2024 (7:40 am) - Score 4,440
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Broadband and telecoms giant BT Group has today posted a short trading update for the last quarter to December 2023, which reveals that Openreach expanded the UK coverage of their Fibre-to-the-Premises (FTTP) based broadband ISP network by another 950,000 premises (up from 860k last quarter) to total 13 million passed.

Take note that the BT Group now only publishes a short trading update in calendar Q1 and Q3 (roughly in-line with most FTSE 100 companies), thus we only get a very limited summary this time around and the full details come in Q2 and Q4. As such, we’ve opted to do a similarly brief update on the key details below.

NOTE: BT are investing up to £15bn to bring FTTP to 25 million premises by December 2026 (80%+ of the UK) and they aspire to potentially reach up to 30 million by 2030 (c. 25-30m).

In terms of the headline changes. Openreach expanded their FTTP coverage by 950,000 premises in the last quarter of 2023, which is in keeping with their targets (here) and gives them a build rate of 73,000 premises passed per week. The operator also added 432,000 full fibre customers in the same period, which pushes their take-up rate to 34% or a total of 4.4 million (achieving this during a high rate of build is particularly impressive).

In addition, it’s worth contrasting these results against BT’s current targets, which among other things have predicted that their total labour force would shrink to between 75,000 and 90,000 by 2030 (e.g. many of the engineers they have today won’t be needed post-2030) and FTTP coverage would grow to between 25-30 million premises, while delivering take-up of around 40-55% by this same date.

BT also holds a target of 13.0-14.5 million retail 5G mobile connections via EE for 2030.

BT’s New CEO, Allison Kirkby, said:

“BT Group has delivered another quarter of revenue and EBITDA growth, while rapidly building and upgrading customers to our full-fibre broadband and 5G networks, and we continue to be on track to achieve our financial outlook for the year.

We are providing great digital connectivity and services, while laying the foundations for future growth that will benefit our customers, investors and the UK. As I assume the role of Chief Executive, we remain committed to our purpose and our strategic focus, and I am looking forward to leading BT Group into its next phase of development.”

BT Group’s Q3 FY24 Performance Summary

  • FTTP build rate accelerated to 73k per week delivering a record of 950k premises passed in the quarter. FTTP footprint is now expanded to 13m premises with a further 6m where initial build is underway
  • Strong Openreach customer demand for FTTP with net adds of 432k in Q3. Total premises connected now  4.4m with increased take-up of 34%
  • Openreach broadband ARPU grew by 10% year-on-year due to price rises and increased volumes of FTTP; Openreach broadband lines losses of 369k year to date, a 2% decline in the broadband base; ongoing weak broadband market conditions mean losses will exceed 400k in FY24
  • Consumer broadband ARPU  increased 5% year-on-year and Consumer postpaid mobile ARPU increased 8% year-on-year; monthly churn for the quarter remained stable in a competitive market with broadband and postpaid mobile at 1.1% and 1.2% respectively
  • Business financial performance  continues to be impacted by higher input costs, legacy declines and prior year one-offs, partly offset by cost transformation and growth in Small & Medium Business (SMB) and Security
  • Retail FTTP base grew year-on-year by 46% to 2.4m of which Consumer 2.3m and Business 0.1m; 5G base 10.3m, up 30% year-on-year. RootMetrics named EE the UK’s best mobile network for the 21st time running
  • BT Group NPS of 25.7, up 3.6pts year-on-year, further improving customer experience

Pro forma revenue and EBITDA growth year to date:

  • Pro forma adjusted1 revenue £15.8bn, up 3% on Q3 FY23 due to price increases and fibre-enabled product sales in Openreach, increased service revenue1 in Consumer with 2023 annual contractual price rises being aided by higher roaming and increased FTTP connections, and SMB trading momentum and price rises in  Business, offset partially by legacy product declines; reported revenue was up 1%
  • Pro forma adjusted1 EBITDA £6.1bn, up 3% with revenue flow through and cost control more than offsetting cost inflation and one-off items in the prior year
  • Reported profit before tax of £1,498m, up 15%
  • Reconfirming all FY24 financial outlook metrics
 

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Mark-Jackson
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 X (Twitter), Mastodon, Facebook and .
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Comments
40 Responses
  1. Avatar photo RightSaidFred says:

    Premises footprint 13m

    Premises connected 4.4m

    Retail base 2.4m

    Something doesn’t add up here. Are they saying of the 4.4m premises connected, 2m no longer have an active line?

    1. Avatar photo Phil says:

      I think it’s because they’re other ISP’s like Sky and TalkTalk who use Openreach.

    2. Mark-Jackson Mark Jackson says:

      As Phil hints, you’re confusing the figures for BT the retail ISP with the Openreach the wholesale provider to multiple ISPs.

    3. Avatar photo RightSaidFred says:

      Yeah, makes sense.

      Too early in the morning to think properly.

    4. Avatar photo K says:

      Thats what coffee is for.

  2. Avatar photo Mwood says:

    Does that take-up rate purely reflect retail customers or include wholesale from other ISPS?

    1. Avatar photo Matt says:

      1/3 of the FTTP footprint has a customer on it (excellent considering their build rate)

      13m total premises covered, 4m is how many customers are on FTTP, 2.4m is how many are with BT (BT,EE,Plusnet) – the other 2m are on “Other” providers (Sky etc.)

      So not only a good build rate, but has a good uptake, and BT have *more than half* of the customers on the OR network – which is superb considering the pricing structure of BT/EE to be “Premium” products.

  3. Avatar photo Interested Person says:

    The scale of this rollout and the take up figures are staggering, especially when compared to some recent AltNet announcements. Govt should take note about the value of Wholesale competition.

    1. Avatar photo Big Dave says:

      That’s the problem (as I recently commented in another in another story). If the altnets pause their builds and Openreach carry on apace then should an altnet go back and restart then they may well find that Openreach have been in the meantime and grabbed a decent customer base then it becomes even harder than it was before.

  4. Avatar photo No Name says:

    Openreach are becoming a company that loves to talk about work, but not actually do any.
    Focus on getting those areas that were announced 4+ years ago on to FTTP, instead of just talking about how good the FTTP rollout is.

    1. Avatar photo Fastman says:

      those area

      think your missing the point no provider will do all of the areas most will only do a percentage which is one of the challenges which is increasingly more and more crystalised — it what i terms whole mints to polo scenario — the bit you get left with (Polo) is way hard to build / cost than if you done the whole are in the first place (wholemint)

    2. Avatar photo Alex says:

      BT Group is a publicly listed company, so they have to report quarterly.

      Get over yourself.

    3. Avatar photo No Name says:

      “Get over yourself.”

      Thank you alex, very insightful.

      It is perfectly acceptable to criticise OR though, because they still haven’t delivered anything around here. They just keep talking about how good things are and announcing more and more areas.

      Locally there simply has not been any movement so its still a fair comment.

    4. Avatar photo Alex says:

      Sorry if I offended, but, like a fair few people in these comments, you criticise Openreach simply because you’re not one of the 13m homes they’ve reached so far – which is just a bit myopic and parochial. I wouldn’t expect you to celebrate their huge progress and engineering achievement, but you might extend you’re frustration a little wider, to perhaps include the many other networks that haven’t reached you yet either.

    5. Avatar photo Big Dave says:

      The Unfortunate reality is that if they are going to be building to 2030 then someone is not going to be connected until 31st December 2030. It’s a hard pill to swallow for that person but it has to be somebody.

    6. Avatar photo No Name says:

      Ofc, but you would expect that to be the people announced in 2026 not the ones announced in 2020 with “work to get underway in 12 – 18 months”. This isn’t a small area either, about 80,000. So even if they start tomorrow (doubtful) it’ll be years until its all done.

    7. Avatar photo Fastman says:

      no name — because they still haven’t delivered anything around here. They just keep talking about how good things are and announcing more and more areas. – where is here as that will tell when they have delivered part of your exchange area or none — wholemint or polo

    8. Avatar photo No name says:

      Stretton. So the exchange is Burton on Trent.

      Nothing apart from new builds.

  5. Avatar photo ISP User says:

    Does this not imply that BT retail is getting better at force migrating (byway of pricing, customer journey and marketing the benefits) onto FTTP which gives then the leg up? Has anyone had this experience? Not that this is wrong but just that these take-up figures are supported by the fact BT have 34% of the market which is by coincidence in line with the current OR % penetration which will go up over time.

    To me this suggests they have got better at migrating their own customer base to FTTP while losing in overall BB lines.

    Not bad news for BT but a good chance people misinterprets this.

    1. Avatar photo K says:

      Once your area has 75% coverage of OR FTTP it becomes a full fibre only area. This means you cant change ISP without upgrading to FTTP.

    2. Avatar photo XGS says:

      BT’s retail operations are clearly pursuing FTTP more aggressively.

      They and Sky use Openreach only however Sky have their unbundled kit in exchanges so potentially have a vested interest in keeping punters on copper a while longer.

      TalkTalk have a big LLU base and their customers are less likely to upgrade. They, Vodafone and others use CityFibre and other networks.

      I imagine Ofcom are looking at their FTTP market share and so far see nothing untoward. BT had a disproportionate share of FTTC for a while as the LLU operators wanted to sweat their MSANs/DSLAMs some more so weren’t marketing it as aggressively.

    3. Avatar photo Big Dave says:

      Yes, BT are pushing customers towards FTTP when recontracting. A friend of mine lives in an area which has not yet got Openreach FTTP but has recently dropped his landline and gone to SOGEA with the proviso that if Openreach do go down his street he will automatically be upgraded to FTTP.

  6. Avatar photo Difficult Area Dweller says:

    Unless FTTP isn’t available as you are in a difficult (expensive) area to install to.

  7. Avatar photo FibreBubble says:

    When BT put their mind to doing something, they can use their scale to do it rapidly. Openreach FTTP is reaching peak build rate just at a time that many alnets, or their backers, are getting cold feet.

    1. Avatar photo Big Dave says:

      Now Ex BT CEO Philip Janssen got a rollocking from Ofcom for predicting it would all end in tears for the altnets. Unfortunately he may well be proved right.

    2. Avatar photo Alex A says:

      I don’t think the backlash “it’ll all end in tears” got was just. It was obvious that even 3 networks was pushing the business case and required the smallest network to try hard to get customers again Openreach and VMO2/nexfibre.

      Altnets talk about reducing overbuild but the industry is like a birthday cake. Openreach (the birthday haver) is almost guaranteed a good slice, everyone else agrees that a tiny slice each is pointless, but none of them want to be the ones who forgo it entirely to allow everyone else to have a decent slice.

      What was needed was a what the French have, in which several hundred premises are run P2P to a cabinet where each company’s splitters are. Changing ISP is repatching in the cabinet to a different splitter. The fibre links to the premises and from the cabinet to the exchange are price controlled and operators are allowed to do whatever on the fibre.

      It would allow each operator to have very close to its own network but prices would be far lower as its 100% take up on the physical network.

      Supposidly Swisscom’s P2P network to exchanges was only 10% more expensive than Openreach style though I don’t know how frequent Swisscom exchanges are.

      I suspect Ofcom’s criticism of the tears comment was because its critical of their proposed operation of competition on the physical level.

    3. Avatar photo Anonymous says:

      Be gone with your common sense. We all want 36728 ONUs lined up on our walls and a Jenga tower of CBTs outside.

    4. Avatar photo Big Dave says:

      “What was needed was a what the French have, in which several hundred premises are run P2P to a cabinet where each company’s splitters are. Changing ISP is repatching in the cabinet to a different splitter. The fibre links to the premises and from the cabinet to the exchange are price controlled and operators are allowed to do whatever on the fibre.”

      Clearly this was the way to go. Running multiple cables to do the same job is just an expensive waste of resources. One thing certain is that even if the altnet business becomes any kind of success it won’t happen without someone losing their shirt along the way.

    5. Avatar photo Alex A says:

      @Anonymous I honestly don’t understand how Ofcom seriously thought of a future where we have 3 ONTs in our house. Madness.

      @Big Dave It’s more wasteful than that as OLTs are inefficiently used. Openreach operate GPON on about ~30 customers per PON to leave a couple ports spare. Altnets might have 64 per XGS PON (4x the capacity) but only 20% takeup means only 13 customers per PON, very wasteful.

      The patching idea I mentioned above allows operators to fill up PONs before moving onto the next and deploy a few when the capacity is needed.

      Already seeing the altnets failing, Upp had 175 000 covered but only 4000 customers when it was acquired, 2.3% takeup… CommunityFibre is supposedly about 30% takeup and that’s considered incredible. Meanwhile, VM are typically about that and have never been amazingly profitable.

    6. Avatar photo anonymous says:

      FibreBubble – Just a shame its the usual legacy BT rubbish put out (GPON instead of XGS-PON) and crippled upstream (non symmetric)…

    7. Avatar photo GreenLantern22 says:

      I disagree. While the single connection to each property idea is not the best solution. It provides a single point of failure and no room for innovation as all networks are tied to the same standard. Right now I have internet connectivity in my house by two separate networks (Community Fibre and VM) which are completely independent of each other and extremely unlikely to fail at the same time. And I have a third option as well (Openreach). These 3 networks will need to compete for my custom and they will able to innovate uinto different directions if they so want to do so.

    8. Avatar photo Just a thought says:

      @Big Dave that would appear to be a good option. Are they passive? Could they take up just a large box at the site of the exchanges that are being freed?

      The other option might be to say any FTTP optics must come up to a standard and must be open to wholesale. That way one physical connection to house and multiple suppliers. Fewer spiders from poles outside properties.

      There are several regional electricity supply companies but a plethora of billing/generation ethos companies.
      That said @GreenLantern22 are all your Pants and devices battery backed? If not power supply to the property must also be a single point of failure.

    9. Avatar photo Big Dave says:

      @GreenLantern22

      Unless you lived in a Virgin Media area most people have had a single point of failure – the Openreach copper line so it’s really no different to what we’ve always had. In fact I would expect the fibre optic line to have a much lower failure rate than the copper.

    10. Avatar photo Alex A says:

      @GreenLantern22 Its a single point of failure when each operator has its own physical layer if you only have 1 connection. Only 1 connection will be less prone to failure as fewer people are interacting with BT ducts, it’s not that uncommon that PIA operators end up damaging the infrastructure of BT or other PIA operators.

      Networks are free to innovate, the patching system still gives them their own fibre cable which they are free to do whatever they would like with, it behaves no differently to them building their own fibre. It is the fibre equivalent of Sub Loop Unbundling.

      In France SFR, Bouygues Telecom, Orange and Free all behave like UK altnets (and VM) with their own terminating equipment and slightly different deployments (EPON vs GPON vs XGS PON) but they share the final local loop.

      Obviously, full LLU with fibre run to buildings would be preferable but putting splitters (and using GPON/XGS PON/RFOG/WDM+P2P) reduces the number of fibres to be run to the exchange without compromising flexibility too much. Operators are free to use P2P but they would have to pay extra to have a backhaul cable for each connection as opposed to splitting it between 32,64, etc. customers.

      @Just a thought the cabinets are passive (Google ‘Fibre PMZ’ if you are looking for the ones in France). You can get ~800 lines into a cabinet the size of the large Huawei FTTC cabs. Clearfield also make a few patching cabinets. They aren’t a replacement for local exchanges but a higher density PCP. You’d still have fewer exchanges as fibre equipment takes up less space and can go for further distances.

  8. Avatar photo Bob says:

    A 34% take up must be putting a squeeze on the Alt Nets. The underlying take up will be presumably be even higher as the new builds will not get to 34% straight off

    1. Avatar photo Big Dave says:

      The altnets can do alright where they get in first and have no competition. Community Fibre in London seem to do OK because I suspect in many places they’re the only show in town. From what I’ve read on these pages City Fibre seem to be doing OK in Milton Keynes where they were probably first in the street (mind you given the overall take up is 10.5% there must be places where it’s abysmal).

  9. Avatar photo Nick Roberts says:

    Seems to me as if the competitive environment for landline broadband was set-up from the outset to ensure that BT came out on top. They had inherited all the assets from the state predecessor and had a massive initial market capitalisation which the other interested parties couldn’t compete with unless they clubbed together.

    Government missed the essential trick by licensing the fibre installation at sub-regional level and allowing any bloke and his (Under-capitised) dog to become a fibre installer. Hence the financial difficulties, take-overs and low market share that we see amongst the others now. The present situation was guarenteed from the outset.

    If government had required that the unit of bid had been regional it would have ensured that those participating came to the game adequately capitalised and the end-game would have seen BT face real competition.
    That said, most of tbe otbers participating in fibre installation, knew what the outcome would be wben they joined the game under the current spefication, so were and are happy to “Take the money and run” knowing that the process selected had put the sword to effective competition to providers from outside the UK, so that an enduring income stream was guarenteed almost risk-free.

    1. Avatar photo Alex A says:

      BT have an advantage but LLU really shook up the market. Ofcom’s failure was allowing BT’s deployment, by combining the physical and terminating layer it restricts operators to the tiers BT offers and prevents fibre from being used for something else, like RFOG.

      TalkTalk put it well in their letter to Ofcom, BT to get to charge for the tiers, they charge for the cablelinks onto their network, they charge for the ONTs (and originally VDSL modems, it took years for cable only VDSL to be an option). TalkTalk could run ONTs themselves for far cheaper but they have to use BTs.

  10. Avatar photo James says:

    @Big Dave – it would appear Community Fibre are either short of installers or sending out the ‘we’re in your area’ stuff very prematurely.

    SW London here and I’ve see CF guys run street fibre further down my road back in 2022, but no update in 3 months of the flyer landing last Sept, and today the postcode checker suddenly shows; NO plans to build in your area!

    If I wanted an asymmetric connection I’d stay on Adsl, but I want proper symmetric FTTP not the fake ultra-mega-super-fast fibre OR are hawking. Doesn’t look like I’ll get a choice anytime soon…

Comments are closed

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