Spotlight Article

Telecoms analyst Chris Lewis, founding director of Lewis Insight, looks back on forty years in the telecoms industry and why telcos today are still struggling to find a sense of identity

This year marks my 40th as a telecoms industry analyst. It all started for me using my foreign languages to do research into European markets for modems and multiplexers around the time that British Telecom was being privatised. Being blind, the spoken word was the perfect media for doing research – which was just as well, as nothing else was available to me in an accessible format apart from sending photocopied articles to a specialist transcription recording service, which I could only listen to a couple of weeks later!

I have continually expanded my industry coverage to embrace all aspects of global telecoms over the intervening decades, with major milestones including the deregulation of European markets in the late 1980s, the US Telecoms Act of 1996, the launch of 3G and the iPhone in the early 2000s, and the advent of Cloud and AI, with a brief appearance from the Metaverse in between.

Deregulation and privatisation have provided an incredible backdrop to all the work I have done with telecoms service providers and suppliers alike. Involvement with regulators, governments, and other interested parties such as the investment community, has continually expanded my analytical horizons beyond technology.

The outside-in perspective and changing market dynamics

What I have noticed, especially recently, is that the inside-out perspective, where everything was about the internal workings of the telecoms networks, has given way to outside-in influences, where other sectors, device providers, applications providers, cloud and AI players, are having a greater influence on the shape of the telecoms industry. The ambitions of governments and regulators back in the 1980s was to break up monopolistic practice and drive greater investment into the technologies that would underpin each country’s economy. The resultant competition has indeed led to wider reach, greater choice, and relatively lower prices for many services.

However, the financial community referred to telcos as ‘utility stocks’ over twenty years ago and the industry’s obsession with next generation and major technology shifts hasn’t changed that view. In fact, the investment community now plays a major role in restructuring the industry, carving telcos into InfraCos and ServCos, aiming to expose the true value of the telecoms sector. Furthermore, what is also exposed are the difference investment cycles and ROIs relating to digging civil works, building towers, and deploying ever more software-centric and cloud-centric technology to deliver the broadband services of the future.

Since I set up Lewis Insight and The Great Telco Debate 10 years ago, I have further expanded my coverage to put telecoms into its context in the broader economy. Changing dynamics have forced me to reevaluate my perspective on the industry on a regular basis.

When describing the size of the $1.5 trillion market, I tend to refer to the French version of a pie chart which they call a Camembert. Rather than the market expanding, the cheese is being nibbled by so many players (mice of different types), whether their origins are in devices, cloud, applications, integration, or data. These are all global players and have scale that no telecoms provider can match, given their primarily national outlook. Regulators, therefore, have to be careful not to stifle the market’s natural tendency to allow consolidation to give telcos the national or regional scale that will help drive investment.

AI, the Metaverse, and the ongoing struggle for revenue growth  

Suffice it to say, the last four decades have been fascinating to follow as an analyst. It is a moot point to ask how many of those years are still relevant to today’s market given the massively changed structure of the industry and the changing relative position of the actual telecoms service providers. The next decade will see ever more influences from outside telecoms shaping what the telecoms players have to deliver to support new business models and possibly even that leap to the Metaverse.

I believe the assumption that this will be accompanied by major revenue growth is flawed, as we are starting to see telecoms companies shedding employees and adopting automation and AI to drive a more efficient, right-sized organisation to support activities more. Connectivity plays a vital role in supporting these new business models, but as it is commoditised and embedded into other activities, it won’t command a premium apart from in some minority cases. It is a vital supporting role but not the starring role many around the industry would have you believe.

So, as I enter my fifth decade as an analyst, I am even more intrigued as to how it will all pan out and especially how AI will help bring together so many diverse elements to deliver services better matched to us as individuals, businesses, and society.

I should add that much of what I say to clients in the industry is said behind closed doors. Arguing against the supplier-driven narrative in the media is best done in this way and carries more weight given the independent position I hold in the sector.

Technology for me has dramatically improved from the days of the spoken word and delayed recorded articles. I now have access to an incredible amount of information via screen readers on my multiple devices, but there is still a lot of work to be done to make everything accessible for everyone.

Finally, one myth I must dismiss is that Varley, my guide dog for the last five years, does not find the inner workings of the telecoms industry at all interesting. I suspect that many outside of telecoms agree with him and the industry needs to work hard to fit in, rather than expecting everyone else to understand the complexity of what it does.

The good news is demand has never been greater, but we need to keep an eye on the product we are selling and how it fits into the broader picture. Ubiquitous high-quality connectivity, fixed and mobile, is what customers expect and I look forward to that becoming a reality in the coming decade.

Keep up to date with all of the latest telecoms news from around the world with Total Telecom’s daily newsletter

Also in the news:
Digi Spain sells 6m FTTH accesses to Onivia
Vodafone’s 5G standalone network now connects around half the German population
Broadband poles no problem for Brits says new study

Interview

At Connected America 2024, we met with Rick Cimerman, VP, External & State Affairs Lead at NCTA – The Internet & Television Association, to discuss the pivotal role of federal funding in advancing broadband connectivity across the United States

Highlighting the implications of the Broadband Equity and Access and Deployment (BEAD) Act, Cimerman underscored the importance of targeted investment and strategic partnerships in addressing the nation’s connectivity gaps. Cimerman also stresses the need for efficient deployment, regulatory clarity, and workforce development to maximize the impact of these funds.  

Through collaboration between federal, state, and industry stakeholders, Cimerman outlines a pathway towards achieving comprehensive broadband access for all Americans. 

Highlights:   

State proposals for funding allocation are currently under review, with implementation expected to start by early 2025. 
It’s important to keep the focus on expanding to unserved areas before underserved areas.  
The best path forward is to partner with experienced cable broadband providers who have the experience and knowledge to deliver projects on time and on budget.  
Federal government agencies need to reduce deployment barriers while avoiding new regulatory burdens like net neutrality rules. 
It will be critical skill shortage through workforce development and training programs. 
Broadband expansion holds transformative potential for communities nationwide. 

Cimerman emphasised the urgency of getting broadband expansion right and the profound impact it can have on communities across the nation. Through strategic investment, regulatory clarity, and collaboration, stakeholders can bridge the digital divide and ensure equitable access to broadband for all Americans.  

You can watch our full interview with Rick from the link below:

What impact will BEAD funding have in creating a more connected America? Join the discussion with the cable operators at this year’s Broadband Communities Summit live in Houston, Texas

Mobile operator O2 (VMO2) has just deployed the first of 7 new masts in rural parts of Stirling (Scotland) to help boost local 4G (mobile broadband) coverage under the £1bn industry-led Shared Rural Network (SRN) programme. The first site, in the remote village of Killin, required a helicopter to deliver the new mast to its site.

The SRN – supported by £501m of public funding and £532m from operators – involves both the reciprocal sharing of existing masts in certain areas and the demand-led building and sharing of new masts in others between the operators (MNO): O2, Vodafone, EE and Three UK. The target is to extend geographic 4G coverage (aggregate) to 95% of the UK by the end of 2025, which falls to 84% when only considering the areas where you’ll be able to take 4G from all providers.

Currently, some 29% of the Stirling council area is said to lack 4G coverage from all four network operators’ with signal blackspots creating an issue for local people and visitors. The investment to solve this forms part of the SRN’s work to tackle Partial Not-Spots (PNS), which is funded by mobile operators, while the government’s side of public investment is more intended for new masts to eliminate Total Not-Spots (TNS)).

Jeanie York, CTO of Virgin Media O2, said:

“At Virgin Media O2, we are committed to playing our part in bringing reliable 4G coverage to communities all over Britain to help bridge the urban-rural digital divide. We’re going to extraordinary lengths to connect the most remote and isolated locations, including using helicopters to fly in phone masts where we need to, as part of our unwavering focus on delivering the Shared Rural Network programme.

Many rural parts of Scotland are already benefiting from our rollout of new and upgraded masts, and we are delighted to bring enhanced mobile connectivity to the beautiful area of Stirling. Our Shared Rural Network rollout continues at pace, with more locations set to benefit in the near future.”

Alyn Smith, the MP for Stirling, said:

“I am delighted to see further Virgin Media O2 investment in the area of Stirling that will help ensure that my constituents have access to reliable mobile connectivity. As with many rural areas, Stirling has previously been at a disadvantage when it comes to connectivity.”

Similar work is also taking place at EE, Three UK and Vodafone.

The Government’s Building Digital UK agency has released their April 2024 (spring) progress update on the £5bn Project Gigabit broadband rollout scheme, which is so far running 37 live contracts and procurements worth £1.9bn in state aid (£1.38bn for 31 signed contracts) to help extend coverage up to an extra 1 million hard to reach premises.

The project aims to extend networks capable of delivering download speeds of at least 1000Mbps (1Gbps) and uploads of at least 200Mbps to 85% or more of UK premises by the end of 2025, before rising to “nationwide” coverage (c.99%) by around 2030 (here). The funding released for this will depend upon how the industry responds, but there are still a lot of contracts yet to be awarded or even enter procurement.

The report notes that nearly 82% of UK premises can now access a gigabit-capable network (up from 79% in the December 2023 update) and Ofcom separately forecasts that gigabit coverage should hit around 87-91% by May 2025 (here), with purely commercial deployments alone (mostly focused on urban and semi-urban areas) being expected to deliver over 80% of that.

Project Gigabit is thus designed to focus on improving connectivity for those rural and semi-rural areas in some of the final 20% (5-6 million premises). This primarily consists of several support schemes, including gigabit vouchers (£210m), funding to extend Dark Fibre around the public sector (£110m) and gap-funded deployments with suppliers (rest of the funding) – known as the Gigabit Infrastructure Subsidy (GIS) programme.

Today’s article is focused upon the GIS programme and related procurement work, which sees ISPs bidding through a new Dynamic Purchasing System (DPS) to extend their networks across disadvantaged parts of the UK. Project Gigabit in England is centrally managed (by DSIT/BDUK – not local councils), although there may be variations in this for Scotland, Wales and Northern Ireland.

What’s New in the April 2024 Update

Since the last update in December 2023 (here), BDUK has now signed a total of 31 contracts (up from 16), valued at over £1.3 billion (up from £666m). The 15 newest contracts cover Kent, Leicestershire and Warwickshire, East and West Sussex, Bedfordshire, Northamptonshire and Milton Keynes, Buckinghamshire, Hertfordshire and East Berkshire, Nottinghamshire and West of Lincolnshire, West Yorkshire and York Area, East Gloucestershire, South Wiltshire, South Yorkshire, the Peak District, West Herefordshire and Forest of Dean, Cornwall and Isles of Scilly, Dorset and South Somerset, and Mid-West Shropshire.

However, there have been some problems too, with the latest update noting that the supplier initially awarded the regional deployment contract for Worcestershire (Lot 24 – valued at £39.4m for 18,400 premises) is “no longer able to sign” (most likely due to the current market strains of rising build costs and high interest rates etc.). “We are currently exploring alternative options for this procurement and will provide more details in the next Progress Update,” said BDUK.

The report separately notes that they are currently aiming to award the first two call-off contracts under the cross-regional framework in the summer. “We use the cross-regional intervention in areas where there has been minimal or no credible market interest in bidding for regional or local procurements, or where initial supplier appetite has fallen away,” said BDUK. Such contracts are so big that they’re only likely to be viable for the largest players to bid on (e.g. BT, VMO2/Nexfibre and CityFibre etc.).

As it stands, the vast majority of areas in England are already contracted or in procurement, although the same isn’t true for the devolved areas of Wales, Scotland and Northern Ireland – many of which are still in the preparation stage. But we do get an idea of the progress for these areas, which we’ve summarised below.

Status of Devolved Countries

➤ Wales

North West Wales, Mid Wales and South East Wales have been included within a call-off under the current cross-regional framework procurement. North Wales and South West Wales will be included within a further call-off once the framework contract is in place.

As of the end of March 2024, 4,600 homes and businesses in parts of Wales have been connected to gigabit-capable broadband using Gigabit Vouchers. The Welsh Government’s Superfast Cymru programme has successfully completed the delivery of gigabit-capable infrastructure throughout Wales, providing nearly 100,000 premises with access to high-speed broadband.

Following the short-term reopening of the Gigabit Voucher scheme in South West Wales (September 2023 to January 2024), and separately in North Wales (December 2023 to January 2024), a total of 39 projects covering over 15,500 premises were submitted to BDUK and have been approved.

➤ Northern Ireland

Project Stratum with Fibrus continues to “build ahead of target“, having delivered gigabit-capable broadband to over 75,000 premises to date (from the 84,000 contracted premises).

Pre-procurement market engagement for Project Gigabit build in Northern Ireland has been carried out and the procurement process will start shortly. It is anticipated this will extend coverage to up to an additional 60,000 premises.

➤ Scotland

The Scottish Government is expected to launch the first Project Gigabit procurement in Scotland, in the Borders and East Lothian areas, in April 2024, and is set to reach over 11,000 premises with gigabit-capable broadband.

Further procurements are expected to launch in phases throughout the rest of 2024 including in Dumfries and Galloway, Fife, Perth and Kinross, Aberdeen, Dundee and Moray Coast, and Orkney and Shetland, subject to market interest being confirmed. Central and North Scotland will be included within a future call-off procurement under the cross-regional framework contract that is currently in procurement, which will be delivered by BDUK.

The Scottish Government’s £600 million Reaching 100% (R100) programme has now provided gigabit connectivity to over 41,000 premises in Scotland across the three R100 contracts, including overspill. The R100 programme has received £52.2 million of UK government funding, including £2.7m new investment into the R100 Central contract area, which alongside £2.8m of Scottish Government reinvestment, is helping fund more than 1,000 additional hard to reach premises, following greater than expected commercial build in the region.

Gigabit Broadband Voucher Scheme projects continue to be built in Scotland. To date, 5,600 vouchers have been used to deliver a gigabit-capable connection to homes and businesses outside of suppliers’ commercial build plans.

Otherwise, you can see a summary of the wider contract progress below.

Live GIS Contracts (Signed)

Area
Contract Awarded
Uncommercial Premises
Value

North Dorset  (Lot 14.01)
Aug-22
7,000
£6.3 million

Teesdale (Lot 4.01)
Sep-22
4,000
£6.6 million

North Northumberland (Lot 34.01)
Oct-22
3,700
£7.3 million

Cumbria (Lot 28)
Nov-22
59,000
£108.5 million

Central Cornwall (Lot 32.02)
Jan-23
9,200
£18 million

South West Cornwall (Lot 32.03)
Jan-23
9,400
£17.6 million

Cambridgeshire and adjacent areas (Lot 5)
Mar-23
44,400
£68.6 million

New Forest (Lot 27.01)
Mar-23
10,400
£13.7 million

North Shropshire (Lot 25.02)
Apr-23
12,000
£24 million

Norfolk (Lot 7)
Jun-23
62,200
£114.2 million

Suffolk (Lot 2)
Jun-23
79,500
£100.4 million

Hampshire (Lot 27)
Jun-23
75,500
£104.1 million

North East Staffordshire (Lot 19.01)
31st October 2023
5,900
£16.5 million

South Oxfordshire (Lot 13.01)
Oct-23
5,500
£17 million

North Oxfordshire (Lot 13.02)
Oct-23
4,200
£9.4 million

Derbyshire (Lot 3)
Nov-23
17,800
£33.4 million

Kent (Lot 29)
Feb-24
50,900
£112.2 million

Leicestershire and Warwickshire (Lot 11)
Feb-24
38,600
£71.5 million

East and West Sussex (Lots 16 and 1)
Feb-24
52,800
£100.6 million

Bedfordshire, Northamptonshire and Milton Keynes (Lot 12)
Feb-24
25,700
£51.4 million

Buckinghamshire, Hertfordshire and east Berkshire (Lot 26)
Feb-24
34,200
£58.7 million

Nottinghamshire and West of Lincolnshire (Lot 10)
Feb-24
34,300
58.6 million

West Yorkshire and York Area (Lot 8)
Feb-24
28,000
£60.9 million

East Gloucestershire (Lot 18)
Feb-24
4,400
£16.8 million

South Wiltshire (Lot 30)
Mar-24
17,400
£18.8 million

South Yorkshire (Lot 20)
Mar-24
32,100
£44.4 million

Peak District (Lot 3.01)
Mar-24
4,400
£10.7 million

West Herefordshire and Forest of Dean (Lot 15)
Mar-24
7,900
£23.4 million

Cornwall and Isles of Scilly (Lot 32)
Mar-24
16,800
£41.2 million

Dorset and South Somerset (Lot 14)
Mar-24
21,400
£33.5 million

Mid-West Shropshire (Lot 25.01)
Apr-24
6,000
£12 million

Take note that, once a contract has been signed, it sometimes takes operators several months of engineering surveys before they can begin to build and reveal their rollout plan. Furthermore, the contract values above are only referencing public investment, but in some cases suppliers have also contributed their own private investment or made complimentary commercial commitments to expand into additional areas (e.g. CityFibre).

On top of the already agreed contracts, Project Gigabit also has a number of local, regional and cross-regional deals in the procurement phase for other parts of the UK (see below) and will be awarding contracts for these over the coming months and years. The dates and figures mentioned below are tentative estimates (subject to change) and will remain that way until after the contracts have been awarded.

Bidders on the related LOTS will be required to ensure that their networks and infrastructure are available for use by other ISPs via wholesale (open access). Various operators, both big and small alike (e.g. Openreach, Cityfibre, nexfibre (VMO2), GoFibre, Wildanet etc.), are already taking part and areas with sub-30Mbps speeds are being prioritised, albeit NOT to the exclusion of all else.

Alongside all this, the government and local bodies are also conducting various Public Reviews and Open Market Reviews (OMR), which is the process they use when trying to identify existing commercial coverage of gigabit-capable networks and any planned coverage over the next c.3 years. By doing that, they can more easily target their support toward areas where commercial projects will not go (i.e. the intervention area).

Live GIS Procurements

Area
Est. Contract Award Date
Uncommercial Premises
Value

Worcestershire (Lot 24)
Jul-24
18,400
£39.4 million

Cheshire (Lot 17)
Apr-24
16,400
£43.1 million

Lincolnshire (including NE Lincolnshire and N Lincolnshire) and East Riding (Lot 23)
April to June 2024
73,800
£118.9 million

North Yorkshire (Lot 31)
Apr-24
39,900
£73.4 million

Lancashire, North Wiltshire and South Gloucestershire, West and Mid-Surrey, Staffordshire, West Berkshire Hertfordshire (Call-Off 1)
July 2024 to September 2024
57,100
£149.7 million

West and North Devon, North West, Mid and South East Wales (Call-Off 2)
July 2024 to September 2024
47,100
£139.1 million

As stated earlier, there are also a sizeable number of projects that have yet to enter the procurement pipeline, mostly for parts of Scotland and Northern Ireland. But there are also several cross-regional procurements planned for parts of England where BDUK has struggled to attract much interest via past efforts. We don’t list these as such tentative plans are subject to frequent changes, but you can see them via the link at the bottom of this article.

Conclusion

Sadly, it’s taken a long time to get all of these contracts into procurement, let alone award them. The new and more automated DPS system was supposed to make all of this faster and more efficient than just handing the funds to local authorities, but we’re now into early 2024 and yet some areas still haven’t got any big GIS procurements going.

Otherwise, we should remind readers that this rollout is NOT an automatic upgrade, thus you will still need to order the service from a supporting ISP in order to benefit. Similarly, 1Gbps is the target speed, but slower and cheaper options will also exist on the same lines. Similarly, where full fibre technology is being used, multi-Gigabit speeds are also possible.

The focus on “gigabit” speeds also overlooks the fact that this largely relates to download performance, while BDUK’s technical definition states that this falls to a speed of at least 200Mbps for uploads (here). This is understandable, as not all gigabit networks today are actually setup to deliver true symmetric performance.

Lest we forget that there are a lot of real-world reasons why consumers buying a gigabit package might not actually be able to achieve the top speed, due to certain realities of how networks work (Why Buying Gigabit Broadband Doesn’t Always Deliver 1Gbps).

Finally, we should add that the Government has previously warned that those in the final 0.3% or so of premises may be “prohibitively expensive to reach” (i.e. under 100,000 premises) – roughly the same gap that the 10Mbps USO has struggled to fix. Solutions for those in the final batch of “Very Hard to Reach” areas are still being tested.

Project Gigabit April 2024 Update
https://www.gov.uk/government/publications/project-gigabit-progress-update-april-2024

Low-cost focused UK broadband ISP Plusnet (BT Group), which seems to have spent the past few years scrapping many of its extra features (TV, Mobile etc.), has perhaps unsurprisingly now confirmed that it will no longer offer home phone services to existing customers once analogue (PSTN/WLR) services are switched off by BT and Openreach.

The news is not particularly surprising because, thus far, Plusnet has flatly refused to copy parents BT and EE by introducing their own IP-based Digital Voice solution. This would mean that, without a change in their approach, customers who remain on their analogue phone services (e.g. those with older ADSL or FTTC / VDSL2 based broadband bundles) would eventually end up being forced to switch ISP, adopt a broadband-only package or run the risk of disconnection when the old services are withdrawn.

Existing Plusnet customers can continue to use their home phone services for now, but the ISP told The Sun that those who wish to retain a home phone product would instead be offered “exclusive access to the very best deals on BT and transition to their digital landline service will become available” (they’re already doing this).

The situation isn’t such a problem for new customers, since Plusnet has only been offering broadband-only packages to them for a while now (via FTTP and SOGEA based FTTC). The approach being taken by Plusnet is, in our view, a poor one given that they are in a perfect position to benefit from BT’s Digital Voice solutions and approach.

Broadband, TV, phone and mobile provider BT (inc. EE) has today introduced their new “clear and simple” pricing policy, which sees them move away from % figures and CPI (inflation)-linked changes for their monthly plans in order to “provide certainty for our customers on exactly what their price change will be, and when“.

In case anybody has forgotten. Back in January 2024 BT became the first ISP to announce (here) that, in light of Ofcom’s recent move to BAN broadband ISPs and mobile network operators from doing mid-contract price hikes that are linked to confusing inflation and percentage-based changes (here), they would instead a new approach.

The regulator’s change was never designed to stop mid-contract hikes completely, but it did require providers to tell customers precisely what any future price increases would be when they sign up (“in pounds and pence“), which crucially rules out changes linked to unknown future inflation values or percentages.

BT previously said they would introduce this approach from the “early summer”, but instead both they and EE have opted to introduce it today. The exception is sibling broadband ISP Plusnet, which for whatever reason “will follow later this summer.” At present, this will only apply to contracts for new and upgrading customers.

Marc Allera, CEO of BT’s Consumer Division, said:

“We want to act in line with Ofcom’s guidance to move from % figures and CPI-linked changes for our monthly plans and provide certainty for our customers on exactly what their price change will be, and when. So, starting today (10 April), we will introduce a new model for BT and EE customers’ price changes consistent with Ofcom’s approach that shows pounds and pence amounts in new and upgrading customers’ contracts. Plusnet will follow later this summer.

From 31 March 2025, for new and re-contracting mobile customers, this annual increase will be an extra £1.50 a month. It will be £1.50 a month for connected devices (including laptops, tablets and smart watches), £2 a month for TV customers, and £3 a month for broadband customers. Out-of-bundle services will be subject to an annual 5% increase.

There will be no plan increases for our customers in financially vulnerable circumstances on EE Basics or BT Home Essentials.

…

It is also important to point out that our price rises have not risen in line with usage. Customers’ consumption of data, across the industry, has trebled across mobile and fixed networks in the past five years alone. All this while telco services continue to make up only a small and declining share of household outgoings, representing just 3.5% of average monthly basket spend.”

Just to be clear on the above, a customer taking both broadband and TV would see a combined increase of £5. Ofcom currently plans to confirm their aforementioned BAN sometime this spring and, allowing time for implementation, this means that it won’t be enforced until sometime in the second half of 2024. The reality here is that, given Ofcom’s proposed change, this outcome will soon become inevitable for all providers that do mid-contract increases (a lot of smaller players don’t).

The proposed increases may potentially still come in as being above the rate of forecast inflation (CPI) when they hit existing customers in 2025 (much depends upon what inflation will be doing at that point). In theory this suggests that customers affected by the future hike may, under Ofcom’s existing rules, be able to exit their contract penalty free again and switch away (or use it as a tool to renegotiate a lower price).

As we’ve said before, the move to ban the current model is less about cutting customers’ bills and more about making future package pricing clearer and simpler to understand.

Hampshire-based network builder and gigabit broadband ISP toob, which is rolling out their own full fibre (FTTP) network and also sharing some of CityFibre’s similar infrastructure in parts of South England, has today announced that they’re extending their own network near Fareham into the nearby Locks Heath area.

Under the new plan, toob will invest £5 million to extend their Fibre-to-the-Premises (FTTP) infrastructure into Locks Heath and the surrounding area – covering 12,000 homes and businesses. The new network should be ready for its first connections in July 2024, with the deployment continuing across Locks Heath, Park Gate, Warsash, and the surrounding areas.

Toob was originally backed by £75m from the Amber Infrastructure Group (here) and “up to” £87.5m from the Sequoia Economic Infrastructure Income Fund (here). During 2023 the operator also secured £160m of additional funding (debt financing) from Ares Management‘s Infrastructure Debt strategy (here) – this can be upsized to £300m over time to support growth.

Nick Parbutt, CEO of toob, said:

“We are delighted that our network is expanding to Locks Heath, Park Gate, Warsash, and the surrounding areas. toob has been built on our belief that access to fast, reliable broadband at an affordable price is a necessity in today’s increasingly digital world. That’s why we are committed to delivering the fastest, most reliable service, using the latest full-fibre technology, at an affordable price.”

Customers of the service typically pay just £25 per month on an 18-month term for their 900Mbps (symmetric speed) package (£29 thereafter), which includes a router, unlimited usage, free installation and a pledge of “no in-contract price rises“. But toob is due to increase the pricing for new customers from £25 to £29 in mid-May (£33 thereafter).

Trade body Mobile UK, which represents network operators Three UK, EE (BT), O2 (Virgin Media) and Vodafone, has today published a new report that warns “widespread adoption of 5G [is] at risk of being missed” unless the government makes changes to help deliver 5G (mobile broadband) upgrades.

Regular readers will note that this isn’t the first time Mobile UK have pleaded for the Government to do more to support their network upgrades. In fact, they said much the same thing just before this month’s Spring Budget 2024 announcement (here), which appears to have fallen on deaf ears (judging by the lack of positive support in the budget).

According to the new and somewhat high-level report – ‘Rebalancing Act: Unlocking the potential of the UK’s Mobile Industry‘ – mobile technology is estimated to generate £5 of value for every £1 invested by mobile operators, while 5G networks have the potential to provide a £159bn boost to the UK economy by 2030.

However, the report also warns that government targets, like the goal of reaching “all populated areas [with] ‘standalone’ 5G (5G-plus) [technology] by 2030” (here) are at potential risk of not being met. 5GSA is the next evolution of 5G mobile technology, which is a true end-to-end 5G network that can deliver improvements such as ultra-low latency times (faster), greater energy efficiency, faster upload speeds, network slicing capabilities, improved support for Internet of Things (IoT) devices, increased reliability and better security.

The Digital Connectivity Forum (here) has previously also identified a related £25bn investment gap, which operators are trying to fill.

Hamish MacLeod, CEO of Mobile UK, said:

“It’s clear the industry is delivering strong value through the generation of £5 return to the wider economy for every £1 invested by the operators, and so enabling a positive investment environment for the sector must be the clear priority of government,” said Hamish MacLeod, CEO of Mobile UK.

As a country we are not making enough progress to meet the objectives of the Wireless Infrastructure Strategy which acknowledges the power of mobile technology and the ambition to be a leader in 5G.

Reductions in spectrum licence fees, reforming traffic management regulations and Business Rate holidays for new mobile infrastructure would incentivise investment. In addition, adequately funding the planning system and appointing digital champions in local authorities would help streamline network rollout and get the UK back on track to achieve its targets.”

Naturally the report, which suggests that the UK is currently far from being a leader in 5G (various network performance and coverage studies do tend to indicate that the country is a 5G laggard), proposes a series of recommendations to help address the problem.

The Recommendations

• Recommendation 1: At a minimum, following through on policies and actions outlined in the Wireless Infrastructure Strategy – such as reducing annual licence spectrum fees to stimulate investment, reforming the traffic management regulations and driving demand in the public sector.

• Recommendation 2: Explore further policy actions designed to remove barriers to network rollout – including adequate funding of the planning system, the implementation of Digital Champions within local authorities to promote the rollout and adoption of digital technologies, and further reform of permitted development rights.

• Recommendation 3: Implement fiscal measures that will have a direct and immediate impact on improving MNO investment outlook – including Business Rates holidays for new mobile infrastructure.

• Recommendation 4: Consider further actions that can be taken to support private capital being deployed in the UK by mobile operators – taking into consideration significant interventions in other territories (such as the Inflation Reduction Act in the US and the Resilience and Reconstruction Fund in the EU) and the need for operators to offer competitive returns to investors.

Sadly, we can see some potential problems with these ideas. Firstly, both the government and Ofcom have traditionally been reluctant to slash licence fees, particularly at a time when they’re already having to deal with a significant strain on public finances. Predictably, we can also observe the usual attempt to weaken the Net Neutrality protections for internet access, which was recently tackled by Ofcom (here) – any bigger changes would require tedious new Government legislation.

As for softer planning rules, we’ve already seen some positive developments on this front, such as changes to support taller masts and making it easier to upgrade existing sites via Permitted Development (PD) rights. But one difficultly for the government is that they have to balance such demands against issues of public opinion (i.e. new mobile masts and poles often attract complaints), which is much more relevant in an election year.

The idea of a business rates holiday on new mobile infrastructure is another fairly familiar call, although it tends to be a complicated solution (the Valuation Office Agency is not the easiest of organisations to deal with) and there may thus be better approaches that could be taken to help incentivise a similar outcome.

The reality here is that the Government might prefer to wait until after both the Vodafone and Three UK merger (assuming it’s approved and that’s not guaranteed), as well as the next round of 5G friendly spectrum auctions, have gone through before considering what other changes may be needed. The catch is that we may well have a very different government by then, which may be either more or less receptive to the operators’ demands.

Rehovot, Israel and Berlin, Germany (April 10, 2024) – Salvador Technologies, the pioneering cyber-attack recovery platform provider for critical infrastructures and industrial organizations, today announced that the company has secured investment from Deutsche Telekom, the largest telecommunications provider in the European Union.

Deutsche Telekom executed this investment in Salvador Technologies through its hubraum Fund, the  company’s early stage investment arm. hubraum helps its portfolio companies connect with the fund’s global network of business and technology ecosystem partners and provides the opportunity to tap into Deutsche Telekom’s customer base.

Salvador Technologies will use the proceeds from this investment to accelerate the expansion of the company’s sales distribution network for its cyber-attack recovery platform. The company is currently focusing on engaging sales channel and technology ecosystem partners in the DACH region and Poland in Europe as well as in the United States.

Salvador Technologies has developed a patented security failover technology to prevent downtime damage and ensure ongoing operational continuity for Operational Technology (OT) and Industrial Control Systems (ICS). The company’s cyber-attack recovery platform consists of hardware connected to the HMI or SCADA, an agent software and a monitoring system, enabling full visibility of the operations. The platform bypasses standard recovery protocols and allows critical infrastructure operators and industrial enterprises to recover from cyber-attacks and any malfunction within only 30 seconds.

The company distributes its cyber-attack recovery platform through channel partners, including managed security service providers (MSSPs), system integration (SIs) firms and value-added resellers (VARs). These channel partners are using Salvador Technology’s air-gapped platform to offer new and improved managed cybersecurity services to ensure the operational continuity of their critical infrastructure and industrial enterprise customers.

“Deutsche Telekoms is committed to ensuring business continuity, especially in light of the spike in cyberattacks against critical infrastructure and operational technology systems over the past few years and we recognize the significant potential of Salvador Technology’s recovery solution for critical systems,” said Tamar Shlimak, Investor at Deutsche Telekom’s hubraum Fund. “OT/ICS security has become increasingly important to industrial enterprises, so we are excited to have the opportunity to work with Salvador Technologies’ team and contribute to the company’s positive impact.”

“We are tremendously pleased with our strategic efforts with Deutsche Telekom both as an investor and a potentially valuable business partner,” said Alex Yevtushenko, Co-Founder and CEO of Salvador Technologies. “The proposed collaboration could offer significant advantages through leveraging Deutsche Telekom’s global network to potentially expand our business presence in Europe and the United States.”

About Salvador Technologies

Founded in 2020, Salvador Technologies provides security failover technology for cyber-attack recovery and downtime prevention in Industrial Control Systems (ICS) and Operational Technology (OT) organizations. Its innovative solution bypasses standard cyber-attack recovery protocols and forensics measures, minimizing downtime, and regains operations within an astonishing 30-second timeframe. The company’s platform is used by some of the world’s most secure critical infrastructure organizations, including manufacturing, aerospace, maritime, energy and water companies.

For more information, please visit www.salvador-tech.com.

About Deutsche Telekom

Deutsche Telekom is one of the world’s largest integrated telecommunications companies with 245 million mobile customers and 25 million fixed-network lines spread across more than 50 countries. The company offers consumers broadband, fixed-network, mobile, Internet, and IPTV services, as well as business and corporate ICT solutions, with the goal of becoming the world’s leading digital telco.

The Hubraum Fund, Deutsche Telekom’s early-stage venture capital arm, invests in disruptive technologies in Europe, Israel and the United States in areas including 5G, IoT, Cybersecurity, Connectivity, Future of Work, Artificial Intelligence, and Media. For more information, please visit hubraum Fund.  

Press Contact

Tony Miller
+972 544 870 808
tony@noteya.com

News

The new contracts cover areas including Cornwall, the Peak District, and the Forest of Dean 

Today, the UK government has released its Spring update for Project Gigabit, its £5 billion plan to upgrade digital connectivity in hard-to-reach areas across the country.  

The update revealed that gigabit broadband coverage in the UK has reached 81% of all premises, a remarkable increase from 6% in 2019, which the government claims places the nation on track to achieve its goals 85% coverage by 2025 and the whole of the UK (roughly 99%) by 2030. 

One of the key milestones reached was the awarding of over £1 billion in contracts under the project, with 15 multi-million-pound contracts signed this year. These contracts will extend coverage to more than 370,000 homes and businesses across various regions including Kent, Buckinghamshire, Gloucestershire, and Yorkshire. 

Of those 15 contracts, six have been announced today:. 

Wholesale network provider FullFibre has secured two contracts worth £33 million for broadband expansion in Derbyshire and Herefordshire to reach a total of 30,000 hard-to-connect homes.
Quickline has been awarded £44 million to extend their fibre network by 32,100 in South Yorkshire
Wessex Internet has secured £33.5 million to connect 21,400 premises in Dorset and South Somerset, which is expected to commence at the end of this year.
Wildanet has been awarded £41.2 million to connect 16,800 premises in the Cornwall and Isles of Scilly, with installation beginning in the Autumn
Voneus has been awarded £12 million to connect 6,000 premises in Shropshire. The first properties under this contract are expected to have Gigabit access next year.

In total, 31 Project Gigabit contracts have been signed so far, with a combined value of over £1.3 billion and aiming to bring gigabit speeds to nearly 800,000 rural homes.  

The government also noted the impact that existing contacts were already having on local communities. Since the December 2023 project update, for example, Wales, Yorkshire and the Humber, and the East Midlands have seen a 3–4% increase in gigabit-capable connectivity. Notably, the period from August 2023 to May 2024 brought more growth in gigabit connectivity for Yorkshire and the Humber and the East Midlands than the entire year from August 2022 to August 2023. 

But not every infrastructure deployment contract has progressed smoothly. In Worcestershire, for example, a contract worth £39.4 million for 18,400 premises has fallen through for uncited reasons (most likely the rising cost of deployment), with the government “currently exploring alternative options for this procurement”. 

Catch up with the Northern based broadband providers at this year’s Connected North event – 22-23 April in Manchester. Secure your last minute tickets now!

Also in the news:
Digi Spain sells 6m FTTH accesses to Onivia
Vodafone’s 5G standalone network now connects around half the German population
Broadband poles no problem for Brits says new study