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Eurobites: Virgin Media Raises Gigabit Stakes in UK

Paul Rainford
7/25/2019

Also in today's EMEA regional roundup: CityFibre sucks up to BoJo; O2 confirms 5G launch; Telefónica's net income slips in Q2, though its revenues rise.

  • Cable operator Virgin Media is upping its game in the broadband stakes, promising gigabit connectivity to nearly 15 million homes -- which constitute its current network -- across the UK by the end of 2021 in what could be seen as a re-boot of its Project Lightning network expansion program. The southern coastal city of Southampton will be the first to get the Virgin gigabit, the switch-on happening sometime later this year. Earlier this week the Financial Times reported that Virgin Media's parent company, Liberty Global, is planning to hugely expand Virgin Media's services reach in the UK by forming a separate wholesale fiber network joint venture backed by infrastructure funds, a move that would put the new entity in direct competition with BT's Openreach and the likes of CityFibre. Virgin's gigabit speeds are being enabled by the deployment of DOCSIS 3.1 technology throughout its access network.

  • And, talking of CityFibre… A month ago, he was still a figure of fun. Now Boris Johnson (BoJo) is the UK's new prime minister, companies need to demonstrate a modicum of respect. One of the first to do so is CityFibre, a fiber investor trying to establish itself as an alternative to former state-owned monopoly BT. In June, CEO Greg Mesch had chuckled during an on-stage presentation about a BoJo-penned newspaper article that pledged all-fiber networks across the whole country by 2025, eight years sooner than an existing target. After BoJo showed he was serious about the scheme during speeches this week, CityFibre is now using words like "delighted" to describe the plan and saying it will "stand ready" to help achieve the vision. It won't be easy, though. CityFibre diplomatically calls the 2025 target "ambitious" and points out that bold steps are needed to achieve it. Those include (deep breath) unlocking "very significant private investment," ensuring companies have access to the "skills and workforce to get the job done" (while the UK exits the European Union), "removing barriers that slow local deployment" and persuading customers that gigabit matters. CityFibre's current plans are to extend all-fiber networks to about 20% of UK properties in the next five years, while BT thinks it might be able to cover 60% if regulatory authorities play fair. And, as mentioned above, cable giant Virgin Media said it would provide gigabit-speed connections to the same proportion of households by 2021. Just don't expect an all-fiber connection in that Lake District mountain retreat anytime soon. (See BoJo Leadership Threatens Huawei & UK's Fiber Future and Brexit-Bound Britain's Broadband Blues.)

  • Telefónica UK (O2) has announced an October launch for its 5G service, with the technology going live in parts of 20 towns and cities this year and reaching 50 locations by summer 2020. O2 says it is "targeting its 5G rollout where customers need it most," which means that transport hubs, key business areas and major sports venues in Belfast, Cardiff, Edinburgh, London, Slough or Leeds will be among the first places to feel the O2 5G force. For the dwindling band of telecom early adopters, O2 is making the Samsung Galaxy S10 5G handset available from August 8, though additional 5G-friendly devices will be rolled out in due course.

  • On the wider stage, Telefónica saw its second-quarter net income decline 4.5% year-on-year to €862 million (US$960.1 million), a dip attributed to a range of factors including tax litigation and hyperinflation in Argentina. Revenues, however, rose 3.7% in "organic" terms to €12.14 billion ($13.52 billion), with handset sales (up 16.7%) providing a welcome boost. Net debt fell by 5.7% year-on-year and stood at €40.23 billion ($44.81 billion) at June 30. Telefónica now lays claim to the largest FTTx/cable network outside China, with 121 million premises passed.

  • Orange also returned to growth, revenues-wise, in the second quarter, increasing the take by 0.5% on a comparable basis, to €10.38 billion ($11.56 billion). EBITDAaL (earnings before interest, tax, depreciation and amortization, after leases) also grew, by 0.9%, to €3.37 billion ($3.75 billion). Orange attributed much of this positive momentum to its African and Middle East sales region, which saw 5.8% revenue growth.

  • Latvian operator LMT is claiming to be the first in the Baltics to launch 5G Internet services on licensed 3.5GHz frequencies. The first basestation was activated in the seaside city of Liepaja, using a Qualcomm 5G-enabled router. LMT began its 5G journey in 2017, in partnership with Nokia and Riga Technical University.

    Singing in 5G
    Well, the choir's turned but where's everyone else?
    Well, the choir's turned but where's everyone else?

  • Three UK has teamed up with SSE Enterprise Telecom to launch a 5G testbed in London's Oxford Street, a bewildered-tourist hell which some say is Europe's busiest shopping district. The hope is that the deployment of the new technology in this trial will enable consumers to "connect and engage with retailers on a new level." Just what Oxford Street needs -- more folk staring down at their phones, looking for bargains…

  • UK regulator Ofcom has firmed up proposals first unveiled at the 5G World event in June to open up spectrum in certain bands to the likes of factories, large farms and business parks for private, secure networks. The airwaves affected are as follows: the 1800MHz and 2300MHz shared spectrum bands, which are currently used for mobile services; the 3.8-4.2GHz band, which supports 5G; and the 26GHz band, which has also been identified as one of the main bands for 5G in the future.

    — Paul Rainford, Assistant Editor, Europe, Light Reading

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