{"id":29105,"date":"2021-11-04T09:12:28","date_gmt":"2021-11-04T09:12:28","guid":{"rendered":"https:\/\/www.ispreview.co.uk\/?p=29105"},"modified":"2021-11-11T12:07:46","modified_gmt":"2021-11-11T12:07:46","slug":"cityfibre-plan-to-boost-uk-fttp-broadband-rollout-via-acquisitions","status":"publish","type":"post","link":"https:\/\/www.ispreview.co.uk\/index.php\/2021\/11\/cityfibre-plan-to-boost-uk-fttp-broadband-rollout-via-acquisitions.html","title":{"rendered":"CityFibre Plan to Boost UK FTTP Broadband Rollout via Acquisitions UPDATE"},"content":{"rendered":"

The CEO of CityFibre<\/a>, Greg Mesch, has revealed that the UK operator is already in “advanced conversations<\/em>” with rival alternative networks (AltNet), which could see them harness some of their multi-billion investment pot to help grow their gigabit-capable Fibre-to-the-Premises (FTTP<\/a>) broadband network coverage via acquisitions.<\/p>\n

At present the UK market is awash with around a hundred different and independent alternative networks (altnets) like B4RN<\/a>, CityFibre<\/a>, Gigaclear<\/a>, Hyperoptic<\/a>, CommunityFibre<\/a>, G.Network<\/a> and many more (Summary of UK Full Fibre Builds<\/strong><\/a>), all of which are busy attracting investment and trying to rollout their own FTTP<\/a> services.<\/p>\n

Some of those players, such as CityFibre<\/a>, have made a much more significant dent than others. Only yesterday, CityFibre reported that they had covered 1 million UK premises with FTTP<\/a> (here<\/a>) and were well on their way to their next goal of 8 million – across 285 cities, towns and villages – by the end of 2025 (here<\/a>). All of that is being backed by a \u00a34bn investment programme.<\/p>\n

However, the market may struggle to sustain so many AltNets, particularly with a good number of those smaller players opting to enter parts of already highly competitive cities and towns. Previous studies (FTIR<\/a>) have suggested that dense urban areas may be able to sustain 3-4 gigabit-capable broadband networks. But in some areas that model is already being stretched, and it becomes less realistic when looking at smaller towns and villages (we’re starting to see multiple AltNets fighting over some of those too).<\/p>\n

On top of that AltNets are facing competitive pressures from other changes, such as Virgin Media<\/a>’s (VMO2) still tentative plan to launch a wholesale product and expand their FTTP coverage. Not to mention Openreach<\/a>’s (BT<\/a>) massive FTTP rollout and their new discount scheme for ISPs. The market’s two biggest players are clearly fighting back to retain their positions, but despite the increasing risk for AltNets, investors have so far been happy to continue throwing billions of pounds at such projects.<\/p>\n

Nevertheless, we’ve long predicted that such a market would produce both winners and losers. Typically, larger projects with the strongest backing and plenty of fibre in the ground (e.g. CityFibre), and smaller projects with a highly established base and \/ or well protected model (e.g. B4RN<\/a>), may be better able to weather the coming storm. But the inevitable expectation in such a market tends to be one of consolidation.<\/p>\n

“We are more active on the consolidation level than people may appreciate<\/em>,” said Greg Mesch, CityFibre’s CEO to The Times<\/a> (paywall). The operator is currently in “advanced<\/em>” talks with other AltNets that have a “compatible footprint with ours<\/em>,” which Greg views as a way to increase their coverage, while at the same time fighting back against VMO2 and BT<\/a>.<\/p>\n

One obvious challenge on this front is that most of the other AltNets in this space have only recently begun to build at any kind of scale, and many of them have yet to create a respectably large footprint. From a value and asset perspective, the only fibre that matters is the fibre in the ground, and not so much the fibre committed through a press release.<\/p>\n

In addition, due to the long-term investment commitments that exist alongside many such providers, quite a few of them may have an inflated opinion of their own value – before they’ve actually built enough fibre to justify it. Such things can create problems when trying to strike consolidation deals. Suffice to say, we weren’t expecting too much consolidation for another 1-2 years, but as above – that may be about to change.<\/p>\n

On top of that, FTTP networks are not all created equal. There can be significant differences in terms of network setup and hardware choice, which can add a lot of extra cost when attempting to integrate different platforms. CityFibre saw something similar when they spent \u00a3206m to acquire the FibreNation<\/strong> project from TalkTalk<\/a>, and ended up needing to upgrade quite a bit of kit (here<\/a>).<\/p>\n

However, CityFibre are quite well positioned to capitalise on some of the more successful AltNet builds. We suspect they’ll focus on those that have a rapid pace of build and are deploying in areas where they have limited or no pre-existing coverage. On that front, Hyperoptic<\/a>, G.Network<\/a>, CommunityFibre<\/a>, KCOM<\/a>, Gigaclear<\/a>, Fibrus<\/a>, Trooli<\/a> and WightFibre<\/a> seem like potential targets. But some of those may not want to sell. Others like VXFIBER (LilaConnect) and FullFibre Limited may also carry some interest.<\/p>\n

UPDATE 11th Nov 2021<\/strong><\/p>\n

Reports indicate that CityFibre are in discussions with rival altnet toob<\/a>, which has nearly completed its own FTTP network across Southampton and is busy building in various other towns.<\/p>\n","protected":false},"excerpt":{"rendered":"

The CEO of CityFibre, Greg Mesch, has revealed that the UK operator is already in “advanced conversations” with rival alternative networks (AltNet), which could see them harness some of their multi-billion investment pot to help grow their gigabit-capable Fibre-to-the-Premises (FTTP) broadband network coverage via acquisitions.<\/p>\n","protected":false},"author":1,"featured_media":29106,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0,"footnotes":""},"categories":[1],"tags":[472,418,56],"class_list":["post-29105","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uk_isp_news","tag-business","tag-cityfibre","tag-fttp"],"share_on_mastodon":{"url":"","error":""},"yoast_head":"\nCityFibre Plan to Boost UK FTTP Broadband Rollout via Acquisitions UPDATE - ISPreview UK<\/title>\n<meta name=\"description\" content=\"The CEO of CityFibre, Greg Mesch, has revealed that the UK operator is already in "advanced conversations" with rival alternative networks (AltNet), which\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.ispreview.co.uk\/index.php\/2021\/11\/cityfibre-plan-to-boost-uk-fttp-broadband-rollout-via-acquisitions.html\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"CityFibre Plan to Boost UK FTTP Broadband Rollout via Acquisitions UPDATE - 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