{"id":34496,"date":"2024-04-23T17:34:27","date_gmt":"2024-04-23T16:34:27","guid":{"rendered":"https:\/\/www.ispreview.co.uk\/?p=34496"},"modified":"2024-04-23T17:35:17","modified_gmt":"2024-04-23T16:35:17","slug":"alternative-full-fibre-networks-grow-to-cover-12-9-million-uk-premises","status":"publish","type":"post","link":"https:\/\/www.ispreview.co.uk\/index.php\/2024\/04\/alternative-full-fibre-networks-grow-to-cover-12-9-million-uk-premises.html","title":{"rendered":"Alternative Full Fibre Networks Grow to Cover 12.9 Million UK Premises"},"content":{"rendered":"

The Independent Networks Co-operative Association<\/a> (INCA) and Point Topic<\/a> have released their 2024 report into the impact of alternative “full fibre<\/em>” (FTTP<\/a>\/B) gigabit broadband networks (AltNets), which reveals that their UK coverage grew by 57% in 2023 to top 12.9 million premises (up from 49% and 8.22m in 2022) and could reach 16.7m in 2024.
\n<\/p>\n

The coverage figures above are lower than in other reports (e.g. Ofcom’s Connected Nations 2023<\/a>) because INCA’s study excludes Fibre-to-the-Premises<\/strong> (FTTP<\/a>) deployments from the two largest operators – Openreach<\/a> (BT<\/a>) and Virgin Media<\/a> (VMO2) – in order to focus on independent AltNets like CityFibre<\/a>, Netomnia<\/a>, Gigaclear<\/a>, Hyperoptic<\/a>, CommunityFibre<\/a> and many more (Summary of UK Full Fibre Builds<\/strong><\/a>).<\/p>\n

NOTE:<\/strong> Openreach<\/a> covers 14m premises with FTTP<\/a>, while KCOM<\/a> has 300,000+, and we don\u2019t have an exact figure for Virgin Media<\/a> \/ nexfibre<\/a> (likely around 4m). All are extending.<\/div>\n

The new report<\/strong><\/a> finds that FTTP from AltNets now covers a total of 12.9m premises (ready for service), which they say is approximately 35% of all UK premises. Furthermore, some 3m of those were in places classed by Ofcom<\/a> as \u201cArea 3<\/em>\u201d (i.e. mostly harder to reach rural locations). Take-up also stands at 15% (2 million live connections), which is up from 1.5 million in the last year’s report, but the portion is down from 20% – this is somewhat expected, given the rapid pace of build.<\/p>\n

However, it\u2019s worth remembering that past reports also included a future forecast, which last year predicted that AltNets would be delivering coverage to 14.23m premises by the end of 2023. But today’s figure of 12.9m for that period falls a fair bit short of this target, which is sadly to be expected given how many network operators cut jobs and suffered a build slowdown during the latter half of 2023.<\/p>\n

The latest forecast is for altnets to extend their coverage to reach 16.7m premises by the end of 2024, but we’re expecting 2024 to be another rocky year for a lot of operators and as such this figure should be taken with caution. Separately, it’s worth noting that, when overbuild is excluded, the new data means that 6.9 million premises “are only passed by Altnet fibre<\/em>” (no Openreach<\/a> or VM).<\/p>\n

Build progress is overall positive, but the above clearly reflects the challenges that AltNets have faced in converting their build ambitions into reality in the current market. At this point everybody has felt some strain due to a combination of issues, such as rising costs (build, leases etc.), competition from rivals (e.g. overbuild, price discounts), the challenge of growing a viable level of take-up and the difficulty of securing fresh investment while interest rates remain high.<\/p>\n

\"inca-2024-gigabit-and-fttp-altnet-uk-coverage\"<\/p>\n

One possible caveat above is that there can be a tendency for some network operators to report technically unfinished or non-live builds (i.e. you can\u2019t yet order a live service) as Ready for Service<\/strong> (RFS), which may cause complications when forecasting live coverage.<\/p>\n

The Financial Impacts<\/strong><\/span><\/h3>\n

According to INCA, investment and expenditure in the Altnet sector continued throughout 2023 with an estimated additional \u00a37 billion having been committed to network expansions and operations during the year. INCA estimates that AltNets currently have an intended capital expenditure (CAPEX) – from 2024 until the end of 2028 – of over \u00a313.4 billion, with operational expenditure of at least \u00a31bn.<\/p>\n

However, we should point out that aspirational funding commitments are subject to significant change, much like the builds themselves, and so should be taken with a pinch of salt. Some projects will fail or reduce, so we don’t expect all of this to be realised. In fact, 2023 was a good example of this, with quite a few operators putting a slowdown or pause on their build progress due to the wider economic pressures (accurately accounting for this is extremely difficult due to the lack of transparency from many operators).<\/p>\n

However, taking this private sector investment together with the government\u2019s \u00a35 billion Project Gigabit commitment, as well as other planned full fibre investments (e.g. \u00a34.5bn on VMO2\u2019s Nexfibre<\/a> project and \u00a315bn on Openreach), quickly highlights just how much inward investment is still involved in the market. The vast majority of that is private funding, which is naturally taking a lot of the strain away from the public purse.<\/p>\n

\"INCA-UK-Altnet-Investment-Forecast-2024\"<\/p>\n

Finally, in terms of the issues that AltNets think are the most pressing to tackle, it’s worth looking back at last year’s report to see what the top concerns were during 2022. According to last year’s report, the top concerns were – 1) Planning and street works delays and\/or costs, 2) Project Gigabit procurements, the tendering process, and threat of overbuild, and finally, 3) Overbuild by providers other than Openreach.<\/p>\n

By comparison, the top concerns in this year’s (2023) report were – 1) Access to finance, 2) Switching between Openreach and independent networks e.g. through the One Touch Switching process, and, 3) Getting wayleaves. All of that makes perfect sense, given what has been said above and the many related developments seen during the year.<\/p>\n

\"INCA-Top-UK-Altnet-Concerns-for-2024\"<\/p>\n

Overall, altnets continue to have a significant impact across the United Kingdom and that is set to continue for the foreseeable future, which is one of the reasons why major network operators are ramping-up their own builds (competition). But at the same time, we do expect to see a continuing level of consolidation on the market, particularly now that CityFibre<\/a> and others seem to be going on the hunt.<\/p>\n

Tim Stranack, INCA Chair, said:<\/strong><\/p>\n

“Even though INCA anticipates that Altnet network build will slow in 2024 it should still be possible to achieve the Government\u2019s target of 85% Gigabit enabled properties by the end of 2025. The target of 99% properties Gigabit enabled by 2030 will be dependent on how successful Ofcom<\/a>\u2019s forthcoming Telecommunications Access Review is at reassuring and incentivising private investors to continue building the UK\u2019s remaining full fibre network.<\/p>\n

By the time of next year\u2019s report we will have a new Government and Ofcom<\/a>\u2019s first market review consultation. Support from both parties will be needed if the UK\u2019s vision of established and sustainable telecommunications competition which elevates the UK to the forefront of technological innovation is to be realised.”<\/p><\/blockquote>\n

Finally, the report includes its usual brief mention of Fixed Wireless Access (FWA) providers, which in the small print are estimated to cover more than 2 million premises, although not all will have a full speed service available. The fixed wireless access (FWA) market is more difficult to assess due to line-of-sight issues and fragmented supply in the sector.<\/p>\n","protected":false},"excerpt":{"rendered":"

The Independent Networks Co-operative Association (INCA) and Point Topic have released their 2024 report into the impact of alternative “full fibre” (FTTP\/B) gigabit broadband networks (AltNets), which reveals that their UK coverage grew by 57% in 2023 to top 12.9 million premises (up from 49% and 8.22m in 2022) and could reach 16.7m in 2024.<\/p>\n","protected":false},"author":1,"featured_media":29256,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"ngg_post_thumbnail":0,"footnotes":""},"categories":[1,1645],"tags":[423,65,56,39,38,34,476],"class_list":["post-34496","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uk_isp_news","category-key_uk_isp_industry_developments","tag-fttb","tag-ftth","tag-fttp","tag-point-topic","tag-politics","tag-statistics","tag-wifi"],"share_on_mastodon":{"url":"https:\/\/mastodon.social\/@ispreview\/112321506562174149","error":""},"yoast_head":"\nAlternative Full Fibre Networks Grow to Cover 12.9 Million UK Premises - 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