New VM O2 joint venture to reach 7m homes and to wholesale access to competitors

[1andrew1]

Telefónica and Liberty Global, who oversaw the merger of Virgin Media and O2 to create the enlarged group last year, will begin contacting potential investors this week but some informal discussions have already begun, according to a person with knowledge of the plan.

Virgin Media O2 is already upgrading its fibre network to around 15.5m premises by the end of 2028.

The new venture, which will be separate from this, is aiming to build out a new full-fibre network that will provide connectivity to an additional 7m homes, primarily in areas that currently only use copper lines and which are served by BT.

https://www.ft.com/content/5bbf83b8-...0-5a84f3c1b26f
Sky News article: https://www.msn.com/en-gb/money/othe...?ocid=msedgntp

[Pierre]

Originally Posted by 1andrew1

https://www.ft.com/content/5bbf83b8-...0-5a84f3c1b26f
Sky News article: https://www.msn.com/en-gb/money/othe...?ocid=msedgntp

This is just VM trying to get Liberty Networks off the ground again.

from this time last year:

https://www.ispreview.co.uk/index.ph...e-sibling.html

[1andrew1]

Originally Posted by Pierre

This is just VM trying to get Liberty Networks off the ground again.

from this time last year:

https://www.ispreview.co.uk/index.ph...e-sibling.html

That's actually from this time not one but two years ago! But your point remains valid.

Lots of talk about "upgrading" but when am I actually going to get fibre to my house.

[Pierre]

Originally Posted by Paul

Lots of talk about "upgrading" but when am I actually going to get fibre to my house.

If you’re already in a HFC area, anytime in the next 10 - 15 years as long as the money doesn’t run out.

Originally Posted by Pierre

If you’re already in a HFC area, anytime in the next 10 - 15 years as long as the money doesn’t run out.

Great, so I have to hope I last that long to even see it

[BenMcr]

Originally Posted by Pierre

If you’re already in a HFC area, anytime in the next 10 - 15 years as long as the money doesn’t run out.

It's supposed to be in the next 6 years - by 2028

https://www.ispreview.co.uk/index.ph...ull-fibre.html

[Pierre]

Originally Posted by BenMcr

It's supposed to be in the next 6 years - by 2028

https://www.ispreview.co.uk/index.ph...ull-fibre.html

I’m happy to be wrong. It’s 2022 and the actual management team to deliver this has only just been assembled. They are trialling it now in 3 areas. It will be several months before it is ramped up to full scale, I doubt very much they can overbuild all of the HFC in just over 5 years.

There’s a misconception that the overbuild will be quick and relatively inexpensive because of the existing VM duct network. If the existing HFC fibre & copper cables weren’t in-situ that may be more the case but the HFC & FTTP must coexist. There are lots of places where the duct are full, so new ducts will be required. Some existing cabinets can be converted for dual use but mostly new cabinets will be required.

I’m probably being pessimistic with 10yrs, but just over 5yrs? Not a chance.

VM will still invest in DOCSIS, which will deliver 10G over HFC, so if you have to make decisions on where to spend money. They will continue to spend on FTTP network expansion as that is new business and customer expansion - that’s a given. But if we’re 2-3 years into Mustang and It’s proving to be more expensive than envisaged and spend decisions need to be made. You’ll scale back Mustang (not stop it) and push on with NetEx as that is giving you a better return on your money.

[1andrew1]

Originally Posted by Pierre

I’m happy to be wrong. It’s 2022 and the actual management team to deliver this has only just been assembled. They are trialling it now in 3 areas. It will be several months before it is ramped up to full scale, I doubt very much they can overbuild all of the HFC in just over 5 years.

There’s a misconception that the overbuild will be quick and relatively inexpensive because of the existing VM duct network. If the existing HFC fibre & copper cables weren’t in-situ that may be more the case but the HFC & FTTP must coexist. There are lots of places where the duct are full, so new ducts will be required. Some existing cabinets can be converted for dual use but mostly new cabinets will be required.

I’m probably being pessimistic with 10yrs, but just over 5yrs? Not a chance.

VM will still invest in DOCSIS, which will deliver 10G over HFC, so if you have to make decisions on where to spend money. They will continue to spend on FTTP network expansion as that is new business and customer expansion - that’s a given. But if we’re 2-3 years into Mustang and It’s proving to be more expensive than envisaged and spend decisions need to be made. You’ll scale back Mustang (not stop it) and push on with NetEx as that is giving you a better return on your money.

As an outsider, I must admit I struggle to see the benefit of running two networks in parallel unless you don't want to take the short-term hit of moving customers over to the new network. Double costs, double confusion, surely? Unless you envisage different ownership structures for the two networks.

But I speak as someone outside the sector and this is VM O2's area of expertise and not mine!

[Pierre]

Originally Posted by 1andrew1

As an outsider, I must admit I struggle to see the benefit of running two networks in parallel unless you don't want to take the short-term hit of moving customers over to the new network. Double costs, double confusion, surely? Unless you envisage different ownership structures for the two networks.

But I speak as someone outside the sector and this is VM O2's area of expertise and not mine!

You have to, there’s no other choice. You can’t give your customers an either/ or ultimatum.

Give them a better option and they will move, when enough have moved announce the shutdown of the HFC ( I’ve been advised 2045 total and absolute nationally, so obviously it will start area by area many years before that) and the remainder will have to move.