Original article Total Telecom:Read More
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The platform launches with an initial partnership with CityFibre, with Trooli and Freedom Fibre to follow in the coming months
This week, Rochdale-based ISP Zen Internet has celebrated the formal launch of The Fibre Hub, a platform that aggregates altnets and major network players.
The idea behind The Fibre Hub is simple enough: combine access to numerous altnets onto a single platform, which ISPs can then access at a wholesale level. This means ISPs will only need to integrate once – with The Fibre Hub – to gain access to numerous altnet networks, greatly reducing complexity.
The initial launch was centred around the integration of CityFibre onto the platform, making CityFibre’s Business FTTP (160 Mbps to 2.5 Gbps) and Residential FTTP (1 Gbps to 2.5 Gbps) available to channel partners alongside existing Openreach access.
Similar deals with Trooli and Freedom Fibre have also been announced, with their networks expected to be made available on the platform in June and July, respectively.
Two additional altnets are “very close” to being formally announced, according to Zen CEO Richard Tang.
“My hope is that the big players – the likes of Vodafone and Sky – will eventually want interconnect with Zen to get access to these smaller networks,” said Tang, speaking to Total Telecom at Connected North last month, adding that initial discussions with the companies were already underway.
According to Tang, achieving a “critical mass” of around “around one million premises” that are not already covered by the likes of Openreach or CityFibre would be enough to make the business case appealing to these major ISPs.
“With Trooli, Freedom Fibre, and the two new partners we’re bringing on board, that’s a very achievable goal,” Tang said.
Speaking more broadly, Tang explained that the highly competitive nature of the fibre market – which has not consolidated as fast as anticipated – had created a major opportunity for aggregation.
“Market consolidation is not really coming along as fast as everyone thinks,” he said. “I think one factor is that investors don’t necessarily want to admit that their business plans have fallen over and selling will crystalise those losses.”
“It’s also just really, really complicated,” he continued. “How do you value an altnet? The market is constantly moving, with overbuild taking place and take-up rates changing quite rapidly. By the time you’ve completed your due diligence for a deal, the networks value might be completely different.”
These inherent complications to M&A could make aggregation an appealing alterative to acquisition for smaller altnets.
“It creates a good opportunity for Zen. If the consolidation takes a bit longer then the window of value that we can provide by aggregating a lot of them together is bigger,” said Tang.
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