Virgin Media is sitting firmly in the middle of the rumour mill, with reports suggesting the team is considering opening-up its network as a wholesale connectivity competitor to Openreach.
For the majority of ISPs in the UK, there is very little option aside from working with Openreach. This position lead to a prolonged battle between Openreach parent company BT and the UK Government in an effort to separate the wholesale business from the group, and while the dust has settled, most feel the outcome is rather unsatisfactory. However, according to The Telegraph, Virgin Media is considering creating competition in this segment.
Should the move turn out to be true, it would be welcomed by many of the ISPs around the country. That said, Virgin Media and its parent company Liberty Media are keeping coy on the situation.
“We have the best broadband network in the UK and everyone knows it,” a spokesperson said. “We’re not surprised by this speculation but have no comment.”
While it is a slightly playful comment which will bring a smile to some faces, the firm has stopped short of out-rightly denying the report. This might lead some to believe there is an element of truth to the reports, others will simply suggest this is PR 101.
Although Openreach is still in an incredibly dominant position when it comes to the wholesale business, pockets of competition are emerging. CityFibre is leading the charge here, using an injection of funds from Goldman Sachs to built on its fibre footprint across the UK. CityFibre now has fibre infrastructure projects across 51 towns and cities, providing active and dark fibre services, most notably to Vodafone which is building its presence as an ISP.
The idea of emerging competition does seem to be spurring the sluggish Openreach into action, as the team has announced one million homes now fall into its fibre footprint. Openreach, and BT as the guiding hand, has often been criticised for lack of foresight when it comes to connectivity. For years, the team pursued fortunes via G.Fast while the industry was demanding fibre, with this inaction perhaps creating the fuel for the emerging competition.
While CityFibre still has the tag of a plucky outside bet, Virgin Media would certainly provide more food for thought. With 14.4 million homes passed throughout the UK, roughly 50% of households, it is a genuine alternative for ISPs who have nationwide ambitions.
We suspect such conversations are taking place behind closed doors in the Virgin Media offices. The UK infrastructure wholesale market is certainly primed for a shake-up, and Virgin Media has the footprint to capitalise.