Original article ISPreview UK:
The CEO of alternative UK broadband operator F&W Networks‘ (Fibre and Wireless), José Luis San Martín, has today spoken to ISPreview, as part of a new interview, about his ambition for the company to ramp-up their roll-out of full fibre (FTTP) lines “once the market stabilises and financial conditions improve“. But they also remain “open” to discussions over consolidation.
F&W has so far managed to extend their gigabit-capable broadband network to cover 410,000 UK premises read-for-service (Feb 2024 data) across 30 locations in parts of South East of England, such as Greater London, Buckinghamshire, Hampshire, Hertfordshire, Oxfordshire, Surrey, and West Sussex. The operator is also home to a growing customer base of over 30,000 (up from 25,000 in August 2024).
NOTE: F&W is backed by Maestro Capital and Foresight Group LLP. José Luis San Martín, CEO, has over 25 years of expertise in establishing corporate governance structures and scaling organisations, including a decade spent as an ExCo member at various financial institutions.
The network, which is supported by a number of ISPs (Hey! Broadband, Octaplus, Link Broadband, Home Telecom and more), has made a lot of progress in recent years. But on the flip side they’ve also been impacted by wider market conditions (i.e. high interest rates, rising build costs and competition), which in 2023 caused F&W to scale-back some of their builds and cut jobs as part of a shift in strategy to focus on greater commercialisation (here).
The approach is one that many other altnets in the market have since mirrored, but José told ISPreview that they “fully anticipate ramping up our network build again” in the future, albeit not until “the market stabilises and financial conditions improve“. Today UK interest rates remain stubbornly high (4.5% in early March 2025), while investors have become more risk averse and José added that recent tax rises “do add pressure“.
Despite the pressure, F&W is “committed to remaining independent and growing organically“, although José hasn’t shut the door on the idea of merging with another operator. “Should the right opportunity arise, we’re always open to discussions that align with our long-term vision,” said José.
In the meantime, the operator is focused on growing the take-up of their network, which has its own challenges. José highlights how “many consumers still don’t fully understand the advantages of fibre over copper” and hopes that Ofcom’s forthcoming market review will lead to “more clarity around regulatory frameworks that encourage greater investment“. In addition, he hopes that the government’s efforts to simplify planning laws will provide “more incentives to encourage the deployment of full-fibre broadband in challenging areas“, although we’ve yet to see much detail on the new laws.
The full interview below also touches on other competitive issues, such as those that may arise from Openreach’s pricing strategy. Not to mention the possibility of greater infrastructure sharing between rivals and the potential impact of Virgin Media’s move to open their existing broadband network up to wholesale, which José said “must be subject to strict regulatory oversight to maintain a level playing field for smaller altnets“.
The F&W Networks Interview
1. Firstly, can you provide an updated summary on F&W’s current network coverage (premises passed), customer take-up and total level of funding/investment?
José Luis San Martín said:
F&W Networks, with help from our Hey!Broadband brand, has reached 30,000 customers, a key milestone highlighting the strong growth we’ve seen. We are primarily focused on the South of the England, where our network footprint is growing steadily, with a strategic concentration in this area to maximise operational efficiency and ensure excellent service delivery.
In terms of funding, F&W has made significant investments to drive network expansion and infrastructure, but we continue to prioritise capital efficiency to deliver value. Our focus is on building strong partnerships with ISPs and leveraging our wholesale capacity to expand our network’s reach even further.
We recently announced our latest partnership with Gigabit IQ, which joins nine other brands in helping to bring reliable, gigafast full-fibre broadband to remote communities across England.
2. What is the situation like for F&W today after the switch in 2023 to focus on commercialisation (here) and do you envisage a time when the rate of build may ramp up again?
José Luis San Martín said:
The shift to focus on the commercialisation of our existing network has been crucial in navigating the current competitive and economic landscape, particularly with rising build costs and interest rates. However, our long-term vision remains ambitious, and once the market stabilises and financial conditions improve, we fully anticipate ramping up our network build again.
Right now, we’re strategically positioning ourselves to partner with more ISPs, which will, in turn, expand our customer base. This commercial focus also makes the case for increased build in the near future, especially as demand for full-fibre services continues to rise.
3. Improving consumer take-up is a key focus for altnets right now, not least as it helps to prove their business case and keeps investors happy (as well as potentially attracting new investment). What more do you think altnets, or the wider industry, need to do on this front to generate better adoption?
José Luis San Martín said:
Consumer adoption is key for altnets, and while we’re seeing strong growth in the South, a lot more needs to be done to raise awareness about the benefits of full-fibre broadband. Education is critical. Many consumers still don’t fully understand the advantages of fibre over copper, and I think as an industry, we need to do more to communicate those benefits, both in terms of speed and reliability.
Additionally, more aggressive incentives and clearer value propositions from ISPs will help drive take-up, as consumers are still sometimes hesitant about switching providers. The collaboration between ISPs and wholesalers like us is key to achieving this.
4. I guess we can’t talk about the current climate without touching on the topic of consolidation. Does F&W now see itself more as being an attractive prospect for being consolidated by a bigger fish, or are you likely to focus on remaining independent, while potentially raising fresh investment as interest rates come down – perhaps even doing a little consolidation of your own?
José Luis San Martín said:
F&W Networks has always been focused on growth through partnerships, particularly with ISPs, and that strategy will continue. While consolidation is always a part of the conversation in the market, we’re in a unique position where we’re very committed to remaining independent and growing organically.
We have a clear focus on building value through capital efficiency, expanding our ISP partnerships, and growing our customer base. However, should the right opportunity arise, we’re always open to discussions that align with our long-term vision. But for now, the focus is on expanding and adding to our roster of ISP partners.
5. The country recently welcomed a new government, which on the one hand has delivered various tax rises (increasing costs in certain areas), while on the other has committed to making a “renewed push to fulfil the ambition of full gigabit and national 5G coverage by 2030” and unblocking planning.
How do you think the new government is doing, with respect to supporting altnets like F&W on this front, and what more would you like to see them do?
José Luis San Martín said:
The new government’s focus on full gigabit coverage and national 5G ambition is certainly positive for the industry. However, the recent budget signals — such as tax rises — do add pressure on operators. We’d like to see more clarity around regulatory frameworks that encourage greater investment in the broadband sector, especially in urban areas where competition is fiercer.
At the same time, simplifying planning laws and providing more incentives to encourage the deployment of full-fibre broadband in challenging areas would be welcome. F&W is committed to being part of the solution, but we also want to see more tangible support from the government to ensure that altnets can thrive alongside larger players.
6. Speaking of the new government, we’ve recently seen a lot of talk about some of the remaining funding for the £5bn Project Gigabit broadband roll-out potentially being directed to help fill in some of the slowspots for coverage that exist in urban areas (the scheme has previously been laser focused on rural areas).
The expectation is that this may be used to support an expanded Gigabit Broadband Voucher Scheme (GBVS). Given that F&W Networks serves a mix of different areas, what are your thoughts on this idea, and do you think Project Gigabit’s funding should remain ring-fenced for use in poorly served rural areas?
José Luis San Martín said:
Project Gigabit’s original focus on rural areas has been important, but now there’s a clear case to be made for expanding into underserved urban areas as well. These areas often have pockets where broadband access is poor, and full-fibre services would make a significant difference to both consumers and businesses. F&W Networks operates in a mix of areas, and we’d welcome further funding for projects that can improve service in urban settings, provided that the funding is used strategically to complement existing coverage and truly fill the gaps in those locations.
Please flick over to Page 2 in order to finish reading the interview.
