TALK.L Regulatory News (TALK)

TalkTalk launches new company FibreNation toaccelerate its full fibre plans

21st November 2018 - TalkTalk today announced an acceleration of its full fibre strategy, with the launch of a company to build a new broadband network for Britain. The company, FibreNation, will roll out faster, more reliable broadband to three million homes and businesses.

TalkTalk had previously announced its intention to invest in a new broadband network and today gave further details about its plans. It has established a new company, Fibre Nation, under an independent chair, to rollout full fibre infrastructure.

TalkTalk today confirmed that the first three towns to benefit will be Harrogate, Ripon and Knaresborough. The rollout builds upon TalkTalk's full fibre trial in York, which has seen the city benefit from Britain's fastest internet. The combined footprint will reach over 100,000 homes and businesses.

Full fibre is one hundred times faster than standard broadband and offers guaranteed speeds rather than variable ones. With speeds of 1000mbps, customers can download an HD film in just seven seconds, compared to 25 minutes on a standard connection.

The announcement comes as Government sets ambitious targets to increase the number of homes served by full fibre. Britain currently ranks almost last in Europe for full fibre availability. Just 5% of the UK homes and businesses have access to the technology, compared to over 80% elsewhere in Europe. The Government hopes 15 million homes and businesses will benefit from full fibre services by 2025.

TalkTalk will be the first customer on FibreNation, wholesaling access to the network to sell full fibre services to its customers. The arrangement builds on the successful York trial, where TalkTalk and Sky both wholesale access from the network. Sky will remain a wholesale customer of the new network in the expanded footprint.

TalkTalk is in discussions with potential partners, including Infracapital, to develop an appropriate long-term capital structure for FibreNation. TalkTalk and Infracapital will not be progressing on the basis of the Heads of Terms, announced in February 2018.

Today's announcement comes as TalkTalk continues to report strong growth. In interim financial results published today, the firm reported a seventh consecutive quarter of growth, having added over 100,000 customers over the last six months.

Tristia Harrison, Chief Executive of TalkTalk, said: "We're delighted to launch FibreNation and set out our plan to deliver world class broadband to three million homes and businesses. For too long, Britain has trailed the rest of the world when it comes to broadband speed and reliability. We're determined to change that and invest in the faster, more reliable broadband Britain deserves. This is just the beginning of our plans to be at the heart of Britain's full fibre future."

"We are very confident in the asset we have created in York and will continue discussions with potential partners to agree a capital structure that reflects that. In the meantime, we're accelerating our rollout plans."

Paul Reynolds, incoming Chair of FibreNation, said: "Having rolled out full fibre networks around the world, I'm excited to start building in Britain. This infrastructure will transform how families and businesses use the internet and I'm committed to ensuring it's affordable to all. I'm delighted to have two of the UK's largest internet service providers as customers and look forward to working with them to deliver the faster, more reliable broadband Britain needs."

Richard Cooper, Leader of Harrogate Borough Council said: "We are delighted that Harrogate has been chosen as one of the first towns in the UK to benefit from the roll-out of ultrafast broadband. This major investment will transform how residents use the internet and make the area even more attractive to those who want to start or grow a business."

County Councillor Carl Les, North Yorkshire's Leader said: "Investment in ultrafast fibre broadband is crucial for the economic and social vibrancy of our county. We will be coordinating with TalkTalk through our streetworks team to minimise disruption from the works and ensure this is delivered smoothly so residents can enjoy the benefits of faster, more reliable broadband."

Notes to editors

1. Appointments

As announced in May 2018, Paul Reynolds has been appointed to Chair the new company. He brings extensive experience of leading major telecoms and infrastructure businesses. As CEO of Telecom New Zealand, he led the rollout of full fibre services. Prior to that, he held senior roles at BT, including serving on the Board and led the creation of BT Openreach as a functionally separate business.

Neil McArthur will become Chief Executive of FibreNation. As the founder of Opal Telecom and former Managing Director of TalkTalk Technology, he brings extensive experience of building and managing scale telecoms networks. Charles Bligh has decided to pursue other opportunities and will not now join FibreNation.

2. Assets

York and other fibre assets wholly owned by TalkTalk will transfer to FibreNation. The joint venture originally set-up for the York trial and its assets are not being transferred.

3. About full fibre broadband

Full fibre (Fibre-to-the-premise) broadband provides a much faster and more reliable connection. It's passes through fibre optic cables all the way from the exchange to homes and businesses. In contrast, other broadband services, such as 'superfast' (Fibre-to-the-cabinet) still depend on copper connections, to connect individual homes.

Over a full fibre connection, customers can achieve speeds of up to 1Gbps -up to x100 faster than standard broadband speeds today. A two-hour HD film can be downloaded in seven seconds with full fibre, while it would take over 25 minutes over standard broadband.

Full fibre connections are also much more reliable and less prone to faults than standard copper technology. While copper lines can be impacted by poor weather and deteriorate over time, fibre network are longer-lasting, meaning a more reliable connection for consumers.

While full fibre networks are the critical infrastructure of the next 100 years, Britain trails the world in rolling it out. We have less than 5% coverage and lag behind current world leaders like South Korea (c.99%), and Japan (c.97%) - source: 'Future of Telecoms Infrastructure Review'.

4. Press contacts

Iain Wood, Director of Corporate Affairs and Regulation

Iain.Wood@talktalkplc.com 

07990 780519

Dafydd Wyn, Corporate Communications Manager

dafydd.wyn@talktalkplc.com 

07798704841