Mark Collins, Co-Founder and Director of Strategy & Public Affairs of CityFibre, discusses fibre regulation, Openreach and why Sky quit its joint venture in York
Eurocomms.com: The UK government committed £400 million to pure fibre deployments and cut business rates in November; what impact do you think this will have on the ground?
Mark Collins: The government’s Digital Infrastructure Investment Fund (DIIF) is match funded by other financial institutions, so will actually amount to over £800 million.
In addition, there is £740 million of support for local government schemes.
The funds should be used to ensure competition to Openreach, by encouraging investment in open access full fibre infrastructure.
Managed correctly, the funds will be a catalyst for FTTP deployment commencing at scale in 2017.
Ofcom has said that the Openreach changes implemented in February have fallen short of what is needed. Does CityFibre agree with this?
Ofcom and Government agree that reforms to Openreach are important, however, they also both agree that competition to Openreach is critical if we are to achieve the policy objectives of full fibre and 5G.
Industry was clear – a wholesale only provider, investing in FTTP infrastructure is what the UK needs.
BT’s legal separation will still mean it’s a vertically integrated operator based on outdated copper infrastructure.
Competition to Openreach, will encourage investment in full fibre and will also spur more investment from Openreach too.
In November, Ofcom said that superfast demand is plateauing – are you worried by this?
No, there is no doubt that data growth will continue to grow exponentially.
We are building infrastructure capable of supporting and harnessing that growth over decades to come.
The UK lags behind all OECD nations in buildings connected directly to fibre – Spain have 83 percent FTTP while the UK has just two percent - we must catch up.
We are a service-based economy – our business must have access to the best digital infrastructure to compete on a global stage and this is now even more important in light of Brexit.
Matt Hancock has stated that a decade of investment is needed in full fibre and 5G. CityFibre is best placed to deliver on this ambition.
Last September you acquired new infrastructure from Redcentric taking your footprint to over 40 cities. Given your ambition is to reach 100 cities by 2025, are you at risk of overstretching yourselves?
In December 2015, CityFibre had less than 10 major metro fibre footprints.
A little over a year later, after our acquisition of KCOM’s national fibre assets and those from Redcentric combining with a number of greenfield city wins, we now have 42.
We have demonstrated our ability to grow both organically and inorganically at pace and we believe the goal of 100 cities by 2025 is ambitious but certainly achievable.
Demand for access to pure fibre infrastructure continues to rise at an unprecedented rate across all sectors.
What is more, the government and regulator’s commitment to increasing infrastructure competition and their articulation of the need for a ‘full-fibre future’ for the UK positions CityFibre perfectly to take full advantage.
As long as the demand remains, our efficiencies and ability to offer at scale will support our ambition to reach 25 percent of the UK market.
What was your reaction to Sky announcing that it was selling its shares in your FTTP joint venture in York?
The JV was established as a ring fenced trial to prove FTTH architecture, deployment costs and consumer take up.
The trial has been an overwhelming success but the JV structure was never intended to be the vehicle for a national FTTH roll-out.
CityFibre’s business model remains to be the builder of open access FTTP infrastructure.
This can then be consumed by ISPs to offer a new generation of services to homes and businesses.
It has taken two years to pass 14,000 premises in York; what do you say to those who say that is not a great advert for why FTTP can solve the UK’s infrastructure needs at scale?
The JV was a trial, and not a commercial deployment of FTTH at scale.
We believe it is realistic for the UK to aim for 80 percent coverage of FTTP by 2026.
CityFibre has the opportunity to be a major contributor to this goal, especially considering our current full fibre spine networks are now deployed in 42 cities.
The York trial proved the viability.