BT, as part of its discussion of its fiscal 2019/20 fourth quarter and year-end financial results, disclosed that it hopes to accelerate its fiber to the premises (FTTP) deployment plans. The new strategy comes as a new competitor, the joint venture between Liberty Global and Telefonica announced at almost the same time as the BT financials, looms over the horizon.
The UK incumbent service provider now says it expects to pass 20 million premises by the mid- to late-2020s, as long as it has “the required critical enablers,” in the words of a BT press release. Those enablers likely are regulatory in nature. The company previously had expected to pass 15 million premises by the mid-2020s via Openreach, its independent access network subsidiary (see “Openreach adds 36 locations to FTTP build list”). The accelerated schedule now calls for Openreach to reach 4.5 million premises passed by March 2021.
"BT has the best network infrastructure in the UK,” stated BT Chief Executive Philip Jansen. “We have the largest and most extensive fixed network and are leading the UK on the next generation fiber-to-the-premises network where we now pass 2.6 million premises. Today we are announcing a rapid acceleration of our FTTP build with a target of 20 million premises passed by the mid- to late-2020s, including a significant build in rural areas.
“After passing 1.3 million premises last year, we are aiming at over 2 million in 2020/21, and envisage a maximum build rate of 3 million premises per year,” Jansen continued. “Our FTTP investment should deliver pre-tax nominal returns of between 10% to 12% and is based on a regulatory framework consistent with Ofcom’s preferred policy direction and continued support for infrastructure investment and competition.”
To help fund the more rapid FTTP roll-out, BT will suspend payment of a dividend to shareholders until 2022.
Despite the increase in deployments over the long term, BT expects Openreach to see some rollout challenges in the near term due to the effects of the COVID-19 coronavirus. “Looking forward, Openreach is seeing an adverse impact on trading as a result of COVID-19,” said BT. “While Openreach anticipate lower churn, significant reductions in the volume of broadband and Ethernet upgrades and provisioning are expected, due to reduced business activity, including fewer new site builds, and restrictions on provisioning activity under current stay-at-home guidelines. Openreach is prioritizing service and maintenance to support vulnerable customers.”
The announcement came on the same day that Liberty Global and Telefonica would merge their UK operations, which include cable MSO and broadband services provider Virgin Media and mobile network operator O2 (see “Liberty Global, Telefonica to merge Virgin Media, O2 into joint venture”). The resulting company would rival BT for nationwide reach and subscriber count. BT also faces competition from a number of alternative FTTP network operators.
For related articles, visit the FTTx Topic Center.
For more information on FTTx technology and suppliers, visit the Lightwave Buyer’s Guide.
To stay abreast of fiber network deployments, subscribe to Lightwave’s Service Providers and Datacom/Data Center newsletters.
Stephen Hardy | Editorial Director and Associate Publisher, Lightwave
Stephen Hardy is editorial director and associate publisher of Lightwave and Broadband Technology Report, part of the Lighting & Technology Group at Endeavor Business Media. Stephen is responsible for establishing and executing editorial strategy across the both brands’ websites, email newsletters, events, and other information products. He has covered the fiber-optics space for more than 20 years, and communications and technology for more than 35 years. During his tenure, Lightwave has received awards from Folio: and the American Society of Business Press Editors (ASBPE) for editorial excellence. Prior to joining Lightwave in 1997, Stephen worked for Telecommunications magazine and the Journal of Electronic Defense.
Stephen has moderated panels at numerous events, including the Optica Executive Forum, ECOC, and SCTE Cable-Tec Expo. He also is program director for the Lightwave Innovation Reviews and the Diamond Technology Reviews.
He has written numerous articles in all aspects of optical communications and fiber-optic networks, including fiber to the home (FTTH), PON, optical components, DWDM, fiber cables, packet optical transport, optical transceivers, lasers, fiber optic testing, and more.
You can connect with Stephen on LinkedIn as well as Twitter.