Research Roundup July 2022
Updated: Aug 3
Global Broadband Subscribers Q1 22, European Broadband Mapping, Open Networks R&D Fund, plus ISP, government, and Ofcom updates
Point Topic’s July publications featured the release of our statistical analyses of Global Broadband Subscribers Q1 2022. Point Topic also released our European broadband mapping coverage for both Greece and Sweden, with both countries outperforming the national EU average on both the national and rural levels in terms of fixed broadband coverage.
On 13 June, DCMS released its UK Digital Strategy which outlines a new single vision to grow the digital economy whilst addressing tech sector skills, investment, and infrastructure. Supporting the expansion of the digital economy, the government reports, could grow the UK tech sector’s annual GVA by an additional £41.5bn by 2025, and create a further 678,000 jobs. On 4 July, DCMS updated the Digital Strategy to include an infographic on visa routes for digital employers which helps to explain the information on visa routes related to digital skills discussed in section 3.6 (digital skills and talent). Securing and retaining skilled workers from the UK, EU, and overseas countries remains an area of very significant concern for UK broadband suppliers. However, the guidance produced by DCMS only provides clarification of visa routes as opposed to offering an easing in legislation for the free movement of international digital workers.
On 19 July, Simon Blagden CBE was announced as the new Chair of Building Digital UK. Simon has 30 years’ experience in the IT, telecoms and digital industry. For 14 years he was non-executive Chairman at Fujitsu Telecommunications UK. The role will last for four years.
On 26 July, DCMS announced its Future Open Networks Research Challenge which will see universities and telecoms firms being able to apply for up to £25m to research and develop the next generation of 5G and 6G network equipment as part of new government plans to unleash innovation in the sector. The Government is accelerating the development of Open Radio Access Network (Open RAN) technology - which allows operators to mix and match equipment rather than relying on a single supplier when building or maintaining networks - as part of its £250 million Open Networks R&D Fund. It aims to build more secure and resilient broadband and mobile infrastructure by boosting competition and innovation within the telecoms supply chain.
This collaboration, together with other steps that the Government is taking through its Diversification Strategy, aims to meet the Government and UK mobile network operators’ joint ambition to carry 35% of the UK’s mobile network traffic over open and interoperable RAN architectures by 2030. The Government will invest through a series of competitions and challenges with funding made available until the end of March 2025. These activities will encourage greater collaboration towards addressing key barriers including power efficiency, spectrum management, software platforms, systems integration and security - ensuring that the development of innovative telecoms solutions meet the performance and security requirements of mobile network operators and other network builders.
Ofcom produced several key telecoms sector data analyses throughout July. On 13 July, the regulator published data on Q1 2022 Telecoms and pay TV complaints, followed by on 18 July with the Telecoms data (within the Communications Market Report 2022). On 28 July Ofcom released its Telecommunications Market Data Update Q1 2022, which outlined telecommunications data revenues, volumes and market share for the first quarter.
Key telecoms findings within Ofcom’s Communication Market Report 2022, included:
The UK telecoms sector generated £31.1bn in revenue in 2021, a 4% decline year-on-year.
There were 27.7 million UK fixed broadband connections at the end of 2021, a 1% increase year-on-year.
Two-thirds (67%) of broadband connections were provided using fibre technologies at the end of 2021; 60% being FTTC, with full fibre accounting for 7% of all connections, a 50% increase year-on-year.
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In Q1 2022, the quarterly fixed broadband subscriber growth rate stood at 1.7 per cent, with the number of connections reaching 1.3 bn. Similarly to Q4 2021, the growth rate was slightly lower than in the respective quarter a year ago.
Fixed broadband subscriber numbers grew in 90 per cent of the 131 countries covered in this report.
The share of FTTH in the total fixed broadband subscriptions continued to increase and stood at 58 per cent. Superfast and ultrafast cable broadband connections followed with an 17 per cent share. Connections over all other technologies lost market shares to fibre.
Between Q1 2022 and Q4 2021, the number of copper lines fell by 9.8 per cent, while FTTH connections increased by 13.5 per cent.
China added 14 million, Brazil 1.1 million and France a million fibre broadband subscriptions.
The largest broadband market of East Asia has recovered its share of net additions to fixed broadband subscribers – it stood at 71 per cent compared to 52 per cent in the previous quarter (Figure 1). With China dominating East Asia in terms of the market size, this regional recovery was mainly due to much higher broadband subscriber net adds in the country in Q1 2022 compared to Q4 2021. As a result, the share of adds in Asia – Other has dropped from 25 per cent to 11 per cent quarter-on-quarter. In Q1 2022, we recorded negative net adds in Eastern Europe due to the significant quarterly fall in fixed broadband subscribers in Ukraine.
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Other key players announcements along with the month’s news round-up can be found below.
BT Group released its Q2 2022 key performance and financial results on 28 July. The incumbent’s Consumer division closed out the quarter with 1.283m FTTP subscribers, up from 1.165m in the previous. Openreach’s fibre build and connection continues at pace, with another record quarterly FTTP rollout of 763k, bringing the total to 7.957m premises passed. The second quarter also saw 302k subscriber net adds bringing the total to 2.073m up from 1.771m in the previous quarter.
VMO2 also released their Q2 results in late July with a stronger overall performance since the previous quarter. The quarter saw some fixed line broadband growth for the operator with 16k net additions versus a loss of 1k in Q1 2022. Their total fixed line broadband subscriber base reached 5.612m up from 5.595m in the previous. Its Project Lightning build passed 114k premises up from 101k. Their total Lightning build has now passed around 2.9m premises with around 1.6m being FTTP and the remainder using Hybrid Fibre Coax technology. VMO2 have reported that they are on track to reach a further 500k Lightning premises in 2022.
Various news resources reported on 15 July that VMO2 were allegedly eyeing up a £3bn take-over bid of TalkTalk. The news comes a few months after it was reported that TalkTalk had been tentatively approached by rivals, Vodafone and Sky. The take-over if successful, would see VMO2 acquiring TalkTalk’s 4.2m subscriber base which would put it on more equal footing with BT’s c. 9m subscribers. However, one downside would be for CityFibre who relies quite heavily on TalkTalk as resellers of its full fibre gigabit-capable products. CityFibre’s ISP base has gone from strength to strength however, with Vodafone, Zen Internet and Giganet offering the its services across its nationwide network.
On 29 July, VMO2’s parent companies, Liberty Global and Telefónica, alongside investment firm, InfraVia Capital Partners, announced a £4.5bn investment with the creation of a new fibre joint venture. Up to 7 million premises will be passed with a new wholesale full fibre network. The partnership will initially roll out fibre to 5 million homes not currently served by Virgin Media O2’s network by 2026, with the opportunity to expand to an additional ~2 million homes. VMO2 will commit to being a wholesale customer of the new network, which will extend its total fibre footprint up to 23 million premises.
CityFibre (CF) has continued its full fibre network rollout throughout the month at pace following the 2 June announcement that it had secured a £4.9bn debt package comprising committed facilities of £3.9bn and an accordion facility of £1bn. On 25 July, CF announced that it will be deploying 10Gbps XGS-PON access technology as standard across its networks from April 2023 in partnership with Calix and Nokia. The first XGS-PON customer connections are already live in York, where it upgraded its existing network as part of a project piloting the technology.
BT Group News
1 July – BT teams up with the Federation of Small Businesses (FSB) with launch of new partnership network for small firms (0-5 employees), with benefits including FSB members get up to £250 towards running social media and digital advertising campaigns through BT’s new Digital Marketing Hub, along with BT customers benefit from 15 per cent discount on FSB membership.
6 July – Openreach announced its plan to allow SOGEA 0.5 Mbps orders at premises where FTTP is available and where FTTP Priority Stop Sell exchange rules apply.
6 July – Openreach announced 100,000 homes and businesses in the North of Tyne can access full fibre broadband
12 July – Openreach announced only a 22% uptake in full fibre services in Doncaster, South Yorkshire where they have passed 57k premises with their FTTP network.
13 July – BT adds 2,800 roles to Digital workforce to accelerate innovation and transformation plans.
13 July – Openreach announced that more than 100k premises in Nottinghamshire have been passed by their FTTP network, however there has only been a 12% uptake in the service.
19 July – Openreach announced a £13.5m investment plan for its FTTP network rollout to 45k premises in the Isle of Wight.
21 July – Openreach announced product stop sell to be activated in the Tranche 9 FTTP priority exchanges locations bringing the total of notified exchanges to 651 including the Salisbury trial site.
21 July – Openreach published its notification of Tranche 5, 6, 7 FTTP priority exchanges, stop sell implementation 02 August 2022; A realignment of 30 notified exchanges, the briefing provides an update for Tranche 5 and informs all CPs of the realignment of 73 exchanges from Tranches 6, 7, 8 and TBD.
22 July – BT Group and Warner Bros. Discovery welcome CMA’s approval of the BT Sport and Eurosport UK Joint Venture
26 July – BT provided an update on its ‘Network Vision’ one year on; By 2023, new smart core technology powering their network, by 2025, 4,500 square miles of new rural mobile coverage, and by 2028, a 5G connection possible anywhere in the UK.
Virgin Media O2 (VM02) News
4 July – Virgin Media O2 Business switches on the UK’s first 5G-connected hospital with South London and Maudsley NHS Foundation Trust.
8 July – VMO2 announced it has reached an agreement with BAI Communications which will allow customers to access high-speed 4G and 5G-ready mobile connectivity across the Tube, including within the tunnels.
21 July - Virgin Media O2 boosts list of data-free services as part of measures to support customers in cost of living crisis.
26 July – Virgin Media O2 increases free data gifting to over 61 million GB amid escalating cost of living crisis.
CityFibre (CF) News
11 July – CF announced that it is piloting Telco Systems’ ‘Edgility Suite’ for rapid, cost-effective delivery of value-add services for Business ISPs.
15 July – CityFibre responds to ruling from the Competition Appeal Tribunal (CAT); CAT has dismissed the Appeal regarding Ofcom’s consultation procedures regarding Openreach’s Equinox offer, however the Tribunal was critical of Ofcom for its failure to provide clear and consistent guidance to those making very significant investment commitments on the basis of Ofcom’s policy decisions.
Independent Operators (AltNets) News
1 July – Netomnia announced further rollout locations throughout the month, including Bedford, Coatbridge, Grantham, Irvine, Mansfield, and Purfleet.
1 July – Zzoom published its annual report and has revealed that it passed 50k premises up from 10k in December 2021 and has around 3k subscribers, up from 1,400 at the close of Q4 2021.
2 July – Swish Fibre add two new rollout locations including Midhurst (West Sussex) and Alresford (Hampshire)
2 July – ITS Group’s joint venture with the City of Liverpool has connected the first 150 businesses as part of its 212km city-wide Ethernet network called LCR Connect which began in 2021; the network connects into three transatlantic cables and major economic clusters in each of the Liverpool City Region’s six local authority areas (Halton, Knowsley, Liverpool, St Helens, Sefton and Wirral), the build is expected to complete by the end of 2023.
5 July – Isle of Wight-based WightFibre announced it has passed the 40k premises passed milestone, the provider aims to pass 73k premises with its full fibre network by 2023.
5 July – F&W Networks announced that it has secured £25m in funding from Santander to continue its rollout across South East England.
8 July – Connect Fibre announced that it has launched its full fibre gigabit-capable service in Edinstowe in Nottinghamshire.
8 July – Andrews and Arnold retail ISP announced it will be offering 1 Gbps services via CityFibre’s network from early autumn 2022.
8 July – Lothian Broadband announced plans to further expand its reach and investment within East Lothian and Midlothian by adding Gullane, East Linton and Pathhead to its XGS-PON network rollout plan for 2022. Gullane will be the next location with work on the 1,600-premise build starting in July.
11 July – Hull-based ISP, Connexin, announced the acquisition of fellow Hull-based rival, Wisper Broadband, which will see Connexin adding ‘thousands’ of customers to its portfolio.
11 July – IDNet announced it will be offering FullFibre Ltd’s network services, which is in addition to IDNet’s connection services via both Openreach and CityFibre’s networks.
13 July – YouFibre announced it had connected its first customer in Tewkesbury, Gloucestershire just 22 days after its build partner, Netomnia began rollout in the area.
13 July – Glide Group announced announced that it has acquired 100% of the shares of Velocity1 Ltd from Quintain. Alongside the acquisition, Quintain and Glide have agreed on a strategic partnership under which Glide will operate Quintain’s wholly-owned fibre optic network throughout Wembley Park, which it has been building out since 2008, and provide broadband services to the 85-acre estate.
14 July – Gigaclear awarded Openreach’s national Path to Collaboration status which will enable the former to streamline its network rollout when utilising the latters Physical Infrastructure Access (PIA) products.
15 July – Hyperoptic hit a triple-figure milestone by connecting over 100k new build homes to its full fibre network and has agreements in place to connect a further 100k new build properties over the next twelve months.
18 July – FactCo completed biggest Gigabit Voucher Scheme buildout in Cambois, Northumberland, connecting more than 100 premises.
21 July – Freedom Fibre announce further full fibre network rollout expansion plans to Northwich, Comberbach and Hartford, extending their coverage of Cheshire out from Weaverham.
22 July – The troubled Connecting Devon and Somerset (CDS) Phase 2 projects have encountered further problems as CDS announced that it has terminated two contracts with Bath-based supplier, Truespeed. Truespeed was awarded two contracts backed by £6.7m of public investment to deliver full fibre broadband to 15,172 homes and businesses in areas of Bath & North East Somerset, North Somerset, Mendip and Sedgemoor Districts where there were no credible commercial plans for delivery at that time. CDS stated that the contracts have been terminated on the basis of Truespeed’s failure to meet key contractual commitments made at the time contracts were awarded.
23 July – Hull-based incumbent, KCOM, have announced that it will cease support for Copper Access based KCOM Line Rental (KLR) and Connect Business Voice (CBV) ISDN2, ISDN30 (DASS and DPNSS) and Centrex services from 31 March 2023; ADSL and VDSL customers will have to migrate to FTTP services with ADSL and VDSL products being withdrawn on 31 March 2023.
25 July – London-based G.Network announced it has secured a master wayleave agreement with Hackney County Council, which will see the provider cover at least 80% of the Council’s social housing premises over the next three years.
25 July – Vodafone reported that its fixed broadband subscriber base increased from 1.050m subscribers in Q1 22 to 1.072m in Q2 22.
26 July – Gigaclear is reported to seeking a further £300m capital boost from Rothschild and Co. in order to expand its rural FTTP rollout plans to pass 500k premises by 2023. Gigaclear’s FTTP network footprint currently covers around 300k premises.
Other key news items throughout the month
Policies, Studies, Survey and Ofcom Announcements DCMS - Thousands of rural primary schools to get huge broadband upgrade thanks to £82m in funding DCMS Guidance - National AI Strategy - AI Action Plan DCMS Government Major Projects Portfolio data, 2022 that supports the 2022 Infrastructure and Projects Authority (IPA) Annual Report DCMS Research and Analysis - Measuring the impact of Big Tech firms on the UK economy DCMS Impact Analysis - Data Protection and Digital Information Bill: Impact assessments
Devolved Nations (Northern Ireland, Scotland and Wales) Broadband Announcements Scotland - Enhanced 4G mobile phone coverage programme reaches halfway point Brief Progress Update on Scotland’s R100 Fibre Broadband Rollout Welsh Government and Openreach Extend FTTP Broadband Rollout
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