Broadband News

Liberty Fibre Networks Ltd applies for Code Powers

We don't normally cover what are fairly boring Ofcom Code Power consultations, since in itself having Code Powers does not mean you are going to build a massive FTTP network. Today though is a little different as Liberty Global via Liberty Fibre Networks Ltd is seeking code powers which make the job of rolling out telecoms infrastructure a lot simpler in the UK.

At this time Virgin Media has Code Powers from Ofcom and is very busy expanding its footprint through a mixture of coax network expansion and RFOG/FTTP network. 

So why have two companies building using Code Powers? 

The belief is that Liberty Fibre Networks Ltd will be launching in 2020 and will we believe acquire rights to the RFOG/FTTP network that Virgin Media currently retails and with the move of some electronic money create a Liberty Fibre Networks Ltd as the second largest full fibre operator behind Openreach (Virgin Media is the number 2 current due to its RFOG network being larger than the Hyperoptic footprint). This network which we believe is rapidly approaching a size of 500,000 premises passed will get expanded rapidly too and focus on areas where Virgin Media does not have a presence.

The timing also fits in nicely with the £5 billion full fibre programme the Government is sketching out now to deliver FTTP in the final 10% to 20% of the UK where existing commercial plans do not exist. A seperate company in the form of Liberty Fibre Networks Ltd that offers competitive wholesale access will tick a big procurement box and while many view Virgin Media as an urban operator under Project Lightning enough rural villages and small towns have been covered that they have the data on what the costs will be.

At this time it is not known how the £5 billion fund for full fibre will operate, i.e vouchers, one monolithic contract, regional contracts or local authority level again like the BDUK scheme but after the BT Group got the lions share of BDUK contracts, CityFibre is making the most of the LFFN funding it seems logical that Liberty Global will target the next set of funding. The Government goal is 100% Gigabit coverage by the end of 2025 but the funding as we understand things will be used for full fibre and while a small amount may be used for 5G since 5G needs large chunks of spectrum to deliver Gigabit speeds in reality rather than theory this means 8 GHz and higher bands which will have limited reach and thus be far from ideal in serving rural areas.

Even if we are wrong and Liberty Fibre Networks Ltd are not looking at the subsidy path, a very good reason to split and create a wholesale network is that if Virgin Media and Project Lighting was to continue it will not be able to avoid getting the attention of Ofcom and market regulation due to being the dominant Gigabit broadband provider in the UK.

Comments

Two networks with the same beneficial ownership would surely be treated as one when it comes to assessing issues like significant market power?

  • New_Londoner
  • 30 days ago

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