The new joint venture (JV) would seek to cover an additional 7 million premises with fibre-to-the-premises (FTTP) in areas beyond Virgin Media O2 (VMO2)’s current footprint
Last week, rumours were emerging suggesting that the owners of VMO2 – Liberty Global and Telefonica – had entered into discussions with investors for the creation of a new JV to help accelerate the rollout of FTTP in the UK.
At the time, sources were suggesting that VMO2 would be looking to raise as much as £1 billion to help launch the new business, which would target areas VMO2’s FTTP network currently is not set to reach.
Now, alongside announcing their financial results, VMO2 have confirmed that they are indeed in discussions with a number of potential investors to take part in a JV. This JV will aim to build a new FTTP network covering roughly 7 million premises by 2027, which will then be offered on a wholesale basis to UK operators. VMO2, naturally, will be an anchor tenant of the new network.
Ultimately, seeking partners for additional network investment should come as little surprise, with VMO2 having said last year that it would prefer not to fund the rollout of FTTP to another 7 million on its own. In the past few years we have seen numerous rumours related to UK ISPs that could potentially have joined forces with Virgin Media to facilitate this joint build, though until now they have never been confirmed.
If all goes to plan, once completed this new network will expand VMO2’s total gigabit reach to roughly 23 million premises, presenting a serious challenge to UK incumbent Openreach.
However, its rollout still has a long way to go.
VMO2 currently has around 1.2 million premises with FTTP and is aiming to increase that figure to 7 million by 2027. The company said today that they expect to add roughly 500,000 new premises to the FTTP network in 2022, though this pace will need to be accelerated if they hope to reach their 7 million target.
BT, meanwhile, already has roughly 6 million premises covered by FTTP and is planning to spend £15 billion to increase this total to 25 million premises by 2025.
For the time being, however, VMO2 can claim to be ‘the country’s largest gigabit provider’, having announced back in December last year that they had fully completed their network upgrade to DOCSIS 3.1 technology, allowing their full 15.5 million covered premises to access gigabit-capable broadband.
What impact would the creation of new major fibre wholesaler have on the UK broadband market? Find out from the experts at this year’s Connected Britain conference
Also in the news:
Tech sovereignty debate takes the to the stars with €6bn EU satellite plan
CityFibre and BAI team up for private 5G in Sunderland
IBM spin off Kyndryl partners with Nokia to target enterprise market