Optical/IP Networks

Liberty Global flirts with FTTP opportunities in Germany

In the wake of a major fiber-to-the-premises (FTTP) plan that's underway in the UK, Liberty Global is making another bet on fiber, this time in Germany.

The operator's investment arm, Liberty Global Ventures, has teamed up with private equity firm InfraVia Capital Partners to form a new joint venture that will assess opportunities for fiber-to-the-premises (FTTP) networks in greenfield areas in Germany.

The 50/50 joint venture, called Liberty Networks Germany, still needs the regulatory stamp but stressed that the plan is to take a "modular approach" to FTTP. That means the JV will target a small number of underserved German municipalities in phase one, and possibly open up more investment and broaden deployments based on the success of that initial work.

In a statement, Robert Dunn, managing director of connectivity investments for Liberty Global, described the focus of the JV as a "controlled approach" aimed at generating "attractive returns."

A new angle into the German market

The JV also marks a return of sorts for Liberty Global to the German telecom market. Liberty Global was once a major cable services presence in Germany, having operated Unitymedia for a decade. But that changed in 2019 when Liberty Global sold off those assets, along with its operations in Hungary, Romania and the Czech Republic, to Vodafone.

Liberty Global believes its past experience in the German market will aid the JV, citing its past work with German municipalities and regional authorities. Meanwhile, its partner in the venture, InfraVia, has raised more than €7 billion ($8.22 billion) in capital since 2008 and has invested in more than 40 companies, with many of them focused on tech and infrastructure, across 13 European countries.

Liberty Global's expanding fiber focus

Though the new JV is limited and targeted in nature, it does represent another FTTP-focused effort for Liberty Global. Virgin Media O2, the UK giant resulting from the merger of O2 and Liberty Global's Virgin Media, recently announced an ambitious plan to upgrade its entire UK network to FTTP over the next seven years.

Virgin Media O2's existing hybrid fiber/coax (HFC) network won't disappear overnight, as the multi-year upgrade has been dubbed an "overlay," rather than an outright replacement, by Liberty Global CEO Mike Fries. Individual FTTP installations/service turn-ups are expected to be done on an on-demand basis in the coming years.

DOCSIS "will be part of our network solution in the UK for a long time to come," Fries said last month during the company's Q2 earnings call. To wit, Virgin Media O2 announced last month additional DOCSIS 3.1 upgrades covering 1.5 million homes that underpin 1-Gig broadband services. At the time, Virgin Media O2 estimated that more than half its network was capable of delivering gigabit speeds, and expressed plans to bring 1-Gig to its full footprint by the end of 2021.

"We're not decommissioning our cable network. Quite the contrary – we are simply expanding its capacity by pushing the fiber that's already there in the ground even closer to the customer," Fries said.

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— Jeff Baumgartner, Senior Editor, Light Reading

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