Home
 » Interviews, ISP News » 
Sponsored Links

Netomnia and YouFibre CEO on Pushing the Boundaries of UK Broadband

Tuesday, Apr 2nd, 2024 (12:01 am) - Score 5,680
Jeremy-Chelot-of-Netomnia-and-YouFibre

Computer scientist and CEO of full fibre network builder Netomnia (inc. sibling ISP YouFibre), Jeremy Chelot, has today talked to ISPreview about why he’s pushing the boundaries of UK broadband performance, while also touching on the topics of market consolidation, wholesale and the possibility of launching a mobile service.

Netomnia currently (Feb 2024) covers over 850,000 premises (up from 730k in Nov 2023), in parts of over 70 towns across England, Wales, Scotland and Northern Ireland, with their 10Gbps capable Fibre-to-the-Premises (FTTP / XGS-PON) broadband network. The operator’s immediate ambition is to reach 1 million premises during “early 2024” (coverage plan – plus additions here, here and here), but they may go beyond that.

NOTE: Supported by Advencap, DigitalBridge and Soho Square – Netomnia and YouFibre have now raised £795.5m in just three years.

The operator, like a few other alternative networks in this market, tends to adopt a Physical Infrastructure Access (PIA) centric build model, which means they can keep their build costs low and rollout quite rapidly by running new fibre via Openreach’s existing cable ducts and poles. Not to mention harnessing rack space inside BT’s existing exchanges, rather than building their own Fibre Exchanges (FEX).

Advertisement

Netomnia is also somewhat vertically integrated by virtue of operating their own ISP via the increasingly popular YouFibre brand, which last year became one of only a handful of retail providers to launch an 8Gbps capable broadband package for residential consumers (here) and they’re looking to go even faster (here). As of February 2024, the provider is home to 80,000 customers (up from 65k on 13th Dec 2023)

Overall, progress has been good and the seeds of that growth can be largely attributed to the company’s boss, Jeremy Chelot, who was previously the CEO of another fairly successful AltNet, London-focused operator CommunityFibre. Prior to that he was also the IP Core Network Solutions Manager/IP Architect for Three UK (H3G) and has now been in the fibre industry for the last 10 years.

Naturally, we wanted to know more about what drove Jeremy to start the new company, its progress, future plans and why he’s so keen to push broadband performance well beyond what many other operators are currently doing.

The Netomnia Interview

1. Firstly, can you share with us a quick general update on the progress of your network coverage (e.g. premises passed, total customers, take-up levels and areas of deployment), your future targets and how much total investment Netomnia has so far managed to attract?

Advertisement

Jeremy said:

Since October 2020, Netomnia and YouFibre have raised £345m in equity from Advencap, Soho Square Capital, and Digital Bridge, and, £450.5m in debt from Avenue Capital and a group of nine banks (Alpha Bank, Barclays, HSBC, ING, NIBC, Nord/LB, RBC, Standard Charter, and UKIB).

As of the end of February 2024, we have 850,000 premises on the Netomnia network ready for service (RFS), and 80,000 YouFibre customers.

We expect to reach our target of 1 million premises passed by Q2 this year. Our new target will be to achieve 2 million premises passed by the end of 2025.

2. As most people reading this will probably know, before starting Netomnia and YouFibre you were actually the CEO of another fairly well-known AltNet in London, CommunityFibre. I’m curious to know what made you want to start your current business after having done something similar before and, perhaps more importantly, what learnings you carried over from your previous role to help grow the new business?

Jeremy said:

I enjoyed my time as CEO at Community Fibre but I always knew I wanted to build a national fibre network across the UK and was convinced that I could replicate what I had done at Community Fibre on a national scale.

When I was young, I had access to a 512kbps cable connection when all my friends were still on a 56kbps modem. Having access to faster speeds meant I could learn faster than anyone else I knew at my age and without this, I wouldn’t be where I am today.

With Netomnia and YouFibre, I wanted to create a network infrastructure and an Internet Service Provider that could deliver a faster, better, cheaper Internet connection to as many people as possible, to give everyone the same access and opportunities.

3. Naturally, we can’t talk about the current market without also considering the seemingly growing likelihood that a fair number of alternative networks, under pressure from rising costs, competition and the need to generate good take-up by consumers, may shortly find themselves being either consolidated or becoming consolidators in their own right.

We sometimes fear that all this talk of consolidation may overlook the challenges of actually merging two networks together, particularly as different operators can have different approaches to build (e.g. Netomnia’s low cost / PIA approach vs a greater proportion of trench building). Not to mention any differences in technology and network design, which will later need to be aligned, adding costs.

However, Netomnia seems to be bucking some of the industry’s more negative trends, and currently shows no signs of slowing down. What makes your approach different, and do you anticipate being a consolidator yourself in the future (as opposed to being consolidated)?

Advertisement

Jeremy said:

Netomnia’s approach is different because we are one of the most capital-efficient altnets in the UK.

I believe altnets have proven they can build at scale and together will achieve more than 10 million premises RFS by the end of this year. I also believe that altnets have proven that they can achieve a high level of take-up with most companies having delivered more than 30 per cent take-up in mature developments. For example, YouFibre has 33 per cent take-up in its oldest cohort (2020).

Where altnets differ significantly is the capital they spend to get premises RFS and to acquire customers. By the end of February 2024, Netomnia and YouFibre have only consumed £170m of debt. That works out to £200 of debt for each premises RFS – the larger altnets in the UK have consumed up to five times more debt than us for each premises they make RFS. And it’s the same story with equity.

Because of our key difference (capital efficiency), it makes consolidation in the UK very hard. We are so capital efficient that almost every deal will cost us more than organic growth and we have an addressable market in front of us of several millions. Therefore, while we would love to be a consolidator, it makes it difficult. We have not built the business to be consolidated. We focus on delivering for our customers and becoming the third network in the United Kingdom and that’s what drives me!

4. Quite a few of the other AltNets that I’ve spoken with often tell me that they see going wholesale as the best way to help grow take-up longer-term, particularly if they can attract bigger ISPs, much as CityFibre has done (i.e. getting big brand names on board can make a world of difference, but it’s not easy).

However, Netomnia currently remains more vertically integrated, given that you primarily still sell consumer broadband packages via YouFibre, which is also run by yourself. On the flip side, as an operator, you’ve often described your network as being open to wholesale, so I’m just wondering where you are with that approach today and how you see that side of the business (excluding YouFibre) progressing?

Jeremy said:

We are keen on wholesale. I don’t believe that we will get BT or Virgin Media (but happy to get a call from them) and Sky is only working with Openreach so far – so TalkTalk and Vodafone are our main options for scaled ISPs but, as we know, both companies are quite busy at the moment with a merger (3 and Vodafone) and a restructure (TalkTalk split into three companies).

I am convinced that the future is bright because it makes sense for us to work together and let’s be fair, 12 months ago Netomnia only had 350,000 premises RFS, and now we have 850,000 and soon 1 million, therefore, we are only just becoming interesting. We will win together but our business plans have been built with YouFibre only so if it happens great, if it does not, not a big deal.

5. YouFibre and Netomnia made a few headlines last year by becoming one of only a tiny number of providers to launch an 8-10Gbps class product. By comparison, the CEO of your former haunt at CommunityFibre, Graeme Oxby, said they could do the same but have chosen to stick with a 3Gbps maximum because he felt that consumers would struggle to harness more than that in the real-world.

Not to mention the difficulties that such speeds can cause for customer support departments and speed testing (i.e. very few devices and online services are capable of even remotely close to such speeds). Is it all a game of bragging rights for marketing purposes, or is there more to this strategy?

Jeremy said:

There is more to it. Since I started rolling out fibre and providing Internet connectivity, I promised myself that I would always push the limits and drive others to do the same. We have hundreds of 8,000 Mbps customers and I am looking forward to 50G-PON. The reason the UK was behind with its full fibre availability is because operators were satisfied with FTTC (DOCSIS or VDSL) whereas they should have pushed the limit sooner…I will push them.

6. Naturally, one risk with an 8Gbps product is that it might only take a few people to join, in the same area, to stress local network capacity during certain periods. Granted, the probability of this would seem to be quite low, and each user would really have to be hammering those links constantly to cause a problem. But edge cases do sometimes emerge and if such an issue did occur then how would you resolve it or at what point does it become something that needs a specific solution (ordering extra backhaul bandwidth etc.)?

Jeremy said:

Our backhaul is not a constraint. Our infrastructure runs from BT exchanges, and we use either Dark Fibre or 100-Gbps and are in the process of upgrading to 400-Gbps. Bandwidth consumption is increasing but it’s a lot slower than our ability to scale our backhaul, so we’re not concerned by this. We have many “power” users on that network and capacity, even with 80,000 customers, is far from being a constraint.

7. Speaking of insanely good connectivity speeds, we’ve already seen the odd UK network playing around with 25G-PON technology, while a provider in Qatar recently went as far as to launch a 50Gbps package for homes using 50G-PON technology. In terms of future network platforms, what do you expect Netomnia to adopt after XGS-PON and why?

Jeremy said:

I always considered 25G-PON to be dead before it was born because of the technology cycle and roadmap (especially from China to drive volume). A little bit like NG-PON2 when Verizon or CityFibre were considering it. It was obvious (to me at least) that it would not go anywhere. The next step for us is 50G-PON because it’s fully compatible with XGS-PON and because we only have XGS-PON on the network it is easy to use combo optics to have XGS-PON and 50G-PON at the same time on the network.

NOTE: Since asking this question Netomnia have become the first UK provider to adopt ADTRAN’s 50G-PON technology (here).

The interview continues on Page 2..

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
34 Responses
  1. Avatar photo Jordan says:

    Good interview, love the CEO of YF

  2. Avatar photo Big Dave says:

    Just a reminder Jeremy did an interview with Richard Tang of Zen a while ago here:-

    https://youtu.be/fkhE6Wg0myA?feature=shared

  3. Avatar photo Wannabe Youfibre Customer says:

    Guys a Legend. Just wish they would eventually start their Tonypandy rollout!

    1. Avatar photo Another wannabe YF customer says:

      Bear in mind even if they do bother to build in your town, they might not build all of it, and you could still be disappointed.

    2. Avatar photo Phil says:

      I looked through a lot of streets in Tonypandy and they seem to be mostly through electrical poles, maybe that’s why, it’s a separate license that’s hard to get

    3. Avatar photo XGS says:

      ‘Guy’s a legend…’

      True. Force of nature 🙂

    4. Avatar photo XGS says:

      I’m pretty sure they aren’t going to restart it as things stand as they don’t want to overbuild Ogi. They’ve tended to try and avoid overbuilding other altnets even when they’ve done some civils in an area.

  4. Avatar photo Ex Telecom Engineer says:

    The recurring theme throughout the interview is the reliance on PIA price regulation to sustain Netomania’s business model.
    One sentence particularly caught my eye, “A fair outcome would be for Openreach to provide a like-for-like replacement from the OHP at their own cost”; The exchange closure program has been known about for years, if this increases the PIA costs for Altnet’s, why should it be Openreach’s responsibility to subsidise Altnets who haven’t planned for the event?

    1. Avatar photo R says:

      That would be for ethernet services and similar which he doesn’t consume. It was mentioned that it wouldn’t affect then.

    2. Avatar photo Jeremy says:

      Thank you R 🙂

    3. Avatar photo Ex Telecom Engineer says:

      R that’s why I used the term “Altnet’s” instead of Netomania in the second paragraph; I was commenting on the comment, not what Netomania are doing themselves.
      It doesn’t change the fact that OFCOM are placing a regulatory stranglehold on BT/Openreach and creating the environment for companies like Netomania and ZEN to profit. Without the OFCOM boot on BT’s neck the Altnets business model would evaporate, since BT would likely price them out of the market by competing aggressively on price.
      There are basically two types of Altnet, the wholesale providers like CityFibre, VMO2/Nexfibre, etc, and you only have to look at how things kicked off with the Equinox offerings to see how regulation affects them; Then there are companies like Talktalk, ZEN and Netomania who piggyback on BT/Openreach, and other’s networks, who take the opposing view and want Openreach wholesale pricing as low as possible. I believe OFCOM’s plan is to eventually push BT to completely spin off Openreach, with it becoming the Telecom equivalent of the National Grid; I don’t see that happening until BT’s Pension deficit is resolved and all Fibre rollout’s are completed.

    4. Avatar photo XGS says:

      Ofcom are there to look after customers and the industry as a whole, not to pander to the needs of Openreach or BT Group’s shareholders. It is neither in the customers’ best interests or the industry as a whole to return to the Openreach/VMO2 duopoly or, worse, have Openreach edge out investment from anyone else and end the VMO2/Liberty Global expansion alongside all the altnets.

    5. Avatar photo XGS says:

      Incidentally Netomnia don’t piggy back on Openreach’s wholesale infrastructure. They colocate equipment in Openreach exchanges and use cablelinks to get out of the exchanges then lease space in the physical infrastructure. They are not a TalkTalk or a Zen that do not have any of their own fibre serving homes and businesses. They belong with CityFibre and VMO2 in your lists.

      This is kinda weird:

      ‘One sentence particularly caught my eye, “A fair outcome would be for Openreach to provide a like-for-like replacement from the OHP at their own cost”; The exchange closure program has been known about for years, if this increases the PIA costs for Altnet’s, why should it be Openreach’s responsibility to subsidise Altnets who haven’t planned for the event?’

      Response: ‘That would be for ethernet services and similar which he doesn’t consume.’

      Follow up: ‘R that’s why I used the term “Altnet’s” instead of Netomania in the second paragraph; I was commenting on the comment, not what Netomania are doing themselves.’

      You started off talking about PIA costs being increased, then after being told it was Ethernet services, etc, agreed claiming that was what you meant all the time and seeming to miss that those are nothing to do with PIA?

      For clarity: what impact do you think that the exchange closure programme will have on PIA?

    6. Avatar photo Jeremy says:

      BT has a monopoly because it was given an asset by the government and paid by the tax payers. This asset (Duct and Pole) is regulated to enable sharing.

      It is important to note that Openreach chose to focus more on FTTC than FTTP which forced large CPs to invest in far too many exchanges, after this investment now Openreach decided to close BT exchanges…hence my comment that Openreach should bear that cost…BT chose FTTC over FTTP and made all of us pay for it.

    7. Avatar photo Peach says:

      Strange point about investing in exchanges considering most of the FTTC is linked to parent exchange and not child exchanges that are due to be closed

    8. Avatar photo Ex Telecom Engineer says:

      “BT has a monopoly because it was given an asset by the government and paid by the tax payers. This asset (Duct and Pole) is regulated to enable sharing”
      I’ve read this type of comment many times. The Government sold BT, with the shareholders buying the company, the Government didn’t give anything away.
      “In November 1984 the Government offered 3,012 million ordinary shares for sale”,”The total amount raised was
      £3,916 million”.
      “A second issue took place on 21 November 1991 which saw 1,598 million shares being sold, raising £5 billion for the Government”.
      “A third issue followed in July 1993 with the Government selling off virtually all of its remaining shares for a further £5 billion”.

      https://www.bt.com/bt-plc/assets/documents/about-bt/our-history/bt-archives/information-sheets-and-timelines/privatisation.pdf

      According to that document shareholders paid the Government over £13 Billion in aggregate for BT, so tell me what was given away? Where the Government have subsidised FTTC and FTTP, I agree that it’s only fair that BT should be made to share the access/infrastructure, but OFCOM have created a situation where BT/Openreach have to share all their access infrastructure, which was paid for by the original shareholders at a higher price than the current Market Cap. Wouldn’t you agree that the Government didn’t give anything away?

    9. Avatar photo anonymous says:

      IF BT were not so rubbish and trying to do the minimum they can get away with all the time, then you would not have ALTNETS now. BT tried for years to say FTTC was all people needed and fast enough.

      The government may have sold GPO off as BT, but it was still cheap as chips compared to someone coming in and setting up from scratch. They had a good start as a new company. Ofcom have given ALTNETS a good start (they don’t inherit anything) by mandating BT share their physical infrastructure. Admittedly, this should work the other way as well.

    10. Avatar photo - says:

      I think you misunderstand. A key component of FTTC was the ‘copper line’ which goes back to the exchange. It’s quite true that e.g sky could pick up the data component at the parent exchange but it couldn’t pick up the copper line, so lets say they Unbundled OHPs only:

      -Would have to buy a ‘resold’ line rental/calls product such as WLR, unable to offer good rates on calls and line rental which would hamper thier competitiveness. Even if they decided to do SIP over the FTTC and found a way regulation/compatibility wise to do that years ago they would STILL have to buy WLR regardless as the copper line rental was a part of FTTC, there was no SOGEA as is only just now being introduced.

      -Unable to offer ADSL services to those not covered by FTTC, as openreach decided only to cover those it chose, not universal.

      By the way even the 1100 OHP exchanges is a totally mad number. We need one per city and surrounding area. London, Manchester and Birmingham are the only ones that may warrant multiple (8,2,2) exchanges. Approx 50-80KM gaps (by road) between exchanges depending on density is ideal from an efficiency perspective.

    11. Avatar photo - says:

      Not to mention EAD services are still not OHP based, so any customer leased lines, cell backhaul and so on would only be able to be cost effectively sold on 1/5th of exchanges which makes competing for framework/wholesale/gov business very hard.

  5. Avatar photo N says:

    CF have effectively stopped building whereas they are trucking on at almost a million prems per year.

  6. Avatar photo GG says:

    Pull yer finger out and start deploying in Berkhamsted. There’s a lot of very deep pockets here and only BT or Virgin to choose from with no fibre from either.

    1. Avatar photo Yatta! says:

      Those who demand get nothing.

  7. Avatar photo Stuarty says:

    I met Jeremy while working at an old job for an outsource provider YF use. I found that he is a man who just wants to get things done, some of his managers were not as forward thinking, but when Jeremy seen the points the outsource client was making he agreed and forced change. Very good stuff from someone who seems to be out to do good.

  8. Avatar photo MikeP says:

    Oh, those comments about being capital-efficient. The very antithesis of the “land-grab” approach of almost every other altnets, guaranteed to be capital inefficient.

    1. Avatar photo anonymous says:

      Perhaps if BT had got their finger out years ago when sweating copper with FTTC and GFAST, there wouldn’t be any ALTNETS forcing them to do FTTP now, and still BT have an inferior asymmetric product with GPON.

    2. Avatar photo XGS says:

      Okay, anonymous, but that has what to do with either what you’re replying to or the article? Mike’s point doesn’t refer to Openreach in any way, shape or form, and he’s absolutely right.

    3. Avatar photo anonymous says:

      Disagree. He was commenting on all Altnets which isn’t true. Some have questionable investment areas for build, build techniques and pricing whilst others (like Netomnia) don’t. There was no support for any ALTNET in his statement, hence the implied support for Brokenreach.

  9. Avatar photo Big Dave says:

    If you can do it yourself at £250 per premises You would have thought they’d be somewhat unwilling to pay more than that to buy another network. On the other hand If someone else had spent £1000 per premises passed offering £500 per premises passed would look good value to the purchaser and doubles the money of the investors…..

  10. Avatar photo Yatta! says:

    Netomnia have deployed to road less than half a mile from my home, I’m hoping that they extend their reach to me, I’d sign-up to their/YouFibre’s symmetrical gigabit service immediately.

  11. Avatar photo Martin says:

    Not sure I see it happening, but could be quite cool if an altnet like Netomnia and Three were to join forces, if the Thee/Vodafone merger was to fail.

    It could become a challenger to BT/EE and VM/O2

    I expect we’d need to see a little consolidation first though

  12. Avatar photo Ian says:

    YouFibre booked my install last week, phoned mid way through the day and said engineer was sick… next available slot is 27th May. I have had to chase them all week to get a date, never contacted back on multiple occasions. Not a great experience to start with. My contract is up with Sky soon and i’ll probably have to renew with them 🙁

    1. Avatar photo Yatta! says:

      Better late than never. When I looked to see if I could sign-up (which I cannot unfortunately), I saw that YouFibre will buy you out of your existing contract, so see if they’ll do that with you. Or alternatively you could let your Sky subscription roll outside of your contract and see if YouFibre will compensate you for the additional cost?

  13. Avatar photo FibreEng says:

    @N

    Cityfibre may have slowed down but their premises count is 3.2m RFS, even if Cityfibre stop and don’t acquire anyone else it’ll still take them above Netomnias 2m plan.

  14. Avatar photo anonymous says:

    wow, bit strange all these people proclaiming the love for a man they’ve never met.
    why? because he runs an ISP properly?

Comments are closed

Cheap BIG ISPs for 100Mbps+
Community Fibre UK ISP Logo
150Mbps
Gift: None
NOW UK ISP Logo
NOW £24.00
100Mbps
Gift: None
Virgin Media UK ISP Logo
Virgin Media £26.00
132Mbps
Gift: None
Vodafone UK ISP Logo
Vodafone £26.50 - 27.00
150Mbps
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
BeFibre UK ISP Logo
BeFibre £19.00
150Mbps
Gift: None
Community Fibre UK ISP Logo
150Mbps
Gift: None
YouFibre UK ISP Logo
YouFibre £22.99
150Mbps
Gift: None
Hey! Broadband UK ISP Logo
150Mbps
Gift: None
Large Availability | View All
The Top 15 Category Tags
  1. FTTP (5720)
  2. BT (3569)
  3. Politics (2602)
  4. Openreach (2342)
  5. Business (2322)
  6. Building Digital UK (2277)
  7. FTTC (2061)
  8. Mobile Broadband (2039)
  9. Statistics (1830)
  10. 4G (1724)
  11. Virgin Media (1674)
  12. Ofcom Regulation (1494)
  13. Fibre Optic (1426)
  14. Wireless Internet (1417)
  15. FTTH (1383)
Promotion
Sponsored

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