Mar 20, 2022

‘Altnets’ take on incumbents in fight for UK fibre broadband customers

CityFibre is one of dozens of so-called alternative network providers - or "Altnets" - that have taken advantage of the glacial pace at which BT, the one-time monopoly, was upgrading its network to rapidly dig up streets and lay fibre networks across the country. Over the past year, the battle between these challenger companies and the broadband incumbents has intensified as Openreach, BT's networking division, and Virgin Media O2 have responded to the threat by accelerating their full-fibre rollout. This hinges on their assessment of whether BT can use its market dominance to build over networks being laid by newer entrants - including CityFibre, Hyperoptic, Gigaclear and Community Fibre - and convince existing wholesale customers like Sky and TalkTalk to stick with them. Virgin Media O2 is upgrading its network to reach about 15.5mn premises by the end of 2028, and is seeking investors for a new venture to build a separate fibre network that will connect 7mn homes. "If you add up all of the fibre being built, we're going to be able to service the country three times over," said Dana Tobak, chief executive of Hyperoptic, an altnet that has laid fibre for 750,000 homes in some of the most densely populated cities in the UK and is backed by private equity group KKR. "Some will fail and some will make it. No one expects in the long term for there to be more than three or four networks, so it then just becomes who [fails] and when," she added.

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