Also in today's EMEA regional roundup: Openreach slammed by UK MPs; BT disagrees; low device sales hit Telenor's Q2 revenue.
Fiber broadband access operator Hyperoptic has bagged a £21 million (US$27.5 million) loan from the European Investment Bank to help fund the rollout of gigabit broadband to more than half a million homes in the UK. Added to money from the George Soros-owned Quantum Strategic Partners, this brings the total investment in Hyperoptic to £75 million ($98.4 million). Earlier this year Hyperoptic, which specializes in supplying FTTP service to multi-dwelling units (MDUs), expressed its disappointment with the UK government's stated belief that the country's broadband market doesn't need fiber-to-the-premises (FTTP) deployments to meet Britain's requirements beyond 2020. (See Hyperoptic Lands £21M Backing for Gigabit Expansion in UK and Hyperoptic Is Apoplectic.)
In related territory, a new report from the parliamentary Select Committee, Establishing world-class connectivity throughout the UK, has criticized BT Group plc (NYSE: BT; London: BTA) for under-investing in Openreach , its network access unit. The report states: "A concern expressed about BT is that Openreach has been 'over-earning' substantially in relation to its cost of capital while Openreach’s investments, including in fibre, have not increased since 2009 … BT has failed to improve already poor quality levels at Openreach in recent years, while overall investment has remained flat until very recently." BT broadband rival CityFibre was quick to pipe up with its response to the Select Committee report, saying: "As this report highlights, Openreach's legacy networks are not able to meet the requirements and demands of businesses, local government and consumers. Competitive investment in fit-for-purpose fibre infrastructure is now critical, and this need must be recognised and supported by both the Government and Ofcom." (See Eurobites: BT Avoids Openreach Split, Ofcom Does Not Rule Out BT Carve-Up and Vodafone CEO: I Want a Piece of Openreach.)
Fighting its corner, and possibly anticipating some of the fallout from the aforementioned Select Committee report, BT has put out an announcement claiming Openreach is making progress on customer service. According to BT, Openreach's engineers now fix 84% of reported faults within two working days, compared to 67% two years ago. BT also says that Openreach has cut the average waiting time for an appointment from 11 to seven days.
Low device sales were blamed by Norway's Telenor Group (Nasdaq: TELN) for less-than-stellar numbers in its second quarter, as organic revenue edged up 0.6% on the year-earlier period to 32.5 billion Norwegian kroner ($3.8 billion). Organic EBITDA, however, grew by more than 6%, to NOK11.5 billion ($1.3 billion). The removal of roaming barriers for Telenor customers in Norway, Denmark and Sweden depressed roaming revenues, though Telenor hopes that increased take-up of its new tariffs will make up for this in the long term. (See Telenor Group Reports Q2 Growth.)
Orange (NYSE: FTE) is investing an undisclosed amount into the PayJoy digital platform, which allows people with little or no credit history to pay for a smartphone in regular installments. The investment is being made through its Orange Digital Ventures unit, and forms part of PayJoy's Series A funding round.
Vodafone Group plc (NYSE: VOD) and Liberty Global Inc. (Nasdaq: LBTY) are to appoint two key executives for their proposed joint venture in the Netherlands, which will, if it gets regulatory approval, combine Vodafone's Dutch unit with Liberty Global's Ziggo B.V. Jeroen Hoencamp, currently CEO of Vodafone UK, will be made CEO of the new venture, while Richy Drost, currently CFO of Ziggo, gets the CFO role.