Hampshire-based alternative network operator and gigabit broadband ISP toob, which has spent the past few years deploying a full fibre (FTTP) network – and also sharing some of CityFibre’s infrastructure – across parts of South England, has today become the latest Altnet to confirm some redundancies and a change of build strategy.
Just to recap. 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), which we were told could be upsized to £300m over time to support growth.
However, regular readers will know that a growing number of network operators, both big and small alike, have over the past year moved to slow their network deployments (usually resulting in job losses) and switched their focus toward growing take-up to ensure some future stability. Such moves are a prudent course of action in the current climate of rising build costs and high interest rates, which makes it harder to raise fresh investment.
The latest operator to possibly be experiencing some of these headwinds appears to be toob. According to some of the feedback we’ve received from sources this week, toob is alleged to have announced a large round of redundancies for August 2024, which some have claimed could slow their pace of FTTP build by around half. But toob itself gives a more optimistic interpretation.
A Spokesperson for toob told ISPreview:
“toob has made an internal announcement to our teams that we will be changing our build model at the end of the year, with toob teams doing more of the work directly.
toob has committed funding to deliver a financially stable business based on a network build of over 300k premises alongside expansion of the toob broadband service onto CityFibre’s network. The plan is working well, and we have enjoyed strong customer growth across both networks.
In line with this plan, the business’ existing build areas will be materially complete by the end of this year, in a change to our model further build in 2025 and beyond will be largely delivered by toob teams on an agile and sustainable basis. There will therefore be growth in some areas of the business but fewer roles in others. As a result, some roles may be at risk of redundancy at the end of the year.
As a growing company that values our employees, we made the announcement to allow the maximum time for employees to consider their options for either redeployment or retraining within the company.”
Toob does still appear to be on a modestly stable financial footing (commitment wise), and their build target of 300,000 premises passed does seem viable. But whether they can go significantly beyond that remains to be seen, particularly with consolidation hungry networks like CityFibre lurking nearby (very little overbuild with toob).
The operator declined to tell ISPreview precisely how many jobs were now facing redundancy, although we’ll no doubt get a better idea of this once the usual consultation phase has concluded in the summer.