ISP Sky Broadband UK to Launch CityFibre Based FTTP Packages UPDATE
In a big development, Sky UK (Comcast) has this morning announced that they’ve finally reached a “long-term partnership” (wholesale) agreement with alternative network operator CityFibre, which will enable ISP Sky Broadband to finally launch a new range of multi-gigabit speed capable full fibre (FTTP) broadband packages “from next year“.
All of Sky Broadband’s packages are currently served via Openreach’s national Fibre-to-the-Cabinet (FTTC) and Fibre-to-the-Premises (FTTP) networks, but it has long been expected that Sky might choose to expand their reach via CityFibre too.
Part of the reason for this stems from the fact that Sky has worked together with CityFibre before – over a decade ago in fact – via a Joint Venture with TalkTalk to pilot FTTP networks in the UK (aka – Ultra Fibre Optic), which was later re-named FibreNation and sold back to CityFibre in 2020 for £206m (here). At the time of that sale, Sky Broadband had already downgraded their involvement, but they remained a wholesale partner.
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However, it’s taken another four years for CityFibre to finally succeed in converting Sky Broadband to a full wholesale partnership on their national network, which is a move that may well cause some concern for Openreach (BT). Sky is the UK market’s second-largest provider of residential broadband services, with around 5.7 million customers, although Virgin Media are very close to taking that spot.
CityFibre itself currently aspires to cover up to 8 million UK premises with their new FTTP network (funded by c.£2.4bn in equity, c.£4.9bn debt and c.£800m of BDUK subsidy) – across over 285 cities, towns and villages (c.30% of the UK). But it remains unclear precisely when this will be achieved. The original goal was for the end of 2025, although their current build + M&A plan may get them up to c.6m (if it all goes well).
Amber Pine, Sky’s Managing Director of Connectivity, said:
“Sky’s new partnership with CityFibre will mean we can provide fast, reliable and great value broadband to more homes across the UK. This will mean we are able to reach even more people with full fibre, which is essential for the modern home.”
Greg Mesch, CEO at CityFibre, said:
“This partnership with Sky is a huge vote of confidence in our business and has cemented CityFibre’s position as the UK’s third digital infrastructure platform. With demand for digital connectivity continuing to grow, CityFibre’s network can provide the quality and reliability that people need and the infrastructure competition the UK deserves.”
Sky should benefit from the deal by virtue of the fact that they’ll be able to launch faster (symmetric speed) and more competitive full fibre broadband packages, often at lower prices, into areas currently covered by CityFibre’s network (these will be given preference in areas of overbuild with Openreach). The ISP will also benefit from having access to CityFibre’s planned deployment to 1.3m rural premises under their Project Gigabit contracts (inc. both subsidised and complementary commercial build).
On the flip side, CityFibre will benefit through the addition of a third major ISP after Vodafone and TalkTalk (fourth if we also consider Zen Internet’s contribution), which has the potential to significantly increase take-up on their new network. This will in turn help to support their economic model for future deployments and improve investor confidence.
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The move may worry Openreach, which has tried to keep Sky Broadband on their side (the earlier Equinox discounts on FTTP may have played a role there) and now risks losing more market share to alternative networks – at an increasingly rapid pace.
On the other hand, Openreach may now find it easier to argue with Ofcom that they should be allowed to further discount the wholesale pricing of their own FTTP products. On top of that, they’re also planning to launch their own symmetric speed FTTP plans from April 2025 (here), albeit initially with some very limited availability.
Sadly, what today’s announcement doesn’t tell us is precisely what sort of packages and prices will be on offer or exactly when in 2025 they’re going to launch them, but no doubt that information will surface in due course. We wouldn’t be surprised to see a new broadband router being introduced to support all this too in 2025, particularly for their future multi-Gigabit plans.
UPDATE 12:41pm
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Sky’s announcement has so far caused BT’s share price to tumble by almost 7% today (c.£1bn in value).
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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No thanks, we don’t want them, they can stick with openreach!
Speak for yourself Openreach fanboy
Indeed. Keep the riffraff off our packets!
on the other hand – it strengthens openreach’s case that they should be given a lot more freedom to operate, especially in areas with cityfibre and other altnet availability. Sky will want Openreach to compete on pricing, after all.
Like a return of the old market A / market B system.
Fantastic news! The CityFibre is far superior and I can see this leading to many customers switching over where they have access to the CF Network.
“far superior”? it’s the same technology from the same vendors, and there are areas in which OR probably have the technical advantage.
I would bet money that Sky won’t willingly offer anyone a choice of network provider. Unless OR is finally granted more pricing freedom, you’ll be provided with CF if available, OR if not. Sky will probably charge the same price for the same speed and pocket the difference themselves, like the other multi-supplier ISPs do.
This is like an even nicher example of commenters here insist that everyone desperately wants symmetric speeds. Even fewer people care about whose name is on the ONT.
Hello BT Ivor 🙂
The poster was correct. Cityfibre’s superior network. Symmetric and XGS-PON unlike out dated legacy GPON that BT are still peddling out thinking they have the correct strategy with its asymmetric speed offering. BT central core may be great, but to the end user via GPON, nope.
How is BT’s symmetric offering? I heard only on one speed tier to a few new selected areas starting from April 2025? Ah, yes. Cityfibre offer multiple speed tiers at decent pricing, with symmetric to all and right now to their network footprint, bar very small areas that are being upgraded from GPON to XGS-PON that typically were the first areas to go live.
Ivor
Plently of ISPs offer cheaper pricing on the Cityfibre network compared to openreach when both are available and the difference on the 900mb option is around £12-15 in favour of Cityfibre
The Openreach fibre network is superior. No hundred metre or more runs down a microduct to a cabinet. All underground or on poles and CBTs almost always at closest possible point to customer. Fewer premises sharing each port. Capacity planning stricter.
The CF network has cheaper, faster products being sold to its customers through ISPs thanks to limited XGSPON and different profiles on GPON. They win on the stuff either side of the fibre network.
We buy products not networks so no need to care if it doesn’t change performance.
what benefit does a closer CBT give? The only difference i can see is that Cityfibre are now deploying a 64:1 split vs 32:1 for OR. Could give OR an edge in the future when both on XGS-pon
100 metre runs are nothing, and poles are exactly the be all and end all as the wires can be targeted by vandals with bricks, or lots of big birds sitting on the line in a country lane scenario or winds breaking them on fen land for example. XGS-PON IS superior to GPON, and most of CityFibre’s network IS XGS-PON with any small amount that started on GPON being migrated over in a project plan, if its not already complete that is.
@Ivor, a lot of the Alt nets network is better than Openreach network, a lot uses XGS-PON, which is more advanced than what Openrerach uses.
This made me laugh “Sky’s announcement has so far caused BT’s share price to tumble by almost 7% today (c.£1bn in value).” Is BT/openreach so fragile that sky saying they are going have a second option made the share drop so much? It is just a second option, they are not dropping Openreach, just using giving some people a second option.
I don’t think much of two of the ISP on their network, Talk Talk and Vodafone, sky should be a good match. All three are as bad as each other, come to think of it, nothing can be as bad as Talk Talk.
Will packages on Cityfibre be slightly cheaper than on Openreach like Vodafone?
I can’t see that happening especially from Sky, it’s all about profits so that savings will just be pocketed and not passed on
It will be a miracle if they actually go live where they have laid cable here!
Half an area is done and it’s been paused on “building” ever since. The houses next to the street they paused on has said “planning” on their website for months too!
So frustrating. The first half of the year there were LA defect and linking near the exchange, but since the start of the summer, nothing.
Well if Sky aren’t cheaper on CityFibre then there are other ISPs that are. Zen I believe are cheaper via CF than Openreach.
Excellent news for Cityfibre!
Congratulations to Greg Mesch and his team.
Defo not an OR fanboy, @Dave – I hate them, I’m a Cityfibre man! I hate that OR won’t do symmetrical though the technology is 100% capable
If anybody hasnt read between the lines, a new hub is launching next year after the next Comcast ‘gateway’ to properly support gigabit and beyond.
Funnily enough, this was shelved in 2022 to cut costs. But there is a now a company-wide push to maximise connectivity revenue as Sky perceives itself to be struggling.
It’s also desperately needed in Italy. As basically everyone else but Sky has got over Gigabit packages and their strategy of consolidation through cheap offers to TV customers is now losing momentum (I heard of even 15€ a month for 18 months) they are now a bit stagnating in that market and won’t grow if they don’t launch something better. Sadly it’s all a matter of “I want the bigger number” over there.
Yes it’s a shame. Execs curbing engineering &innovation and are constantly making the wrong bets or backtracking… Sky’s original altnets project was also shelved 2 years ago.
Comcast are not willing to bank-roll Sky any further. They want returns.
Equinox IIII just got given the green light.
Exactly what I was thinking
Calling Jean Michel Jarre!
Where does this leave Nexfibre and VMO2?
At the dance but without a partner.
Punch in the face for Brokenreach with their outdated legacy GPON network and asymmetric speeds. Market working well so far…..Lets hope as many as possible jump to the superior network that Cityfibre has. BT never learn, having fudged FTTC (and FTTC could have been 100mbps as standard but BT chose not to do vectoring) and to this day, still roll out GPON, whilst others deploy the correct strategy.
Is there customer demand for >GPON at present?
A number of ALTNETS providing symmetric to their subscribers, and Sky obviously looking for enhanced service from Cityfibre that offers it for their customers. XGS-PON isn’t just about symmetric though, its about increasing available bandwidth on the node splits so that traffic flows aren’t congested. When Openreach do their GPON symmetric April 2025, they’ll have to be really careful about contention….
hence there doing xpon april 2025 and no doubt at some point all new areas will be xpon. guessing the near 40% openreach full fibre take up is no good then. cityfibre was coming here but stopped a year or 2 back as there contractors went bust and no sign of the works restarting ( as its been a good year or2) openreach full fibre is meant to be a year or so away where i am, so cityfibre will have lost any advantage if they ever bother to restart laying cables etc
Openreach’s takeup rates would suggest that most people don’t care about whether it’s GPON or something newer. Ditto symmetric speeds.
Some will claim “enhanced service” (lol!), but in reality it’s down to price. Openreach can’t sneeze without Ofcom approval whereas Cityfibre can charge whatever they want, and I guess they’ve finally offered a cheap enough price to make the risks, integration challenges and ongoing support hassles worth it.
I do wonder how much of CF’s network will be in play though. I tried a local address on Vodafone’s website, one that should have both Openreach and CF and would expect it to offer a CF connection, and yet it didn’t.
As another commenter says (and as I have said above), I’d expect Openreach to be requesting another round of price cuts in the not too distant future
Graham – Openreach will still be doing GPON; hence only one higher tier and selected areas where probably there are low numbers to a split. No announcement on XGS-PON roll out.
BT Ivor – If BT had got their finger out some years ago and spent some money on investment instead of trying to sweat copper and telling everyone it was rain falling on their head instead of urine, then they would have had the market now and no room for competition. The actual truth is, that until competition came along, they did sweet F.A.
@anonymous
Openreach will be going XGS-PON using Adtran’s combi GPON/XGS-PON kit. You can’t do synchronous speeds with GPON, the max unlink is half the downlink speed. That is why it will only initially be in new build areas only.
Cityfibre have been doing symmetric speeds (1G/1G) on GPON for years.
Together with the news about Zen joining Trooli last week things seem to be finally moving in the altnets favour. The question now if the national ISPs start to provision more on the altnets is whether Openreach start to scale back their own build. Andy Conibere in his interview with Richard Tang last week went as far to suggest that if an altnet had been in a particular area and had gained enough take up via various ISPs like Sky, would Openreach continue to build just to serve BT/EE? The argument then went on to say that the bean counters in BT could then look to provision over said altnet as it would then be more cost effective for BT. Matthew Hare of Zzoomm also has also made the same point in his interview with Richard.
> The argument then went on to say that the bean counter
I would be *very* surprised to see BT providing service over anything other than their own access network.
If Openreach have a location where there has been another network for a while with High uptake with other big name ISPs on it and with a high take up and it is uneconomic for them to build their own does BT just abandon that location altogether or do a deal? First rule of capitalism: Don’t make yourself what your neighbour can make more cheaply, so would they not do a deal if it was in their interests to do one. Companies need to be ruled by common sense, not ego.
I could see them serving CityFibre on only Project Gigabit areas. They can save face somewhat as taxpayer funds are used to fund those areas.
There is considerable cost in integrating with an altnet. For small areas it maybe cheaper to do a not particularly economic Openreach FTTP rollout than to integrate with an altnet.
I wonder if we’d ever see Openreach resell CityFibre services in Project Gigabit areas, allows BT to skim a little off the top for who only want to use Openreach.
I like it moving in altnets favour, it is just a shame that people who are with ISPs on openreach FTTC network don’t seem to want to move away from Openreach. This is the problem, people tend to stick with what they know.
I can understand why people do, it is the risk or worried about things going belly up, I know I had the same worries, which is why I was willing to stay with Plusnet on FTTC. I made the jump to Zzoomm and while I don’t really need the speed, I am glad I did.
I was considering going back to FTTC, but changed my mind and signed up for another 12 months with ZZoomm.
Since City fibre by it’s name overlaps with OR, the only real advantage will be the symmetrical speed, which I’m unsure as to what advantage most Sky users will see. Gamers and streamers will be happy.
But without a lower cost option most people are unlikely to change. So it will be down to new customers pick up to take this on.
This all depends on Skys marketing and pricing as other ISPS that cover both networks like No One and Vodafone as 2 examples offer much cheaper prices on the Cityfibre network
Had a letter through the door in July 2022 saying a CityFibre build was starting inside two weeks.
Never even saw them, still no FTTP in my area. 🙂
City Fibre Wrexham! No Way, Don’t tell Netomnia! Just out of curiosity which bit is your area roughly! 😉 😉
I’m in Coedpoeth, it was strange. Letter through the letterbox in 2022 then absolutely nothing. I even checked the coverage on their site and there was nothing for the area.
Great news for UK consumers, as retail prices will fall as ISPs switch to the lowest cost provider. Not so great for investors in networks that are selling capacity at prices that don’t replay the build costs.
In the longer-term, choice of network will be dependent on service quality. Will the loss-making networks (like CityFibre) be allowed to retain enough funds to operate a decent service, or will the investors want to recover some of their losses?
Cityfibre are now EBITDA positive
https://cityfibre.com/news/cityfibre-exceeds-400-000-customer-connections-and-achieves-profitability
“Retail prices will fall” I have yet to see any ISP drop prices, unless it’s a short term catch and keep for new customers.
@Anon EBITDA is operating expenses only, it doesn’t include interest on debts or capital expenditure, though it does include depreciation on assets.
Given CityFibre’s large debt I wouldn’t assume whether CityFibre is profitable.
Can see this taking a while before its fully integrated.
Sky still haven’t folded See The Light (OFNL) into their main offering, after 2 years.
It’ll happen, any delays would be on the router. But it makes sense for Sky to start with CF. The map-t stuff is unlocking new potential in the network by switching to a lot of new platforms that have been built over the years for other regions.
Sky already supports 4 different Full-Fibre network operators in Ireland (including VM).
With the 5 biggest providers now using 3 different networks, time to take the shackles off of BT and let them slug it out on a level playing field.
It will be interesting to see what the pricing strategy will be and will they in areas where there is Openreach and City Fibre give you the choice of what network to use
They’ll probably follow the example of Zen and if CityFibre is available then CityFibre they will use. It will be interesting to see what they do with existing customers on Openreach FTTP, my guess is that they will wait until the contract is up for renewal and then move them across.
Price wise is probably much of a muchness Cityfibre will get priority over OR, Cheaper wholesale rates etc.
I doubt they’d do any forced migrations. Customers are not going to tolerate being moved from OR to CF (ie gardens dug up, holes drilled, yet another box on the wall) for no actual benefit to themselves. It won’t provide a faster or better service in the way copper to fibre will.
For new customers they could potentially insist that it must happen, though I wonder what they’d do if someone already has an Openreach ONT and wants to carry on with it.
I wonder if Sky are going to treat non-Openreach customers differently for auto compensation in the same way that TalkTalk and Vodafone do, or if they can use their clout to get CityFibre to up their game a bit.
It will be interesting to see what happens in areas of overbuild.
“So Mrs Watkins, we’ll renew your Sky broadband for another £24months at £nn we’ll send an engineer round to fit your fibre”
“But I already have Sky fibre”
“Ah yes but that’s Sky OR fibre and it’s cheaper for us if you have Sky CityFibre”
“I just want to renew my contract”
“Don’t worry it’s only another small hole in your wall and another little box inside”
“You’re just swapping a box?”
“No, you’ll have two boxes”
“Can’t you take one away?”
“No because that box is OR’s, you’ll need a CF box now”
“But I just want Sky”
“I know, but was Sky OR, and now we have Sky CF”
“Can I keep Sky OR?”
“Urn, computer says No”
Mrs Watkins, we can renew your broadband on Openreach at £45 per month but if you allow us to install CityFibre it will be £35 per month.
This will give Sky the ability to sell FTTP to the urban areas Openreach have decided to skip.
Hopefully CityFibre will come to Cuckoo Oak, Telford I rather to have CF than OR. I don’t want Openreach FTTP now.
Screenshotted.
But the reality is most of cityfibres network in not XGS-PON its GPON, it was supposed to be upgraded and you will see a figure if you search the interwebs of 90% has been upgraded, but its not, cityfibre wont actually tell you how much is XGS-PON but its not 90%, it is a small percentage of existing installs, all new installs are XGS-PON but the existing was and is GPON until its upgraded.
It may highlight the need for the ONT to the street fibre being able to be transferred if you change supplier. Having to have a new fibre and ONT each time is not practicable, I doubt there is even room to get a second fibre pulled through
It is an issue that has not really been addressed to date probably because few people have switched
Easier if you’re fed from poles. I’m guessing for most people the maximum would be 3 fibres and 3 ONT’s (although VM and some altnets are using integrated ONT/Router so I’m guessing in that case you get terminated in a green fibre wall socket?) i.e. Openreach, VMO2 and altnet. Mark Jackson said recently he was heading for his 3rd ONT.
Well this should be fun, everyone inside CF knows the network is a mess with fudged RFS.
@CF Propaganda, you got that right mate…
CF installed 4 cabinets down my street 2 years ago and destroyed the paving, Openreach followered them behind and reinstated the JF4 boxes they wrecked.
Still not RFS
Surely this will massively limit their customer base? considering cityfibre isn’t available in anywhere near the number of places as openreach. It’s not available for me at all, in fact for me it’s openreach or virgin media.
They will continue to provision via Openreach where CityFibre isn’t available. This won’t affect their existing agreement with Openreach.
I would literally bite the hand off any FTTP supplier alas neither openreach nor cityfibre want to supply my road in Andover :/ Gonna be starlink at this rate.
It is far too early to conclude what will happen.
By connecting to the City Fibre infrastructure Sky immediately gets options. However where it chooses to use them (postcode or even premise) and on what products they can control at a very detailed level. It wouldn’t surprise me if the OR XGS-PON (overlay or new) products next year align with Sky’s future product expectation. Zen currently have specifically have two tiered pricing between City Fibre and OR based services but I would have though Sky will want more consistency across products.
The biggest cost now is the final lead-in for FTTP, especially if it requires cabling and especially civils. Therefore I can see a situation growing where once someone has made the move to OR/VM or Altnet FTTP they will stick with ISPs on that wholesaler network encouraged by ISP pricing to reduce their changeover cost. Would Sky move someone to a different wholesaler network if the higher product can be supported on the current wholesaler. So expect next door neighbours with the same products on OR and City Fibre.
As for symmetrical products if it is offered to the customer they may actually use it. The ISPs need to judge whether to offer it by default or at price premium (as networks are loaded).
Altnet pricing is still being driven by investment subsidy and the market share scramble.
Many Sky customers do not need much broadband for on-demand, Q box update and casual browsing. So Sky will need to keep pricing of entry level FTTP (included in their bundles) as low as possible.
Lots of increasingly commercial rather than technical decisions here.
> Many Sky customers do not need much broadband for on-demand, Q box update and casual browsing. So Sky will need to keep pricing of entry level FTTP (included in their bundles) as low as possible.
Not for Sky Stream or Glass though. You need 35Mb per UHD stream, thats 70Mb out the door if you’re on multi-room.
Sky’s satellite TV business growth is over, it’ll slowly decline as they push people on to their Stream / Glass service. I don’t even think there’s a way to get a new Sky Q install on the sky website right now, without googling Sky Q and going directly to the Sky Q page.
Within a few years they’ll be pushing hard to move Sky Q > Sky Stream.
Sky have been pretty clear they want to push everyone over to streaming and come off satellite. Their current contract with Astra only runs to 2030 which is pretty much when the FTTP program will be complete. They have already started to reduce the number of engineers.
Providers can and do choose to offer difference prices depending on the network used. Talktalk used to charge an extra £15.32 a month to customers outside of the LLU network and on IPSTREAM broadband.
Zen charge different rates to customers depending on if they’re on Openreach or CityFibre based FTTP and in areas where both are available, they push Cityfibre and have even moved customers from Openreach to Cityfibre.
Ah, this and my recent test usuage of mobile broadband and a swap-out of the BT-SH2 for alternate kit, probably explains toda’s kindly, unsolicited text from BT asking “How are you finding our Broadband ‘Service’ ?” . . .usually its deathly silence . . as long as you keep paying.
After the DV fiasco last December . . . and all the pre-install publicity BS . . and then nothing and nowt heard since . . .I could probably wax lyrical sufficient for a poet laureate nomination.
Personally, I’m fed-up with doing “Favours” for marketeers and getting nothing back in return, so the text found its way into the bn.
City fibre already advertise fibre service as being available down my street . . . but as far as I know, no-one has laid-in in any street length fibre to the cabinet and BT Wholesale website still state Fibre is only on demand.
Conclusion: If I wanted fibre from City Fibre or Sky . . .I had to pay the costs of a 300 yard fibre run installation.
Disingenuous barstewards