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CityFibre to extend fibre footprint after bagging more Project Gigabit contracts

UK fibre wholesaler CityFibre will increase its network coverage to 651,000 additional homes and businesses.

Nick Wood

February 6, 2024

3 Min Read

The extension has been made possible after it secured five new Project Gigabit contracts. Valued at £394 million in total, they cover the hard-to-reach parts of Buckinghamshire, Hertfordshire, Berkshire, Leicestershire, Warwickshire, Sussex, Kent, Bedfordshire, Northamptonshire and Milton Keynes.

Although the contracts subsidise fibre to 'only' 202,000 premises, it has spurred CityFibre on to expand the footprint of its commercial network to cover almost another 450,000 across those aforementioned areas, bringing the total to somewhere in the region of 651,000.

And with CityFibre firmly focused on deploying XGS-PON technology, it means these locations are set to be covered by a 10-Gbps-capable FTTH network, which is not too shabby.

These latest contracts bring the total value of Project Gigabit subsidies awarded to CityFibre to more than £780 million.

In March last year, it won a contract worth £69 million to connect 45,000 locations in rural Cambridgeshire. At the time, CityFibre committed to covering an additional 170,000 premises in the area with its commercial network.

Last July, CityFibre secured £318 million in public funding to deliver fibre to 218,000 premises in Norfolk, Suffolk and Hampshire. As before, it announced an extension to its privately-funded network, this time to an extra 283,000 premises in these locations.

"We're thrilled to be a key delivery partner for the government on this critical infrastructure project, transforming the digital capabilities of rural homes and businesses across the country," said CityFibre CEO Greg Mesch. "But that's just the start. We're continuing to expand our commercial rollout alongside Project Gigabit, extending infrastructure choice, multi-gigabit speeds, and unparalleled reliability to hundreds of thousands of additional premises in these regions."

CityFibre's announcement coincided with the publication of Point Topic's latest data on UK fibre coverage.

According to the research firm, FTTP reached 18.7 million premises at the end of the fourth quarter of 2023, up by 7.3 percent on Q3.

Incumbent Openreach understandably accounts for the lion's share – some 12 million premises – but such is the increasing maturity of the altnet market that Point Topic has begun digging into their numbers too.

CityFibre sits firmly atop this particular pile, with around 3 million ready-for-service premises in its fibre footprint, says Point Topic. Community Fibre sits in second place with 1.2 million, followed by Hyperoptic on 1 million.

The other important point to note from Point Topic's report is overbuild. In Q4 2023, 117 local authorities had three overlapping independent fibre providers, compared to 103 in Q3.

The combination of competition, overbuild, and rising costs due to inflation has raised questions about the survivability of all these players.

According to a Financial Times report last week, CityFibre is eyeing a central role in consolidating the altnet market.

Mesch said in the report that CityFibre has eyes on as many as five acquisitions over the next 24 months. His company is holding exclusive talks with two altnets, is working on offers for a further three, and has struck non-disclosure agreements with another six.

Under its current deployment plan, CityFibre aims to cover 8 million premises. But between Project Gigabit-backed network expansion, and the potential for mergers and acquisitions, its footprint could end up being considerably larger.

About the Author(s)

Nick Wood

Nick is a freelancer who has covered the global telecoms industry for more than 15 years. Areas of expertise include operator strategies; M&As; and emerging technologies, among others. As a freelancer, Nick has contributed news and features for many well-known industry publications. Before that, he wrote daily news and regular features as deputy editor of Total Telecom. He has a first-class honours degree in journalism from the University of Westminster.

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