Home
 » ISP News, Key Developments » 
Sponsored Links

Broadband ISP Zzoomm Slows UK Full Fibre Build and Warns of Job Cuts UPDATE

Tuesday, Mar 5th, 2024 (4:49 pm) - Score 5,720
Zzoomm-Engineer-Opening-Van

Oxfordshire-based alternative network provider and ISP Zzoomm, which originally aimed to cover 1 million premises with their FTTP broadband network across 85 UK towns by the end of 2025, has today notified ISPreview that “new network construction is stopping” (some existing work will continue) and redundancies are expected.

The operator, which is being fuelled by an equity investment of £100m from Oaktree Capital (here) and a £100m debt facility via an international banking consortium (here), has generally focused their rollout on smaller towns in parts Berkshire, Oxfordshire, Herefordshire, North Yorkshire, Staffordshire, Wiltshire, West Yorkshire and Cheshire.

NOTE: On 21st December 2023 the provider revealed that they had already managed to cover 185,000 premises (RFS) across 25 towns (up from 150k on 30th June 2023) and were home to over 20,000 customers (up from 12k at the end of May 2023).

However, back in May 2023 we noted that Zzoomm were reportedly understood to be laying off up to 300 employees in its construction team (here), which was said by one newspaper to reflect about 50% of their workforce and would inevitably impact their pace of build.

The situation is likely to have been fuelled by some of the same challenges that are hitting many other operators, such as rapidly rising build costs, aggressive competition from rivals (e.g. overbuild) and the difficulties of securing fresh investment during a period of high interest rates etc.

The sad news today is that Zzoomm have seemingly notified of more redundancies and the decision has been made to re-focus away from new fibre build, although they will “selectively continue to build on a local case-by-case basis.” But the latter only seems likely to be focused on their existing network areas (e.g. infill, customer installs and or ensuring all existing build is made ‘Ready for Service’).

Zzoomm’s Statement to ISPreview

“You may have seen that Zzoomm’s new network construction is stopping and as such we are making changes to our organisation, which unfortunately means that some of our colleagues in our network construction and support areas will be leaving.

We will selectively continue to build on a local case-by-case basis and continue to release many more homes where new customers can experience our service.

Zzoomm continue to invest adding new people in the marketing, sales, customer service and field service functions to support the continued rapid growth in happy customers.”

Despite the obvious challenges, Zzoomm remains confident about the future and is pleased with the customer growth they’re seeing (it’s growing by around 1.5% penetration each month). Suffice to say that the operator is choosing to play it safe and focus on growing take-up rather than rapid network expansion, which is likely to continue until such time as they’re able to raise fresh investment, assuming consolidation doesn’t bite first.

The catch is that you can’t slow a build without inevitably cutting some jobs, and this would appear to be the second such batch of redundancies since last year. We have asked Zzoomm if they can clarify how many staff are likely to be affected and will report back when there’s a response.

Customers who take their residential service typically pay from £29.95 per month for an unlimited 150Mbps (symmetric speed) package on a 12-month term with an included router, which goes up to £64.95 if you want their top 2Gbps tier. The ISP is also offering a £100 Amazon gift card to new customers.

UPDATE 5:59pm

Zzoomm has kindly informed us that they’ve now got just over 23,000 customers and a little over 190,000 premises passed (RFS).

Share with Twitter
Share with Linkedin
Share with Facebook
Share with Reddit
Share with Pinterest
Tags: ,
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 .
Search ISP News
Search ISP Listings
Search ISP Reviews
Comments
40 Responses
  1. Avatar photo Big Dave says:

    Another altnet ripe for consolidation. Like BRSK and Fern it has very little overbuild with CityFibre.

    1. Avatar photo - says:

      Certainly, but honestly these are bigger numbers (RFS) than I assumed. 12% takeup at stop build point is not terrible and if they can get themselves to 20-25% (e.g 50K subs) overtime, which is easily achievable if no new competitors then they’ve got a sustainable business even standalone. This is small, but sustainable isp size and nothing wrong with that at all.

    2. Avatar photo Peach says:

      Look at Sandhurst – Openreach, Virgin/Nexfibre, Swish, Trooli an Zzoomm. They must have spent millions digging up the streets when PIA was available

    3. Avatar photo No Name says:

      I think CF will end up with this one.

      I also think CF’s game is build a decent base then sell, probably to Vodafone.

    4. Avatar photo Ad47uk says:

      And you and other Out-of-reach fanboys would love that, you love the idea of having just a couple of networks in the country.
      I don’t get people in this poxy country, I really don’t. A company tries to do better, have a better network than the rubbish that Bloated toad have been giving us for years, and you don’t flipping want it.
      i suppose your shares in these big companies are more important.

    5. Avatar photo Big Dave says:

      @Ad47uk

      The money didn’t pile money into these altnets because they were desperate to bring the UK better internet. They did it because they thought there was a quick buck to made (mostly I imagine by selling them on in quick order). Should we have sympathy if it goes t*** up for them? Not For me. You can see by the recent Cuckoo story and the endless pole confrontations that the customer is at the bottom of their priorities.

    6. Avatar photo XGS says:

      ‘I don’t get people in this poxy country, I really don’t. A company tries to do better, have a better network than the rubbish that Bloated toad have been giving us for years, and you don’t flipping want it.’

      You only went with them because of pricing. You were quite happy with FTTC and had no interest in their better network as FTTC was fine and having FTTP installed was inconvenient. You spent months banging on about how pointless FTTP was at every opportunity.

      Your interest remains pricing. I’m not convinced you’ve any right to lecture others on appreciating a better network, what they should and shouldn’t want, etc, when your main criteria is how cheaply you can renew, whether the pricing is sustainable or not.

      https://forums.thinkbroadband.com/fibre/t/4752383-re-cost-of-going-back-to-fttc-in-future.html

      You haven’t once mentioned network quality or performance as a reason for using altnets, all you have written about is value and pricing.

      If Bloated Toad, Vermin Media or one of the others on your infant school insult list are delivering that who cares about Zzoomm?

  2. Avatar photo double-ender says:

    I would advise anyone in the alt net isp industry to get out asap. There can only be one winner unfortunately

    1. Avatar photo Jeremy says:

      Me? 🙂

    2. Avatar photo DTH says:

      Is the winner Dave the Hat?

    3. Avatar photo NE555 says:

      > I would advise anyone in the alt net isp industry to get out asap

      That’s exactly what they’re all trying to do. Stop burning capital, try to gain some more customers on the already-built network, in the hope that someone might want to buy them out.

      If Zzoomm has 23K customers @ £30 per month, that’s £8.3m p.a. gross sales, from which have to be taken the costs of running the network, customer service, sales, billing etc, and whatever’s left is supposed to repay capital outlay of £200m ?! Not a great proposition at the moment.

    4. Avatar photo FibreBubble says:

      @555 You are forgetting to take
      20% off your top line for vat

    5. Avatar photo Bob says:

      The public accounts show them making a loss and are dependent on funding from parent company in order to continue to trade

      They face the challenge nearly all the Altnets have of high infrastructure costs, High levels of debt and slow take up and increasing competition for customers

  3. Avatar photo DTH says:

    Ha ha ha
    @Jeremy! No! Just Dave The Hat!

  4. Avatar photo Dagnis says:

    Another money laundering investment into a new altnet which wont last..

    1. Avatar photo Peter says:

      clearly someone that works for BT hah

  5. Avatar photo Dave says:

    Zzoom added loads of customers with cheap deals 500mb for £25 but now they have hiked their prices new customers taking it up will slow.

    1. Avatar photo Ad47uk says:

      They have not hiked their prices, they just put them back up to normal prices. Their prices are no more expensive than others, the only reason larger providers are cheaper is that they keep giving offers to people to keep them.

      I hope Zzoomm keeps going, I certainly don’t want to go back to Out of reach if I can help it.

    2. Avatar photo Fender says:

      Surely, your adolescent wit means that you should now be referring to Zzoomm as Ddoommed?

    3. Avatar photo XGS says:

      Oh my.

      ‘Their prices are no more expensive than others, the only reason larger providers are cheaper is that they keep giving offers to people to keep them.’

      https://forums.thinkbroadband.com/fibre/t/4752383-re-cost-of-going-back-to-fttc-in-future.html

      The thread is titled ‘cost of going back to FTTC in future’ and the guy who wrote the above about larger provider offers to keep customers wrote:

      ‘I may be in the same situation in July, depending on what Zzoomm can do for me’

      I mean say whatever you like just don’t expect not to be pulled up for moaning about the attitudes of others on here while being a raging hypocrite.

  6. Avatar photo Ivor says:

    i’m sure the regular commenter who loves to talk about how great zzzoooooommmm are compared to BT will be delighted to hear the news.

    It is certainly going to be interesting to see how the alt net sector develops – it turns out that severely undercutting the big boys (even if it is symmetric!!!!) is not working

    1. Avatar photo Big Dave says:

      Yes, where is anonymous when you need (insert whichever pronoun is preferred)?

    2. Avatar photo No Name says:

      It’s not undercutting, it’s over build and construction costs mainly. The latter which has been stung by inflation.

      I doubt any Altnet is pricing at a loss. As I keep saying, there are so many Alt Nets overbuilding eaachother in towns with 20 – 30k properties. That isn’t viable. In areas with 80k+ where 4 providers can have at least 20k each its fine. Not small towns unless you only need a take up rate of 10%.

    3. Avatar photo Ivor says:

      Even the 90s cable companies couldn’t make it work, and they had everything rigged in their favour – BT couldn’t provide TV services and was discouraged from rolling out its new fibre network, and there was no such thing as LLU back then either.

      The altnets have to deal with Openreach being allowed to fully compete, and now a resurgent Virgin Media attempting to join the wholesale market. Both companies have (or will eventually have) a network that uses identical technology and can provide all the same services as any altnet.

      Don’t see how the size of the town matters. If you’re all digging up the same streets then you’re all competing for the same customers, whether it’s a village or central London.

    4. Avatar photo NE555 says:

      > The altnets have to deal with Openreach being allowed to fully compete

      Actually not true: Openreach have regulated pricing from OFCOM, at least for the base 40/10 FTTP product, which means they’re not allowed to cut prices to compete with the altnets.

      For many altnets, their business model has been based *entirely* on undercutting Openreach at wholesale, by cherry-picking the cheapest to build areas (e.g. Cityfibre), and/or building before OR get there.

      For a few, it has been to deploy in more difficult areas where the existing copper service is poor and people are prepared to pay a premium for fibre (e.g. Gigaclear).

      In the long term though, OFCOM is not going to be able to justify keeping FTTP pricing from Openreach artificially high.

    5. Avatar photo Big Dave says:

      The stupid thing was allowing altnets to overbuild each other in the first place. It was always going to be a tough nut to crack with 2 established players to compete aginst. The problem is if you have 4 players or more it may work if the pie is divided equally but it’s unlikely to happen like that. Customers will always gravitate towards established names and the others will just be dining on the scraps. Free market competition in this area may sound good in theory but in reality it needed to be single national brand with a recognised name.

    6. Avatar photo Ivor says:

      the pricing is regulated, but Ofcom is clearly willing to work with Openreach as needed – eg Equinox and other regulatory changes for OR’s business case to make sense, much to Greg Mesch’s annoyance.

      This is perhaps borne out by certain ISPs, notably Sky, remaining OR exclusive and not chasing every altnet going.

      That is different to previous rounds where BT was firmly knobbled to ensure the “competition” can “compete”.

    7. Avatar photo Big Dave says:

      I have friends who have chosen to stay on BT FTTC (SOGEA in 1 case) even though altnets have passed their houses because they want to stay with BT and they are satisfied with what they have got (although they will upgrade if Openreach passes them). Shows how just a tough nut this is to crack for the altnets.

    8. Avatar photo anonymous says:

      “Yes, where is anonymous when you need (insert whichever pronoun is preferred)?”

      Fret ye not, I’m here. And here’s my thoughts on the matter:

      Zzzzoooooooooommmm..zzm..zzzmmm…POOOOMMMFFFFFF!

  7. Avatar photo Anon75678 says:

    Sadness…

    1. Avatar photo Bob says:

      The future for most Altnets cannot be great, Cable TV consolidated. You need a high level of take up to suceed and most will not achieve that. The Royal Mail has the same problem far fewer people have letters delivered so the economics no longer work

  8. Avatar photo finaldest says:

    Another one bites the dust
    Another one bites the dust
    And another one gone, and another one gone
    Another one bites the dust
    Hey, I’m gonna get you too
    Another one bites the dust

    1. Avatar photo Big Dave says:

      That’s going to be playing in my head all afternoon now……LOL

  9. Avatar photo I love Starlink says:

    For gods sake! I’ve just driven past Zzoomm building about a mile and a half from my house – Looks like the same as CF they are going to stop!

    1. Avatar photo XGS says:

      They never had any intention of going into the town itself. Have a look at their coverage maps. Smaller market towns and suburban villages are their thing, not overbuilding existing Openreach, VMO2 and CityFibre.

  10. Avatar photo Walkerx says:

    They’ve recently laid cable in our area over the past few months and hoping to go live sometime this month.

    Wonder if that will still go ahead and whether or not it would be worth migrating to them.

    1. Avatar photo Big Dave says:

      The only thing with large scale consolidation likely to be around the corner the company you sign up with now may not be the one you end up with. I’m signed up with BT til Nov ’25 and I’m hoping by then this thing will have shaken itself out and then can look at the options then.

  11. Avatar photo Anon75678 says:

    This is such depressing news for my town.

    It will probably be another year now, before we get FTTP rolled out in my street.

  12. Avatar photo Bash says:

    I just found/searched this page because a CityFibre crew were doing some work outside my house here in Henley. I couldn’t work out if they were contracting to Zzoomm (as they had some pink fibre truning onboard) or BT but given they were in the BT inspection holes – so maybe the latter…

    They’ve been pretty good since I went with them in March 2021 – compared to BT (customer service was appalling) who I kicked out for Vodafone (customer service was good) its a no-brainer. I’m surprised they’ve still only got 1 in 3 takeup here but some people were moaning about them digging the road up, and their ugly pink vans and almost like they weren’t signing up out of spite so I wonder if they have a similar problem in other small towns (Fibre NIMBY-ism seems to be a thing!!) – I’m happy to refer if anyone wants them as it would be pain if they went under.

  13. Avatar photo Tom cruise says:

    Zzoomm now say they don’t have server capacity for all new connections. 1gb now running at about 40meg at peak times. New servers on order….!

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

NOTE: Your comment may not appear instantly (it may take several hours) due to static caching or random moderation checks by the anti-spam system.
Javascript must be enabled to post (most browsers do this automatically)

Privacy Notice: Please note that news comments are anonymous, which means that we do NOT require you to enter any real personal details to post a message. By clicking to submit a post you agree to storing your comment content, display name, IP, email and / or website details in our database, for as long as the post remains live.

Only the submitted name and comment will be displayed in public, while the rest will be kept private (we will never share this outside of ISPreview, regardless of whether the data is real or fake). This comment system uses submitted IP, email and website address data to spot abuse and spammers. All data is transferred via an encrypted (https secure) session.

NOTE 1: Sometimes your comment might not appear immediately due to site cache (this is cleared every few hours) or it may be caught by automated moderation / anti-spam.

NOTE 2: Comments that break our rules, spam, troll or post via known fake IP/proxy servers may be blocked or removed.
Cheap BIG ISPs for 100Mbps+
Community Fibre UK ISP Logo
150Mbps
Gift: None
Virgin Media UK ISP Logo
Virgin Media £26.00
132Mbps
Gift: None
Shell Energy UK ISP Logo
Shell Energy £26.99
109Mbps
Gift: None
Plusnet UK ISP Logo
Plusnet £27.99
145Mbps
Gift: None
Zen Internet UK ISP Logo
Zen Internet £28.00 - 35.00
100Mbps
Gift: None
Large Availability | View All
Cheapest ISPs for 100Mbps+
Gigaclear UK ISP Logo
Gigaclear £17.00
200Mbps
Gift: None
YouFibre UK ISP Logo
YouFibre £19.99
150Mbps
Gift: None
Community Fibre UK ISP Logo
150Mbps
Gift: None
BeFibre UK ISP Logo
BeFibre £21.00
150Mbps
Gift: £25 Love2Shop Card
Hey! Broadband UK ISP Logo
150Mbps
Gift: None
Large Availability | View All
The Top 15 Category Tags
  1. FTTP (5505)
  2. BT (3513)
  3. Politics (2534)
  4. Openreach (2296)
  5. Business (2258)
  6. Building Digital UK (2243)
  7. FTTC (2042)
  8. Mobile Broadband (1969)
  9. Statistics (1786)
  10. 4G (1661)
  11. Virgin Media (1615)
  12. Ofcom Regulation (1457)
  13. Fibre Optic (1393)
  14. Wireless Internet (1388)
  15. FTTH (1381)

Helpful ISP Guides and Tips

Promotion
Sponsored

Copyright © 1999 to Present - ISPreview.co.uk - All Rights Reserved - Terms , Privacy and Cookie Policy , Links , Website Rules , Contact
Mastodon