BT Openreach to Ramp Up Fiber Rollout

BT today unveiled plans to increase Openreach's fiber rollouts by one-third within the next 18 to 24 months. However, the UK incumbent operator said in its earnings press release that its plans hinge on a more positive regulatory environment and tax relief.

Openreach, the semi-autonomous network access arm of BT, is increasing and accelerating its FTTP investment to deliver 4 million premises passed with fiber by March 2021, up from 3 million now. Meanwhile, BT announced that it hopes to pass 15 million fiber-fed premises by the mid-2020s, if it gets the right regulatory concessions, like business tax relief.

Openreach is currently progressing FTTP build in 26 locations. In April, Openreach announced a further 12 locations to benefit from FTTP availability in the next 12 months, bringing the total to 38, according to BT's earnings report.

BT CEO Philip Jansen, who joined BT about three months ago, noted BT's sometimes tumultuous relationship with government regulator Ofcom. In the past, the agency demanded BT and its wholesale division Openreach operate more independently of each other, claiming BT had an unfair advantage over other providers that also used Openreach's infrastructure.

The earnings statement included brief descriptions of other Ofcom policies and pending actions, ranging from rural connectivity programs to reimbursement to BT for over-payment of spectrum fees several years ago.

Focus on fiber
In 2018, BT reported revenue of £23.5 billion ($30.6 billion), down 1% compared with last year, and profits down 2% to EBITDA £7.4 billion ($9.6 billion).

Openreach expanded its ultrafast broadband network over the past 12 months, passing about 1.2 million houses with FTTP and nearly 2 million with Gfast. It completed 2.4 million fiber-broadband net connections in the fiscal year, and now has more than 12.2 million premises connected to fiber, the press release said. Openreach passed an average of about 14,000 premises with FTTP each week in its most recent fiscal year. During the most recent quarter, it accelerated its build rate to approximately 20,000 premises passed per week. Openreach spends about £300 to pass each UK premise, the low-end of the average £300 to £400, it said. And it should reach about half the UK's premises within this price range.

The combination of faster take-up speeds, including ultrafast broadband, plus new consumer and business products that require high-speed Internet and Ofcom's creation of clear, long-term frameworks that support investment in British digital infrastructure, are encouraging signs, BT wrote.

"We need to invest to improve our customer propositions and competitiveness. We need to invest to stay ahead in our fixed, mobile and core networks, and we need to invest to overhaul our business to ensure that we are using the latest systems and technology to improve our efficiency and become more agile," said Jansen, as quoted in BT's press release. "Our aim is to deliver the best converged network and be the leader in fixed ultrafast and mobile 5G networks. We are increasingly confident in the environment for investment in the UK. We have already announced the first 16 UK cities for 5G investment."

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— Alison Diana, Editor, Broadband World News. Follow us on Twitter or @alisoncdiana.

(Home page image source: BT)