Category: BT Broadband

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CityFibre seeks to raise £185m of funding to build its vision of Gigabit Britain 0

CityFibre seeks to raise £185m of funding to build its vision of Gigabit Britain

CityFibre is doing things differently to how full fibre roll-outs are seen by many people, i.e. they operator as the wholesale dark fibre provider with invariably local Internet providers partnering in the towns where their network has been rolled out with local authorities and large businesses often acting as the anchor tennant to ensure that the network does not sit dormant for decades and be just another fibre white elephant. The big news today it is raising £185 million to invest in expanding its footprint and crucially for the public to commence in 2018 actual fibre to the home roll-outs in five to ten new towns and cities in addition to the metro fibre network that underpins the Gigabit City claims.

CityFibre Infrastructure Holdings PLC (“CityFibre” or the “Company”), a designer, builder, owner and operator of fibre optic infrastructure in UK towns and cities, today announces that it intends to raise minimum gross proceeds of £185 million at 55 pence per share, fully underwritten by Citigroup, finnCap, Liberum and Macquarie (the “Banks”) (the “Firm Placing”), with the intention to raise further proceeds through an accelerated bookbuilding process which will be launched immediately following this announcement (the “ABB Placing”) (together, the “Placing”). In addition, the Company intends to raise further gross proceeds of up to £15 million through a non-underwritten offer for subscription (the “Offer for Subscription”). CityFibre on Investment The metro fibre network currently exists in 42 towns and cities across the UK and the expansion is intended to take this to not less than 50 areas by 2020.

The York trial is described as demonstrating strong demand and apparently negotiations are at an advanced stage with retailers to market full fibre services using an expanded CityFibre network. Hopefully this means that as 2018 progresses rather than talking about a rapidly increased number of premises actually passed by FTTH from CityFibre and as with York report on the speeds people are getting (homes passed using the internationally accepted definitions means in York there are 20,000 to 25,000 premises believed to be passed currently. The recent placing of CityFibre in the centre of the £400m HM Treasury Ultrafast broadband investment fund is now much clearer since CityFibre appear keen to continue raising capital to continue to take custom anyway from the traditional leased line market leaders but are also seeking to expand more into the consumer arena with partners.

The purchase of Entanet for £29 million may be a surprise for some, but with Entanet as a well established wholesaler that has some 1,500 partners it providers a perfect avenue for dealing with the long tail of smaller providers who often provider local IT services in addition to broadband connectivity to businesses operating in their local area. This should help to increase the number of business customers and home workers/prosumers signing up to the full fibre services. What is clear for the next few years is that firms who do cable laying are going to be very busy and it may be that access to labour and potentially rising costs if supply is short might actually be what holds back a vision of a full fibre UK more than access to funding.

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What is BT Openreach?</p><p>Everything you need to know 0

What is BT Openreach?

Everything you need to know

If you haven’t heard of Openreach you won’t be alone. But you will have heard of BT, BT Broadband and BT Infinity 1 .  Openreach is a huge division of BT, or British Telecommunications PLC, now known as BT Group. BT Openreach was established in 2006, owns the telecommunications pipework and phone cables in the UK, and employs 32,000 people.  Essentially Openreach owns the entire UK phone and broadband 2 network – and those 32,000 employees are very busy 3 , making around 9.5 million visits to homes and businesses a year; 25,000 per day.  The rest of BT, like other phone providers such as TalkTalk and Sky 4 , are essentially ‘customers’ that have equal access to the Openreach network.

Virgin Media 5 isn’t included because it does not use the copper network – it has its own cable network.  What does Openreach do?  Openreach manages the UK’s local access network – this is what connects your house, the place you work and the shop down the road to the local telephone exchange and everything in between. The green cabinets you see in the street that handle ASDL broadband 6 or phone lines? Openreach owns those.  Openreach also manages the connection between the phone lines and the other providers that connect up in the exchange.

Why does Openreach exist? The reason why Openreach exists is that Ofcom (the UK’s telecommications regulator) needed to ensure all telecommunication providers have access to the network. The problem was that the network was owned by one major company – BT – that, naturally, was the market leader.  As other companies were – quite reasonably – keen to get in on the act during the early days of ADSL broadband 7 , the need arose for the network to be somehow separated from BT’s phone services division.

After Ofcom’s 2005 Telecommunications Strategic Review (TSR), the solution was the establishment of Openreach, even though it remained under full ownership of BT.  Over 500 different companies now sell services that run via the Openreach network.  What is happening now? Fast forward to today and Openreach is undergoing change – BT Group agreed in March 2017 that it would spin Openreach off as a legally separate company. This was, once again, in response to a demand from Ofcom.

This is happening because the arrangement – where Openreach was owned by BT Group – wasn’t working wholly well.  There have been some successes, not least the post-2010 rollout of an £800 million fibre network that has revolutionised non-cable internet connection speeds in the UK.  However, Openreach has come under criticism in Parliament and elsewhere. Rollout of fibre has been slower than was originally promised, while network investment has not been to the level it should have been, notably in rural areas – where network speeds continue to lag behind Ofcom’s minimum target of 10Mbps. This still affects over three million customers in the UK.

Customer complaints via service providers have been high (we personally know several people have have had bad experiences when moving provider or getting new lines installed or repaired because of delays from Openreach). Customers can’t contact Openreach directly, because they have to go through their service provider. Ofcom also fined BT £42 million in early 2017 for regulatory breaches over compensation payments to other telecoms providers for work that was completed late.

Getting faster internet  Ofcom believes there will be more investment in the broadband network through Openreach being a legally separate company. Hopefully it may also mean cheaper broadband deals 8 for you, the consumer.  Without a vested interest from BT, the hope is that there will be more independent consideration regarding investment in the network. BT dragged its heels over the situation in early 2017, but suddenly ceded to Ofcom’s demands before the regulator had chance to take the case to the European Commission. However, it’s worth noting that BT Group will still own Openreach but it will have independence.  One of the ways the network investment could happen is by Openreach co-investing with different key partners in particular areas; previously it could only really upgrade the network if BT thought it was worthwhile (usually if there were enough people who wanted to pay for faster broadband).  But there is some network investment already underway.

Very recently Openreach has experimented with G.fast 9 , which enables the company to bolt on a pod to existing green fibre cabinets to offer next-gen fibre broadband speeds using existing copper phone lines – up to 330Mbps. BT had already committed to give two million customers full fibre connections into their homes and businesses. Currently Openreach’s network is FTTC – or Fibre to the Cabinet, again these are the green boxes you see on street corners.

The connections from there to your home are traditional copper phone lines.

By bringing fibre to your premises (or FTTP), consumers will be able to experience much higher speeds – up to around 1Gbps.

References ^ BT, BT Broadband and BT Infinity (www.techradar.com) ^ broadband (www.techradar.com) ^ very busy (www.openreach.co.uk) ^ Sky (www.techradar.com) ^ Virgin Media (www.techradar.com) ^ ASDL broadband (www.techradar.com) ^ ADSL broadband (www.techradar.com) ^ cheaper broadband deals (www.techradar.com) ^ experimented with G.fast (www.homeandwork.openreach.co.uk)

Peak and off peak performance at largest broadband providers in June 2017 0

Peak and off peak performance at largest broadband providers in June 2017

Peak and off peak performance at largest broadband providers in June 2017 It is time to take a harder look at what the masses of speed test results that we get from our broadband speed test 1  tell us about the largest broadband providers and by looking at this each month of the year over time it is possible to get a sense for which providers get closest to keeping people happy during the busiest times of the day. Off-Peak Tests Results June 2017 Off-Peak defined as midnight to 5.59pm Median Average Provider tbbx1 Test (1 download) httpx6 Test (6 downloads) % difference Upload Speed Quality Latency BT 25.9 Mbps 29.1 Mbps -11% 5.9 Mbps 1.00 41ms EE 11.3 Mbps 12.3 Mbps -8.1% 0.8 Mbps 1.00 49ms Plusnet 19.7 Mbps 22.2 Mbps -11.1% 1.6 Mbps 1.00 48ms Sky 13.6 Mbps 16.4 Mbps -17.1% 3.1 Mbps 1.00 52ms TalkTalk 12.2 Mbps 13.9 Mbps -12.2% 0.9 Mbps 1.00 54ms Virgin Media 40.3 Mbps 61.4 Mbps -34.3% 6.1 Mbps 1.00 44ms The quality metric stands out a lot this month as all of the big five are identical, or more precisely figure is capped at the value of 1 (i.e. the best value we display).

After many months of monitoring this score this is the first time this has happened, and suggests maybe its time for a recalibration and further extra investigative work. The good news is that on the basis of the median scores that the five major providers overall have had a good month, though as always with an average no matter whether its the median or mean there are always those that under perform and over perform. Peak Tests Results June 2017 Peak time defined as 6pm to 11:59pm Median Average Provider tbbx1 Test (1 download) httpx6 Test (6 downloads) % difference Upload Speed Quality Latency BT 25.7 Mbps 27.5 Mbps -6.5% 5.6 Mbps 1.00 43ms EE 11.7 Mbps 13.5 Mbps -14.6% 1.3 Mbps 1.00 50ms Plusnet 19.3 Mbps 23.1 Mbps -16.4% 1.7 Mbps 1.00 48ms Sky 12.1 Mbps 15.6 Mbps -22.4% 2.3 Mbps 1.00 55ms TalkTalk 11.9 Mbps 14.4 Mbps -17.4% 1 Mbps 1.00 56ms Virgin Media 33.7 Mbps 53.2 Mbps -36.6% 5.9 Mbps 1.04 39ms The main speed test results suggested that Virgin Media had improved and at peak times they are only provider from the big 6 to breach the magic best score of 1.00 on quality, telling us that there is still a sizeable tail of users having problems, but that this is less of an issue than it was in May.

In fact looking through our monthly data sets the quality score is back in line with results from 2015.

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