UK business centres to get new fibre next year

Neos Networks is making a lot of noise about its new full fibre metro networks in a handful of major UK cities, but it hasn’t actually launched any of them yet.

The UK altnet and business services provider is working hard to add full fibre to its portfolio, and this week talked up the benefits that infrastructure will bring to businesses in Birmingham, Manchester, Liverpool and London…eventually. The firm says it is on track to go live with its first fibre access network in Liverpool at the start of next year, with Birmingham and Manchester to follow from mid-year, and the City of London scheduled to come on stream in February 2023.

Launch in the first three cities will provide the option of fibre connectivity to almost 10,000 business, while the London deployment will add a further 23,000.

Rolling out its own last mile fibre means Neos Networks will no longer have to rely on third-party connectivity, and will, it claims, be able to offer lower costs and better timescales to its business customers. “By connecting directly into a high-speed core network, the new Metro Access Networks will also improve choice and connectivity for national companies looking to better integrate their regional centres,” Neos added.

As the above suggests, Neos Networks might be a newcomer to the fibre access market, but it has a lengthy pedigree in the UK business services space. It was founded in the late 1990s under its current name, but became known as SSE Enterprise Telecoms following its acquisition by energy company SSE Group in 2003. SSE’s decision to sell off a 50% stake to European infrastructure investment outfit Infracapital nearly three years ago triggered a business transformation plan and ultimately a rebrand: Neos Networks adopted its former name once again earlier this year.

And now it is keen to make that name in the fibre market.

“The UK lags behind many of its European neighbours in terms of business fibre access, but with Project Edge we aim to help UK businesses, starting in Liverpool, Birmingham and Manchester as well as those in the capital, to catch up and truly compete, not just on a level playing field, but on one tilted in their favour,” said Sarah Mills, MD of Wholesale and Smart Infrastructure at Neos Networks. Project Edge is essentially the operator’s network rollout plan, first detailed as long ago as 2013.

Unlike many of the myriad fibre builders that have sprung up in the UK in recent years – and continue to do so – Neos Networks is choosing major business centres for its starting point in full fibre. While others look to bring residential offerings to the underconnected in rural areas and the like, Neos is sticking to its roots. And improving fibre connectivity for businesses could well prove to be a money-spinner.

However, this approach does not come cheap or without risk. As LightReading points out, Neos has spent around £75 million only on unbundling exchanges and posted a net loss of the best part of £32 million in the most recent financial year. Those figures do not suggest the likelihood of quick returns and, as our sister publication concludes, its investors may need to be in it for the long haul.

Happily for Neos and others like it, for the most part they are. The investment community’s love affair with fibre is not cooling yet.