• New Point Topic report shows FTTP coverage now reaches nearly 80% of all UK premises
• Overbuilding means almost a third of UK households now have at least two fibres passing their front door while some have as many as four – too many?
• But overbuilding is now slowing as further altnet consolidation looms
• Focus for UK altnets continues to shift from network building to commercialisation and revenue generation

Ten years ago, fibre-to-the-premises (FTTP) was a rarity in the UK and only BT and Virgin Media were talking of meaningful future investments for the mass market. Fast forward to 2025 and things are very different: Changes in regulations, billions of pounds of investments and the launch of scores of altnets means that, as of the end of June this year, 77.8% of UK premises, equivalent to about 26.1 million homes and businesses, had access to at least one fibre broadband connection (up from 75.8% at the end of Q1), according to broadband market intelligence and analysis outfit, Point Topic, which boasts a dataset that covers all 1.7 million UK postcodes. 

Not only is a fibre broadband service readily available to a majority of the UK’s 30 million-plus premises, an increasing number are passed by more than one fibre line, thanks in part to the network rollouts undertaken by the altnets, the independent network operators that have raised capital and invested in their own fibre access network infrastructure to compete with the UK’s incumbent fixed broadband operators, BT’s quasi-independent wholesale fixed access network division, Openreach, and Virgin Media O2 (VMO2). 

According to Point Topic’s recent UK broadband availability report, 10.9 million UK premises had access to two or more FTTP networks – that’s 32.6% of the total – while just over 1.75 million premises (5.2% of the total) were covered by three or more fibre networks. A small number, just over 149,000, have the dizzying choice of four or more fibre networks. 

That’s something of an embarrassment of riches and the number is likely to rise as network construction continues apace by at least some of the major players. For example, during the course of the second quarter of this year, Point Topic calculated that Openreach passed a further 982,500 premises with its fibre access lines to reach a total of 18.7 million UK premises: Openreach full fibre now covers 55.6% of all UK premises, up from 52.7% at the end of March this year. 

Due to the pace of fibre access network deployments in recent years, the number of UK premises now reached only by ‘legacy’ broadband technologies, is falling quickly. In the case of Openreach’s coverage, the number of UK premises reached only by its non-full fibre broadband infrastructure – ADSL, fibre-to-the-cabinet/curb and Gfast, all of which reach the premises with a copper line – now stands at 14.3 million UK premises and that number is falling (by 977,000 in the second quarter of this year).  

The altnet conundrum

Altnets have had a major impact on the UK fixed broadband sector. While CityFibre, the biggest and best known of the competitive fibre access infrastructure players, has been around since 2011, many of the smaller and often more local FTTP altnets emerged in 2018 or later, and since 2020 they have invested more than £5bn in the UK’s FTTP infrastructure.   

However, as has been evident for a while now, the industry finds itself in a bind of its own making. As a deliberate competitive strategy, fibre overbuilding has been rife, with multiple companies installing networks in the same geographical areas – an expensive and environmentally disruptive process that cannot be sustained in the long term. 

And while the altnets have helped to introduce greater competition into the market – collectively their fibre infrastructure reaches more than 13.6 million UK premises, according to Point Topic – some are finding they cannot generate the levels of revenue necessary to ensure their long-term survival in a cut-throat sector. 

Meanwhile, new investments in the altnet sector are becoming rarer and sector consolidation is increasing, a trend that seems likely to continue. Furthermore, the UK’s telecom regulator, Ofcom, has said it might intervene to prevent any further overbuild and ensure a long-term, sustainable rollout of fibre-to-the-home (FTTH). 

Point Topic reports that among the altnets known to have passed more than 100,000 premises, CityFibre, which recently secured £2.3bn in new funding, is the largest, having passed 4.1 million premises with its network. 

Netomnia (including Brsk, with which it merged last year and is in the process of integrating), Nexfibre (a joint venture between Infravia Capital Partners and VMO2’s parent companies, Liberty Global and Telefónica), and Community Fibre are the next largest of the altnets, with 2.5 million, 1.8 million and 1.4 million premises passed, respectively. 

The report also reveals that, quarter on quarter, the FTTP footprint of altnets Quickline, Brsk and LightSpeed, all of which have passed in excess of 100,000 premises, achieved respective percentage growth rates of 25.3%, 13.3% and 12.8%.

One thing is for sure, if they are to survive, altnets will have to continue to innovate and to collaborate, probably form partnerships with others and immediately prioritise the commercialisation of their networks and increase revenues while back-pedalling on plans for further FTTP deployment. Even so, quite brutal consolidation seems likely as bigger altnets with more money seek to snap up the distressed assets of their smaller rivals and grow their networks inorganically: Cityfibre noted recently when it secured its new funding that, having already pulled the merger and acquisition (M&A) trigger this year, it will be snapping up more smaller players to expand the reach of its network.

In March, CityFibre announced the acquisition, for an undisclosed sum, of network infrastructure assets from Connexin, which expanded CityFibre’s potential footprint by 185,000 premises in the city of Hull and surrounding East Riding area of Yorkshire – see CityFibre kickstarts M&A-fuelled growth spurt.

The Point Topic team expects “overbuild to slow down further as market consolidation increases.”

It is entirely possible, as some industry analysts believe, that the number of altnets in the UK will fall from more than 100 down to somewhere between 10 and 20 significant players of sufficient size to be able to compete effectively. Such a scenario may not happen overnight but change is in the air. 

– Martyn Warwick, Editor in Chief, TelecomTV