Rob Bradley on Consolidation and Fixing the Turbulent UK Fibre Broadband Market
5. How much of an obstacle is diminishing asset values of built fibre in the ground? By this I mean situations where network operators have built FTTP, but then been overbuilt, or even overbuilt several other operators themselves (i.e. in some locations we see up to 4-5 full fibre operators in the same location, with 3-4 also in some smaller towns). This often seems to contribute toward some altnets having an unrealistic valuation of their physical network assets.
Speaking of which, is there a risk that some altnets may have to all but collapse before their network assets end up being acquired, or is this sort of outcome likely to be quite rare (i.e. perhaps it may be better for some to take a paper loss now than wait too long)?
Rob Bradley said:
This is a very real and growing concern, and one that stems, in part, from how success was originally defined in the AltNet market. In the early years, the dominant metric was “premises passed”, not “premises connected.” That emphasis drove a race to build, incentivising speed, footprint, and headline numbers, rather than take-up or commercial traction.
As a result, many operators delayed commercialisation efforts until after large-scale build was complete. But connections, not coverage, drive revenue, and the optimal model would have been “connect as you build”, ensuring demand generation, operational readiness, and monetisation occurred in tandem with rollout.
Against that backdrop, the assumptions underpinning many early AltNet business plans, particularly around take-up, exclusivity of footprint, and resale value of built infrastructure, have not held up in current market conditions. With over 100 AltNets operating across the UK, and many areas now facing 2–4 competing fibre networks, the reality is that some operators will struggle to achieve sustainable returns.
Business models often assumed 40–60% take-up; in reality, most are seeing less than 20%. And with a commercial viability threshold closer to 30–36%, the asset value of some built networks, particularly in overbuilt or low-density areas, is significantly impaired.
Unfortunately, this means some operators will not be able to refinance, attract buyers, or deliver on their original investment theses without significant write-downs. We are likely to see several cases where the fibre asset cannot be monetised in time, leading to insolvency before acquisition.
This is not the outcome anyone wants, but it is the result of how uncoordinated the UK fibre rollout has been outside of the BDUK framework. In rural areas, BDUK adopted a structured approach: defined intervention zones, competitive bidding, and aligned subsidy. That model ensured clarity, minimised duplication, and focused resources where commercial build wouldn’t reach.
In contrast, the urban and suburban rollout was essentially market-led, with few constraints on build location, limited transparency on planned coverage, and no overarching mechanism to coordinate footprint. This opened the door to overbuild, speculative expansion, and ultimately stranded investment.
In hindsight, a national BDUK-style model, with defined build zones and a competitive bidding process, may have created a more capital-efficient and sustainable national fibre footprint, not just in hard-to-reach areas, but across the whole country.
6. One often overlooked aspect is the time, complexity and cost – as born by the acquiring operator – of needing to integrate a new network into their existing infrastructure. Such networks often have many differences, which can be difficult to align.
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Is this an area that you’ve seen becoming a point of strain for negotiations around consolidation and how are operators choosing to approach it (i.e. how do they factor in the problem and costs)?
Rob Bradley said:
You’re right, this is one of the most underappreciated complexities in the current wave of consolidation. While network integration poses some challenges, vendor diversity, topology alignment, backhaul rationalisation, it is often the IT and systems integration that becomes the real constraint.
Most AltNets have grown with speed as the priority. Their systems, CRM, billing, service activation, field management, were often assembled quickly to support early-stage growth. In many cases, these platforms aren’t designed to scale, let alone integrate with another operator’s stack. As a result, the acquiring party inherits not only the assets but the operational and architectural decisions that sit behind them, many of which are hard to unwind without cost or disruption.
We’ve also seen that few AltNets have mature BSS/OSS frameworks. Provisioning journeys are often brittle. Data models are inconsistent. Customer service tools are fragmented. This creates real integration overhead, and often introduces risk to service continuity, billing accuracy, and customer satisfaction.
Some operators are starting to get ahead of this, either by investing in more modular, API-driven platforms that are easier to federate, or by running acquired entities in parallel with a view to gradual unification. Others, like CityFibre, have reached the scale where they can define integration standards and pull new acquisitions toward their stack. But for most, this is a major negotiation point, and we’re increasingly seeing technical due diligence include deep audits of platform maturity, integration complexity, and the cost to converge or rationalise operations post-deal.
Network integration is difficult, but systems integration is often what determines whether the commercial logic of a merger can be realised in practice.
7. How much merit do you think there is in smaller to medium-sized altnets choosing or try to tough it out as long as possible in order to remain independent, such as by continuing to focus on commercialisation.
Can they survive if some things turn more positive over time (e.g. lower interest rates) or is the die now cast, with consolidation being inevitable for almost all except those with a clearly defined and successful niche (e.g. community benefit providers like B4RN)?
Rob Bradley said:
There is certainly a role for community-driven rural AltNets in the UK fibre landscape. Providers like B4RN have demonstrated what can be achieved through deep local engagement, trust, and sheer determination.
But while this community-led model has clear social value, the idea of “toughing it out”, continuing to own and operate infrastructure end-to-end, indefinitely, may no longer be the most sustainable path forward, even for the most admired players.The economics of running fibre networks over the long term are fundamentally different from those of delivering retail broadband services. As networks mature, the cost and complexity of maintaining passive infrastructure increases: backhaul arrangements, resilience obligations, reinvestment cycles, and regulatory compliance all become more demanding without access to significant capital or operational scale.
Without a wholesale model, anchor contracts, or shared infrastructure arrangements, many smaller operators risk becoming operationally stranded, unable to grow, yet too capital-intensive to be sustainable in the long run.
A more pragmatic long-term model may be to build and monetise the physical infrastructure, through sale or lease to a larger infrastructure owner, while retaining the retail layer as a virtual ISP (vISP). For those with a trusted local brand and loyal customer base, this offers the best of both worlds: continued delivery of personalised service, control over customer experience, and a renewed focus on community engagement, without carrying the long-term burden of infrastructure ownership.
This strategy also opens the door to new partnerships, improved commercial resilience, and alignment with national-scale networks. Crucially, it preserves the operator’s identity, customer-focused, values-led, and locally embedded, while mitigating rising technical and financial risk.
For many rural fibre businesses, separating the infrastructure from the service layer, and evolving into a vISP, may be the most sustainable and strategically sound route to long-term success.
8. If we look ahead to 2030, what kind of structure or outcome do you expect to see in terms of how many fibre network operators exist and what portion of the UK market they control/cover?
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Rob Bradley said:
By 2030, I expect the UK fibre market to have evolved into a clear two-layer structure: a small group of large-scale infrastructure owners, probably 4 to 5 national or near-national fibre operators, and a diverse ecosystem of vISPs and branded retailers who ride on top of that infrastructure.
These large fibre operators are unlikely to divide the country neatly between them, we won’t see rigid geographic monopolies. Instead, I think we’ll continue to see some overlap, but with infrastructure increasingly rationalised and shared through wholesale platforms.
On the retail side, we’ll see differentiation through bundled services, mobile, energy, entertainment, VoIP, and through CX, community engagement, and brand.
In rural areas, I believe fibre will not reach 100% of properties. Instead, we’ll see increased reliance on satellite connectivity, particularly via Starlink or successors. As prices fall and capacity grows, satellite will become a cost-effective solution for the final 1–5% of premises where fibre just doesn’t make commercial sense. This hybrid infrastructure future, fibre where viable, satellite where necessary, will be a pragmatic outcome of current funding constraints and consumer tolerance for lower speeds in edge cases.
A more underappreciated evolution will be the shift toward cloud-centric network design. As businesses and even residential users demand low-latency, secure access to cloud applications, there’s an opportunity for wholesale fibre operators to offer direct peering or cloud interconnects, into hyperscalers like AWS, Microsoft, Google, etc. Whether through partnerships, own POPs, or cross-connect arrangements, these services could become a valuable differentiator in the wholesale market, especially for regional business ISPs, remote work hubs, or smart infrastructure players.
By 2030 we’ll likely have:
- 4–5 major fibre network operators.
- widespread vISP competition at the retail layer.
- satellite filling the rural gaps.
- and a growing set of wholesale services beyond just broadband, including cloud peering, security overlays, and private access products that add value to the glass.
We’d just like to take a moment to thank Rob for agreeing to be interviewed and providing such useful insights from a side of the market that often stays in the background.
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.
“But connections, not coverage, drive revenue, and the optimal model would have been “connect as you build”, ensuring demand generation, operational readiness, and monetisation occurred in tandem with rollout. In hindsight, a national BDUK-style model, with defined build zones and a competitive bidding process, may have created a more capital-efficient and sustainable national fibre footprint, not just in hard-to-reach areas, but across the whole country.”
Some of us have been making these very points in the comments section of this website for the last couple of years.
Monopolies (either geographical or over a particular resource) especially accompanied with a competitve bidding process are rarely (never?) good for consumers. On top of the ongoing issues of managing monopolies, investors not only need to build out the infrastructure, as now, but also pay for the right to the monopoly driving up costs. It’s true the overall amount of capital invested would be lower as there would be little cost to competitors of failure, but I really don’t think we should care about that – better luck next time to those investors.
Build and then they will come . This shows the ridiculous overbuild for what it is .A travesty allowed by government legislation permitted development for telecommunications installations and poor operator practise with little regard to any sound business practise and no regard to customers home environments and communities. Duplicate, triplicate telegraph poles . Telegraph poles where all infrastructure was underground and huge masts . Telecommunications code of practise that is unfit to ensure best practise and allows the ruin of our streets
“too many operators, with overlapping footprints and duplicated costs, serving too few customers.”
Exactly. Had the previous government imposed no overbuild until the majority of the country covered, perhaps DankshireTown would have had total coverage, instead of the situation of supplier (cannot name for legal reasons) who pulled out of BDUK. and the other supplier (cannot name for legal reasons) not completing the job.
Now our hopes on OR.
Even the FTTC rollout was a farce, controlled by Dankshire Council, who failed to understand the technology, resulting in many folks outside the 1km limit (as quoted in the Huawei installer manual. I wont mention we could have had fibre over 15 years ago unless I upset someone.
How is CDS?
@The Facts says:
How is CDS?
What is CDS
Likely still wouldn’t have anything. Without overbuild no race for premises passed so fewer networks around each focusing on profitability rather than growth. Take away the ability to pursue a ‘build it and they will come’ approach you also take away access to funding for it.
Wherever Dankshire Town is with all the dependence on government subsidy it’s presumably not considered an area likely to be profitable any time soon even with a monopoly.
On the wider point requiring no overbuild means telling Openreach that others may use their ducts and poles to build and Openreach then can’t use their own passive infrastructure to overbuild. That is unlikely to stand up to legal challenges without a huge amount of changes to various laws and leaves options of forcing network builders to build their own network with no use of PIA, pricing most of them out, or nationalising the most expensive bits of BT. For at best minimal coverage increase.
Dankshire town has a population > 10000, and properties > 4000, and is quite prosperous. It enjoys sub-standard broadband in many locations.
Infrastructure exists , combination of poles and ducts.
The point is that if the rollout had been sublect to no overbuild, then the town would have service quicker.
I know of another town where despite having greater population & properties, OR have now restarted building in the remaining half, where an altnet has already installed its infrastructure.
The government of the time clearly did not think broadband deployment out.
I don’t think banning overbuild would have achieved a better outcome. The cable TV networks were built in this way as companies held an exclusive regional franchise. We ended up getting heavily restricted coverage with entire counties left out, financial difficulties and mass consolidation, and that’s despite rigging it so that BT can’t adequately compete.
In the pre-broadband, pre digital TV era they weren’t offering all that much more than BT + Sky could offer, aside from it being a bit cheaper and without a dish. Does this sound familiar at all?
A very interesting article, with a clear statement of the current state and driving forces in the broadband market. Pretty much as would be anticipated from this consultancy. I hope this article will help some of the more optimistic AltNet proponents to temper their hopes with this insight into the deeper problems that sector is encountering.
The article makes special mention of CityFibre but still classifies the business as an AltNet. In my opinion, this business has already transitioned to a primary player in the broadband market and is fully capable of going head-to-head with some of the established operators.
However, I am also assuming that CityFibre will be a primary target in the anticipated game-play around the consolidation of the telecoms sector across Europe.
I think a lot of the AltNets will simply go bust as the fights for consolidation break out among the major European telecoms providers. The big plays will simply eat their dinner.
One way to drive consolidation without much expenditure of funds would be for Ofcom to cut the restraints on Openwave. If Openwave and BT were allowed to compete, many operators would need to act if they want to survive.
Further, if Ofcom does not remove the constraints, it could simply lose its whipping boy to consolidation in the European market with a major overseas investor that will have no truck with Ofcom’s unbalanced interventions.
By their own results announcements Openreach’s losses of customers are almost entirely confined to areas where Openreach haven’t deployed FTTP. Where they have built it they seem to be securing the majority of connections despite not being able to compete.
Openreach are achieving their uptake targets and there’s no evidence-based reason to liberalise regulation. Their baked in advantages around incumbency continue to offset their sometimes higher wholesale pricing.
@Polish Poler: There is every reason to remove the unbalanced regulation of BT and open the market to full competition. It is the unbalanced treatment of BT that has left its competitors protected from having to build out their own networks for a start.
A reasonable summary if somewhat long winded and euphemistic.
Re Q5; Yes a large number of altnets will need to be on the verge of running out of cash before they can be bought by another altnet on terms that will improve the aquirers unsustainable debt position.
Altnets that are highly overbuilt may simply go bust and much of their network fall out of use.
One aspect of consolidation that was missed is the need for altnets to increase prices to make their business viable.
Also VM are in no sense an altnet.
No and it’s a travesty that Nexfibre are even considered an altnet given their common parentage with VMO2 & the fact that VMO2 are their anchor ISP. I have no doubt this is just a workaround to avoid the scrutiny that Openreach gets from Ofcom.
Will customers who have moved to one AltNet where several exist side-by-side move to another when the discounted period of service ends with one supplier – will the substantial discounts (around 45%) continue to improve take up? If the discounted period remain as offering for ‘new’ customers then I can foresee plenty of churn without consolidation.
‘Cherry Picking’ where the AltNets provide to – e.g. some streets have OR + more than 1 AltNet whilst others have none isn’t entirely good for customer perception. Also customers hearing about the service won’t work when there are electrical failures isn’t entirely good to convince the customers to shift provider.
Home village has GigaClear FTTP available but the take up is very low after 15 months of the service being available. I know of a couple of people have moved their internet connection to GC FTTP but retained the analog phone service from BT. That may change when the discounted period ends as the service cost increases to a level similar to the BT charges. Or they may move back to BT when BT/OR has provided FTTP.
Another village has BT/OR FTTP and has had for some years, recently has seen CityFibre fibre up the village, whilst CF’s take up is higher due to the SKY connection there is substantial opposition as well due to CF’s topography – their need to have so much street furniture – something like 1 cab to 40 houses.
Of course the need to use full national number dialling on VoIP systems is seen as a disadvantage by customers, particularly in rural areas, probably more so than in towns. I know that the older people in villages that used to have 3 or 4 digit number lengths complained bitterly with the change to 6 digit number lengths; those who have moved to ViOP are even less impressed.
It’s always been necessary to dial in the full 11 digit number with mobiles anyway and yes I did have to reprogram the phone book of our handsets when we went over to Digital Voice but it does bring uniformity to the dialling process and that probably isn’t a bad thing.
Build and they will come Do they really think building unnecessary infrastructure , duplicate and triplicate telegraph poles or telegraph poles where all fibre infrastructure was underground in your potential customers home environments and communities will encourage residents to change ISPs ? Cheap broadband isn’t the be all and end all , good customer service and reliability do count . And when you have put that infrastructure in place putting residents at risk by poor health and safety practises it is hardly surprising the trust has gone. Choice of ISP is important , getting gigabit capable FFTP infrastructure to those who have not access, is important ,but these overbuilds of network show the negative impact of the telecommunications industry that is poorly regulated and has been given permitted development for telecommunications installations and exploited that poorly worded legislation to the full
At the risk of sounding a smartarse, the article (and as per comments by others) describes issues that have been thrashed to death (including me) and see https://shorturl.at/syLKo for background. Having said that the article is a good read. A couple of points, if I may:
1. Valuations are a thorny problem and as someone who has carried out a number of valuations e.g. the determination of “Fair Value” of Turk Telekom (TT). The TT valuation was a lengthy exercise and took circa 14 months. Smaller properties, inevitably, should take less time but the first thing I look for is the Asset Register and its “completeness.” Trust me on this one.
2. My own view is to forget trying to integrating possibly incompatible systems on acquisition. Determine which existing system suits the merged company best and stick to it subsequently and merge other data into it over time. Painful but once again trust me on this.
In many sunrise industries, there are often many companies that within 5 years have either consolidated or gone bankrupt.
The low take up rate doesn’t surprise me. Many of us on here are probably in the top say quarter of internet users with high consumption of streaming media, on-line games and interested in different operating systems with lots of downloads.
The regulator may to have to allow is to permit higher charges for legacy systems. A lot of uninterested consumers might move to full fibre premises when old copper products cost more.
Failing that, even a digital change over date such as happened with the ending of Analogue TV might be worthy of thought.
Low take up is an altnet problem. The legacy systems belong to BT/OR (or KCOM in Hull) who have much better take up.
After PSTN switch off in early 2027, OR will likely migrate customers to FTTP as quickly as possible. This still won’t improve altnet take up.
Ofcom already allow this, and they handled it badly, they permitted increases on legacy systems where no FTTP exists in the area.
A very interesting article with a lot of sense written. With my history of working in Telecoms now for more than 40 years and witnessed the build and take up of GSM, Broadband, FTTC and now FTTP there are, as always, similarities, but one thing drives them all – take up ! There are reasons why GSM, xDSL, FTTC and now FTTP is slow (read non existent) in many places and that is cost to deploy weighted against a low level of take up making a business case difficult. There used to be a connection based incentive that drove those under served areas to be dealt with, which then dissapeared with BDUK mark 2 (or is it a higher number) forcing companies to take big projects under a promise to build everywhere. This forced the smaller Alt Nets out that know how to deploy small scale and work with the locals, and now we have large chunks of the rural and ultra rural areas getting pushed further and further down the list by the big three – with some area’s probably never getting a comparable service. Bring back the Voucher scheme for Rural and ultra rural, paid on connection and let the Alt Net experts drive this continually under served customer base into the 21st Century. It seems mad that there are vouchers still available in London, Liverpool and Manchester (DIG areas) yet those living in small villages and hamlets get nothing and are still waiting.
Consolidation of the Alt Nets has stared to happen, but this isn’t helping those not served yet.