Study Highlights UK Competition Challenges of Netomnia’s Acquisition by Nexfibre

A new study from Point Topic has examined the impact on infrastructure level competition from nexfibre’s £2bn move to acquire full fibre broadband operator Netomnia (here). The analyst suggests that consumers in overlapping areas could see reduced infrastructure-level competition and less aggressive pricing over time, which may impact the Competition and Markets Authority‘s (CMA) assessment of the deal.

Just to recap. The owners of nexfibre (InfraVia, Liberty Global and Telefónica), which shares some of its parentage with Virgin Media and O2, announced in February 2026 that they’d reached a £2bn deal to acquire Netomnia (here), which had at the time already deployed their own full fibre network across 3 million UK premises (rising to c.3.4m premises and 500k customers by deal completion – expected by Q3 2026).

Nexfibre said the deal would unlock £3.5bn of investment in the UK market and help to upgrade 2.1 million of Virgin Media’s premises from coax (HFC) to full fibre (FTTP). The combined nexfibre and Netomnia footprint is expected to reach 8m premises by the end of 2027, which when combined with Virgin Media’s network could collectively reach 20m premises (c.10m if only looking at FTTP) and create a “scaled, financially secure challenger to BT Openreach“.

The deal has been promoted as one that could improve competition for national incumbent Openreach. But telecoms analyst firm Point Topic finds that in areas of existing overlap (overbuild) between the networks – equating to around 832,000 premises and 34,037 postcodes between Virgin Media O2/nexfibre and Netomnia – the story could be quite different.

According to the report, consumers in overlapping areas could see “reduced infrastructure-level competition, less aggressive pricing or promotional activity over time, lower pressure for network upgrades and service innovation, and reduced long-term competitive tension between independent fibre builders“.

On the other hand, the national impact of this may be limited. The overlap analysis indicates that fibre competition is highly concentrated geographically (particularly around the North West, Wales and parts of the Midlands), rather than evenly distributed nationally.

The North West alone accounts for approximately 40% of all high-competition overlap premises, with Wales representing the second-largest concentration. Major urban authorities, including Liverpool, Manchester, Birmingham and Belfast, contain particularly dense clusters of competing FTTP infrastructure.

In addition, of the 34,037 overbuilt postcodes, some 91.6% (766,554 premises) are classified as “high-competition” areas with 5+ fibre operators. “At first glance, this might suggest that consumers in these areas benefit from substantial infrastructure competition,” but Point Topic points out that, in practice, much of the underlying infrastructure competition in these areas may reduce to Openreach-based networks and Virgin Media/nexfibre/Netomnia infrastructure.

Point Topic Statement:

“The analysis highlights an important distinction between retail broadband choice and underlying network competition. Although many overlap areas appear highly competitive based on the number of consumer-facing broadband brands available, much of that retail competition is supported by the same underlying Openreach infrastructure.

At the same time, the data also reflects the broader structural challenges facing the UK fibre market. Many of the overlap areas are already highly saturated, with extensive infrastructure overbuild and limited remaining headroom for subscriber growth. Against that backdrop, the parties are likely to argue that consolidation may improve long-term network sustainability and strengthen competition against Openreach at a national scale.

Ultimately, the CMA’s assessment is likely to turn on whether fibre competition is viewed primarily through a national retail market lens or through a more granular local infrastructure framework. The regulator’s approach in this case may not only determine the outcome and timetable for the nexfibre/Substantial transaction, but also set an important precedent for how future Altnet consolidation is assessed across the UK broadband sector.”

At present the CMA are only in the evidence gathering stage, although it would not be surprising if they then proceeded to an initial Phase 1 review process. The real question is whether or not they then conclude that there is a need for a deeper Phase 2 investigation, which could push deal completion into 2027 and might potentially require VMO2/nexfibre to make some concessions.

Passing Phase 1 usually requires the CMA to conclude that there is no “realistic prospect” of a significant lessening of competition from the deal, which is a tougher standard to meet than the Phase 2 “balance of probabilities” test. However, given the CMA’s recent flexibility toward big telecoms mergers (e.g. Three UK and Vodafone) and the Government’s broadly favourable response to the deal, it’s not unreasonable to expect that they may ultimately allow the consolidation to go through.

Quite what form any concessions, if they do indeed materialise, may take is as yet unclear. But as we’ve said before, we would not be surprised if it included stronger wholesale requirements for Virgin Media’s consumer broadband network and nexfibre, which is something that those operators already seem to be preparing to try and deliver (here and here). Time will tell and at present there’s still a fair bit of uncertainty over the final outcome.