Despite a tough financial year, an extra five million premises has been added to BT’s deployment of FTTP broadband, creating thousands more jobs
BT Group has increased and expanded its build out of Fibre to the Premise (FTTP), after a year of Coronavirus lockdowns has demonstrated the importance of speedy broadband connectivity.
The expanded deployment of FTTP comes after BT posted its full year results for the past 12 months, during which Openreach staff and engineers were hard pressed to keep the UK’s communication channels functioning during that difficult period.
In March the UK regulator Ofcom agreed the pricing and other conditions needed for BT to commit £12 billion of its own money for the rollout of FTTP to 20 million homes or businesses by the mid- to late-2020s.
BT then confirmed it will “get on and build like fury” to deliver fibre to the premise (FTTP) to 20 million premises.
The government also in Match announced the first stage of its £5 billion plan to get ultra-fast broadband, or fibre to the premise (FTTP), to the most difficult and remote British homes and locations.
But now on Thursday BT has said that it will increase its full fibre (FTTP) build by 5 million premises, with the new target of 25 million premises to be reached by December 2026.
The carrier said this extended target will support an additional 7,000 jobs, and BT is to explore options for a joint venture to help fund the additional 5 million premises.
BT said in the last year Openreach passed a record 2 million premises with FTTP, and Openreach now believes that it has the capability to reach around 4 million premises a year, with immediate effect.
“BT is already building more full fibre broadband to homes and businesses than anyone else in the UK,” said BT chief executive Philip Jansen. “Today we are increasing our FTTP target from 20 million to 25 million homes and businesses to deliver further value to our shareholders and support the Government’s full fibre ambitions.”
“This has three massive benefits: it allows us to go faster, beefing up our capacity to build fibre to households and businesses; it allows us to go further, getting fibre to more people including in rural communities, and; it will help fuel UK economic recovery, with better connectivity and up to 7,000 new jobs,” said Jansen.
Net profit fell 15 percent to £1.47bn from £1.7bn a year previously, and annual revenues also fell 7 percent to £21.3bn from £22.9bn a year previously.
But Jansen was optimistic at the results after the Coronavirus pandemic.
“BT comes out of this challenging year as a stronger business with an even greater sense of purpose,” said Jansen. “Our fantastic colleagues have shown the true colours of BT – delivering resilient connectivity, supporting families and businesses and helping to underpin the heroism of the NHS.”
“A number of uncertainties have now been removed,” he added. “The Wholesale Fixed Telecoms Market Review, 5G spectrum auction and the Government’s cash tax super-deduction give us the green light to build the UK’s next generation digital infrastructure even faster.”
“After a number of years of tough work, and as we look to build back better from the pandemic, we’re now pivoting to consistent and predictable growth,” he added. “We are building a better BT for our customers, for the country and for those who work for this great company – now and in the future.”
And Clive Selley, CEO of Openreach was also keen to stress the division has been encouraged by the FTTP extension from BT.
“We’re proud that BT Group is increasing its ambition for Openreach,” said Selley. “”We’re also encouraged by the demand we’re seeing – having just connected our one millionth customer. Allied to our experience and innovation in scaling up the build, this gives us confidence that we can reach 25 million premises by December 2026 at world-class cost points.”
“Research shows how Full Fibre can make us more productive, competitive and green as a nation, and it can enable a million people to return to the workforce, helping to level up the UK,” Selley added. “So we believe the time is right to capitalise on that potential and, having made this technology available to 4.6m premises already, we expect to reach a peak build rate of four million premises a year.”
“It’s all systems go for a Full Fibre future here at Openreach,” he concluded.
And a telecom expert has also noted that while BT’s results were down, it now has the much needed investment certainty going forward to allow it to invest in the FTTP deployment.
“The announcement follows Ofcom’s crucial recent decision not to impose caps on the wholesale prices fibre operators can charge for access, for at least ten years,” noted Kester Mann, director, consumer and connectivity at tech analyst house, CCS Insight.
“BT has always maintained that its fibre targets were contingent on the right regulatory conditions that would enable it to make a fair return. It is now living up to its word,” said Mann. “After an intensely challenging few years, BT finally has some wind in its sails. Its financial results may have proved another let-down, but the investment certainty it has long craved, combined with a positive outcome at the recent 5G spectrum auction and encouraging take-up on its existing fibre footprint suggest brighter times may finally be ahead.”
“The fibre announcement is welcome news for the UK’s recovery from Covid-19,” Mann added. “The pandemic has underlined the value of high-quality connectivity to support households and businesses. It will be an important factor in restoring the economy and bridging the digital divide so starkly highlighted over the past year.”
“BT made no update on its recent announcement that it is considering selling a portion of its BT Sport business,” he noted. “The company faces a dilemma familiar to many other large telecom operators: does it sharpen its focus on fixed-line and mobile networks to offer best-in-class connectivity amid questionable long-term return, or place bold bets on fuelling new revenue from adjacent areas such as sport. The decision to ramp up on fibre could be a strong clue to where its priorities lie.”