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Major players ‘less than impressive’ as altnets rise in UK broadband
A range of surveys identify independent sector as the driving force in UK’s growing gigabit broadband industry and caution of slowdown in subscribers by major providers
The UK’s broadband sector has been a success story over the past five years, with an acceleration of gigabit access, but studies from Point Topic and thinkbroadband.com have pointed to a growth slowdown among the major suppliers and increased importance of the nation’s independent broadband providers (altnets).
In its UK ISP and network supplier metrics report for the second quarter of 2024, Point Topic concluded that altnets subscriber numbers were still stable as those for major broadband players were “less than impressive”.
The quarterly update on the fixed broadband market looked at retail ISPs and network suppliers throughout the UK. In addition to the incumbent operators and infrastructure builders, Point Topic tracked 106 altnets ranging from micro/local ISPs to larger providers with national coverage.
The data showed that total Q2 2024 fibre-to-the-home/premises/business (FTTH/P/B), fibre-to-the-cabinet (FTTC), cable, fixed wireless access (FWA)/satellite and DSL wholesale and retail connections saw a very slight increase during the quarter, standing at an estimated 28.92 million, inching up from 28.90 million in the previous quarter and comparing with 28.82 million in the same quarter a year ago.
The study also confirmed that the stall in the fixed broadband retail market remained, with around 21,000 net broadband subscriber additions compared with approximately 38,000 net additions in Q1 and 65,000 in the previous year.
In terms of the companies defining the market, UK broadband market leader Openreach reached its FTTP roll out target of just more than one million premises passed during the quarter, and it is on track to reach its build target of 25 million premises by the end of 2026. The company’s average build rate reached 78,000 premises per week, with a footprint of 14.82 million premises.
The data showed that while VMO2’s full-fibre footprint reached the milestone of five million premises, up 68% year on year, its broadband customer base decreased to 5.70 million. In addition, overall in-footprint penetration dropped to 32.6%, down from 33.3% compared with Openreach’s 34%.
In all, the UK’s altnets recorded around 59,000 net additions down from around 70,000 in the previous quarter. Altnets’ total consumer broadband base reached just over 2.06 million, up from 2.0 million in Q1 2024 and 32% (1.56 million) in Q2 2023.
Looking at major ISPs, Vodafone was found to have had the strongest quarter, with circa 44,000 broadband net additions, but others struggled and saw modest losses. Sky chalked up an estimated 4,000 losses; Virgin Media O2 (VMO2) reported 12,000 losses; followed by TalkTalk’s 30,000. The analyst noted the latter’s losses appeared as it continued to restructure, find cost efficiencies and deal with its debt-laden Platform X wholesale division.
Meanwhile, among the topline findings of thinkbroadband.com’s State of broadband report for Q3 2024 was that altnets were playing a crucial role in the UK’s broadband delivery and challenging the incumbent operators such as Openreach and VMO2.
The study stressed that altnets play a vital role where incumbent services from BT Openreach and Virgin Media are not available, and they can often be superior both in terms of price and service speed, becoming an essential part of the UK’s broadband infrastructure and providing a critical lifeline for local communities desperate for fast broadband.
Overall, the study calculated full-fibre was now available to almost 7 in 10 UK households – up from six in 10 six months ago – with Openreach leading the way at 46% (up from 39%) and gigabit being available to 83.9% of households, up from 79.9%. Altnets were available to almost 4 in 10 premises (35.9%).
The survey added that the announced merger between YouFibre and Brsk saw the combined altnet jumping above Community Fibre and to just after nexfibre. It also found that CityFibre now covers 10% of UK premises, accounting for 3.8 million households, and CommunityFibre covers 5%, representing 1.5 million households.
Read more about UK broadband
- Openreach to light up 312,000 rural UK premises in Project Gigabit next phase: UK’s leading broadband provider engaged in latest step of £5bn gigabit access programme to improve broadband for more than 300,000 homes and business across UK.
- Poor connectivity holding back rural Britain: Research from leading UK operator warns the nation is sleepwalking into a countryside crisis, with 4.6 million rural residents considering moving to a town or city in the next 12 months.
- UK altnets’ fibre optic overbuild risking rural connectivity: Report suggests UK’s independent broadband providers are at risk of more unnecessary overbuild as new entrants rush to deploy infrastructure without considering the long-term sustainability of their business models.
- UK broadband altnets unite to push for fairer access regulation, pricing: Five of the UK’s largest alternative fibre network operators have come together to create an alliance and call on UK comms regulator to ensure fair and equal access for all users of nation’s physical infrastructure.