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The scale of the UK’s commercial fibre rollout means some target areas no longer warrant government support
Today, fibre network operator CityFibre and Government’s Building Digital UK (BDUK) agency have agreed to ‘re-scope’ the nine contracts the operator holds as part of Project Gigabit.
The decision, the companies say, comes “in response to the accelerated rollout of commercially funded full fibre across Project Gigabit areas”, meaning government subsidies are no longer necessary.
Officially launched in 2021, Project Gigabit promised £5 billion in government subsidies to help fibre network operators reach some of the UK’s hardest-to-reach premises.
In 2023, CityFibre won ten Project Gigabit contracts with subsidies totalling around £782 million. This funding, CityFibre said, would help the company to reach 1.3 million homes and businesses across rural or hard-to-reach areas.
Work related to each of the contracts was reportedly underway by the start of last year, with CityFibre saying it had reached 150,000 premises in the covered areas, 70,000 of which had made use of subsidies.
Now, following analysis of information gained from BDUK’s ongoing Open Market Review process, the partners agree that the scope of the contracts is too broad for today’s market conditions. As a result, the revised targets will see CityFibre aim for 450,000 rural or hard-to-reach premises by 2030, with 226,000 of these directly subsidised by Project Gigabit.
In addition, a £58.6 million contract covering Nottinghamshire and West Lincolnshire will be ‘returned’ to BDUK.
“We are immensely proud of CityFibre’s involvement in Project Gigabit, an ambitious programme that has helped unlock the benefits of full fibre infrastructure for households and businesses previously at risk of being left behind. BDUK’s commitment has helped spur further investment and continued innovation and the time is right to focus on where we will have the biggest impact as we establish the competitive digital infrastructure market the UK deserves,” said Simon Holden, CityFibre’s Chief Executive Officer.
The government was quick to take credit for facilitating the rapid rollout of fibre across the UK.
“Over the past 18 months, this government has delivered upgrades to more than 229,000 hard-to-reach premises across the country. Our reforms to the telecoms market have unlocked a surge in commercial broadband rollout, meaning many areas previously in scope for CityFibre’s Project Gigabit contracts will now be upgraded without cost to taxpayers,” said Liz Lloyd, Telecoms Minister.
The announcement notes that this revision “will not affect BDUK’s ability to achieve the UK government target of 99% UK gigabit coverage by 2032”.
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