Mobile operator and ISP Vodafone UK has today published their Q2 FY25 financial results, which reveals that their fixed line broadband base grew again to total 1.477 million customers (up by 50k in Q2 vs 44k in Q1) and their mobile base fell again to total 18.474 million (down by -93k in Q2 vs -71k in Q1).

In terms of their UK fixed broadband services, the operator has continued to report strong growth, with a quarterly addition of 50,000 customers – thanks in part to being widely available across both Openreach’s and CityFibre’s national networks. The provider’s full fibre FTTP coverage can now reach a combined total of 17.3 million UK households (up from 16.2m last quarter).

As for their mobile base, Vodafone reported a quarterly fall of -6,000 in Pay Monthly customers (vs a decline of -29k in Q1) and a decrease of -87,000 in Prepaid / PAYG customers (vs -42k). But it should be noted that the sharper fall this time around was fuelled by a large quantity of “low-value contract disconnections in Business and a reclassification of part of the mobile customer base to IoT“.

Finally, quarterly mobile broadband (data) usage across their UK network increased to 617,397 TeraBytes (up from 602,320 TB last quarter). The figures for this seem to have all been re-done this time around, which suggests either a change in methodology or that they’re including something that was previously excluded (the re-done figures are much higher than before).

Margherita Della Valle, Vodafone Group CEO, said:

“We continue to make good progress on our strategy to change Vodafone. The approval processes for our transactions in the UK and Italy are nearing conclusion. These will complete our programme to reshape the group for growth. We are also investing in Germany to strengthen our market position and taking steps to expand our B2B capabilities.

As we move through this year of transition, our results in the first half have been consistent with our expectations and we are reiterating our full year guidance. We grew service revenue by 4.8% and Adjusted EBITDAaL by 3.8%. We delivered good performances across our markets, with the exception of Germany, where we have been impacted as expected by the TV law change.

I am confident that the actions we are taking will deliver growth for Vodafone this year and a further acceleration into FY26.”

The report doesn’t mention much about their shortly to be approved merger with Three UK, but Vodafone does confirm that they expect the deal to close in “early 2025” and this would be consistent with the CMA granting final approval within the next few weeks. Finally, the operator saw their quarterly UK service revenue reach €1,462m (up from €1,429m in the previous quarter). The full report is here (PDF).

Mobile operator O2 (Virgin Media) has today marked an important milestone by switching on the UK’s first publicly funded “Total Not Spot” (TNS) 4G (mobile broadband) mast site on South Uist in Scotland, which forms part of the £1bn industry-led Shared Rural Network (SRN) programme and its efforts to extend mobile coverage into remote rural areas.

The SRN – supported by £501m of public funding and £532m from operators – involves both the reciprocal sharing of existing masts in certain areas and the demand-led building and sharing of new masts in others between the operators (MNO). The target is to extend geographic 4G coverage (aggregate) to 95% of the UK by the end of 2025, which falls to 84% when only considering the areas where you’ll be able to take 4G from all providers.

Most of the early work on the SRN has typically involved private investment from the main mobile network operators, although over the past year we’ve also seen government-funded mast upgrades taking place in other parts of the UK (examples here, here and here). But the latest development reflects the first publicly funded SRN Total Not Spot site to be switched on, which kicks off the second phase of the roll-out programme.

Just for some context. The SRN includes two key targets. The first involves the delivery of industry funded coverage improvements in Partial Not-Spot (PNS) areas (i.e. areas that receive coverage from at least one operator, but not all), which Ofcom says has already extended 4G to cover 88% of the UK’s landmass (here).

The second target involves tackling Total Not-Spot (TNS) areas by early 2027. Just to be clear, Ofcom’s licence obligations commit each individual operator to increase its 4G coverage to 88% of the UK’s landmass by June 2024 – rising to 90% by January 2027 – with these individual obligations supporting the overall target of 95% by December 2025.

The mast on South Uist, which all operators can harness, is thus part of that second phase of work (TNS) and will offer “reliable 4G and broadband” to people in the villages of Balivanich, Grimsay, Liniclate, Benbecula, The Hebridean Way and more than 30km of the A865 for the first time.

Chris Bryant, UK Telecoms Minister, said:

“For too long, island communities in Scotland have struggled to get online while on the go. This milestone for the Shared Rural Network means vast swathes of Uist are now covered by 4G for the first time, boosting productivity for local businesses and safety for those in remote areas.

South Uist is the first location to benefit from this new phase of the programme, which targets areas with no 4G coverage at all. We will continue to work with the mobile network operators to maximise the benefits of this rollout for local communities while preserving areas of natural beauty.”

Jeanie York, CTO of VMO2, said:

“We are extremely proud to continue our industry-leading work which is bringing reliable mobile coverage to rural communities across the UK for the very first time. This new site in South Uist, which will bring mobile signal to local residents, major roads and visitor attractions which were previously disconnected, illustrates how the total not spot programme can transform lives when we invest in the right locations. Targeted investment like this will provide the greatest benefit to consumers, help close the rural/urban divide and deliver growth across the country.”

O2 added that they faced “significant challenges” building the remote site, with bad weather conditions making delivery and access to the island exceptionally difficult. But the operator says they worked closely with build partner, WHP Telecoms, to overcome these challenges and deliver the new site in just six weeks.

The government and the UK’s four mobile network operators ultimately aim for the SRN to provide coverage to an additional 280,000 premises and 16,000km of the UK’s roads.

The Building Digital UK agency and Department for the Economy (DfE) have this week begun the supplier procurement phase of their future Project Gigabit broadband roll-out for Northern Ireland, which values the contract at up to £81m (state aid) and could potentially achieve almost universal coverage of 1000Mbps+ broadband speeds.

So far a mix of commercial builds and some state-aid funded deployments under the £197m Project Stratum scheme have already helped to extend the coverage of fixed gigabit-capable broadband ISP networks to 96.42% of premises in Northern Ireland (Thinkbroadband’s latest figure), which falls to 95.91% when only looking at Fibre-to-the-Premises (FTTP) technology.

Suffice to say that gigabit coverage in NI is already well ahead of the rest of the United Kingdom, and Ofcom predicts it will reach 98-99% by May 2027 (here). Despite this, the government’s £5bn Project Gigabit programme has previously forecast that up to around 60,000 premises may still need help to access a gigabit network (here).

In order to tackle this challenge, the UK government’s Project Gigabit programme has been preparing to launch a related procurement, which formally kicked off this week with the publication of a new contract notice. The notice, seen by ISPreview, doesn’t provide a lot of new information but does indicate that the 10-year contract has a potential value (public funding) of between £34.647m (Initial Scope) and up to a maximum of £81m.

The figures suggest, at least to us (assuming a maximum award of near to £81m), that the contract for this would probably reach around 40,000 poorly served premises. Furthermore, additionality (i.e. where the build of a new network via state aid also allows commercial operators to make viable build models for previously unviable premises) could then conceivably in-fill the remaining premises to achieve universal or near to universal coverage.

The DfE has called on any tenders for this contract to be received by 16th December 2024 and prior market engagement probably means they may already have a pretty good idea of the potential bidders. The main fixed line operators currently active in Northern Ireland are Openreach (BT), Virgin Media (O2) / nexfibre, Netomnia and Fibrus.

However, both VM/nexfibre and Netomnia have tended to be more urban focused and haven’t won any Project Gigabit contracts before, which leaves Fibrus and Openreach as the likely contenders. One catch here is that Fibrus, which has already largely delivered on their prior Project Stratum contract, have recently been scaling back their builds and cutting jobs (here) – potentially making it harder for them to bid on this one. Time will tell.

Neos Networks, which operates one of the biggest 34,000km long business fibre networks in the UK – spanning 550 exchanges, 90+ data centres and 676 Points of Presence (PoPs), has today signed a new deal to harness the 100Gbps capable full fibre network that has been built by ISP Vorboss in London.

Just to recap. Vorboss recently completed the deployment of a 500km dedicated point-to-point fibre optic network across Central London (covering most of zones 1 and 2), which we’re told is enough to potentially connect all commercial buildings in the area to their direct internet access and Ethernet network. The operator has since switched their focus to growing take-up.

The deal being announced today means that Neos Networks customers will also be able to access the Vorboss network on its LIVEQUOTE platform to clearly see the prices of available services that meet their requirement. Apparently, Neos Network customers will be able to harness Ethernet service speeds of up to 10Gbps via this network.

Lee Myall, CEO at Neos Networks, said:

“We’re excited about our collaboration with Vorboss, which builds on our long-standing commitment to delivering high-capacity, reliable connectivity across the UK. By combining our extensive nationwide network with Vorboss’ advanced London infrastructure, we’re increasing the options for businesses demanding top-tier connectivity. This deal allows us to extend our reach in the capital, providing more organisations with access to the robust, secure networks they need.”

Tim Creswick, CEO of Vorboss, added:

“Enabling the London last-mile for Neos will pitch our network directly against the legacy players in London, and will show just how strong we are in performance, delivery timeframes, and value. The Neos LIVEQUOTE portal is a great tool for giving a transparent view of the services available, and we look forward to competing on that basis.”

Events

This week saw Total Telecom’s Connected Germany conference make its triumphant return to Munich

The two-day event saw more than 1,200 attendees come togther from across the country to discuss the biggest challenges facing Germany connectivity industry. From the country’s rapidly accelerating fibre and 5G rollouts,

The event’s extensive agenda featured over 150 speakers representing every corner of Germany’s digital economy, from network builders and operators, to the public sector and vertical industries.

150 exhibitors

News 

The deal follows a similar one with Verizon last month 

UScellular has announced a deal to sell part of its spectrum assets to AT&T for $1.018 billion. This transaction is part of the company’s strategy to monetise spectrum not included in its earlier agreement with T-Mobile. AT&T joins Verizon and other carriers in purchasing spectrum from UScellular as the company continues to streamline its holdings. 

Following this sale, UScellular will have sold around 55% of its spectrum assets, excluding mmWave. Including previous sales, the company has now monetised approximately 70% of its total spectrum. The remaining spectrum includes key low and mid-band frequencies, including valuable C-band spectrum, which is crucial for 5G expansion. 

“We are pleased with the significant value that will be realized in the various transactions recently announced,” said Laurent C. Therivel, President and CEO in a press release. 

“This agreement adds a fourth mobile network operator, in addition to T-Mobile, to the list of those whose subscribers will benefit from the sale of our spectrum licenses.  As with the other mobile network operators, we are confident that AT&T can put it to productive use in communities throughout the U.S.  Furthermore, the terms of the agreement will ensure that there will be continued, uninterrupted service for UScellular customers in the interim,” he continued.

The transaction involves 1,250 million MHz-Pops of 3.45 GHz spectrum and 331 million MHz-Pops of 700 MHz B/C block licenses. 

However, the transaction will only close once UScellular’s ongoing sale of wireless operations to T-Mobile is completed, and regulators have given the deal the green light. The deal has already been approved by TDS, UScellular’s majority shareholder. Some of the licenses involved in this sale are owned by a third party, and UScellular is in the process of acquiring those assets.  

This move is part of UScellular’s broader strategy to optimise its spectrum portfolio and strengthen its position in the competitive wireless market. Last month, UScellular reached a $1 billion agreement with Verizon to sell part of its spectrum holdings. The deal includes spectrum licences in the 850 MHz band, as well as AWS (Advanced Wireless Services; i.e., 695–2200 MHz) and PCS (Personal Communications Services; i.e.,1850–1995 MHz) licenses.   

All of these transactions hinge on the closing of UScellular’s sale of wireless operations and select assets to T-Mobile, which was announced earlier this year. T-Mobile is set to acquire the majority of UScellular’s wireless operations, including its customers, retail stores, and around 30% of the company’s spectrum holdings, for $4.4 billion. 

Join us at next year’s Connected America, 11-12 March in London. Get discounted tickets here!

Also in the news:
VMO2 launches UK’s first 5G standalone small cells in Birmingham
BT says Labour’s budget will cost company £100m
Vodafone Spain and Telefonica complete FibreCo deal 

Internet provider Origin Broadband, which is a trading name for Origin Communications and OB Telecom (TalkTalk), appears to have re-opened their order system to new broadband customers after closing it some months ago. The ISP is currently only available to those covered by Openreach’s national network.

An Origin spokesperson told ISPreview: “Origin offers a broad range of connectivity solutions that can support the digital needs of any home. As part of that, we are carrying out a small-scale sales trial focused on the value-end of the broadband market.”

The trial currently appears to be harnessing Openreach’s network via PlatformX Communications (PXC), which was previously known as the wholesale division of TalkTalk. In terms of pricing, Origin’s “trial” FTTP packages seem to start at £26 per month (reduced from £40) for 100Mbps+ (20Mbps upload) and that rises to £45 (reduced from £60) for their top 950Mbps (110Mbps upload) tier. Both FTTC and ADSL2+ packages are also available in certain non-FTTP locations.

Fixed wireless operator and broadband ISP Connexin has today called on the UK government to expand its focus beyond full fibre and 5G mobile by recognising Low Power Wide Area Networks (LPWAN / LoRaWAN), which are often used to help connect small IoT style sensors and meters, as “critical infrastructure“.

Connexin, which is also involved in its own roll-out FTTP broadband technologies, is separately a member of the LoRa Alliance (LoRo = Long Range), a membership organisation where industry experts collaborate and share experiences to promote and drive the success of LoRaWAN wireless networks. As part of that they recently launched the “Liberté, Egalité, Connectivity: LPWAN for All” movement to help encourage the UK gov to recognise LPWAN as critical infrastructure.

Sites or networks designated as Critical National Infrastructure (CNI) are those facilities, systems, sites, information, people, networks and processes, necessary for a country to function and upon which daily life depends. It also includes some functions, sites and organisations which are not critical to the maintenance of essential services, but which need protection due to the potential danger to the public (e.g. civil nuclear and chemical sites).

In short, being part of CNI would afford such networks greater protection, much like the energy supply, water supply, transportation, health and other telecoms networks.

Jason Legget, Lead for Connexin’s Public Sector & Enterprise IoT Solutions, said:

“We’re looking to work with UK partners and businesses who see LPWAN as a vital part of their operations. We want to create solutions for customers that build evidence of LPWAN’s benefits and drive confidence in it as a solution. We also want to bring together consortiums by working together with the LoRa Alliance to agree on the right policy message to deliver to our new Government.”

Connexin’s viewpoint here is that if governments continue to only talk about 5G and FTTP as the answer for all our connectivity needs, then “deployment and adoption of IoT solutions will continue to be frustrated” (i.e. commercial investment will slow and the benefits such as innovative new service models and important operational efficiencies will not be realised at a pace that is needed). It perhaps doesn’t help that wireless LPWAN networks have always been more in the background and don’t grab the same sort of headlines, despite having plenty of uses and growing in popularity for IoT connectivity.

Broadband and mobile operator Virgin Media and O2 (VMO2) have today become the latest ISP to adopt Ofcom’s new guidance on inflation-linked annual broadband price rises. In practice, this means that new and re-contracting (upgrading) customers will be hit by a flat price increase of up to £3.50 (monthly) each April.

The new policy reflects the regulator’s earlier move to BAN broadband ISPs and mobile operators from doing mid-contract price hikes that are linked to confusing inflation and percentage-based changes (here). BT, Plusnet, EE, TalkTalk, Vodafone and others have already adopted a similar approach to the one that Virgin Media are now deploying.

However, Ofcom’s change was never designed to stop mid-contract hikes completely (it’s more about making future pricing clearer and simpler), but it did require providers to tell customers precisely what any future price increases would be when they sign-up (“in pounds and pence“). This rules out changes to core subscription prices that are linked to unknown future inflation values or percentages.

In short, new and re-contracting Virgin Media customers will see their prices rise by £3.50 a month effective each April, while O2 customers will see their airtime bill increase by £1.80, effective each April (their monthly device payments remain frozen at a fixed price). Customers on VMO2’s Social Tariffs and Talk Protected landline services are exempt from price increases.

Elsewhere, O2’s MBB (mobile broadband) and smartwatch customers will receive an annual price increase of 75p – half the amount that EE customers are experiencing.

A VMO2 spokesperson said:

“From January [2025], we’ll change how we communicate and implement price increases. All future price changes will be included in customers’ contracts in pounds and pence, giving them even more certainty about how their bills may change over the course of their contract.

For new and re-contracting Virgin Media customers, this will be a flat increase of £3.50 a month, effective each April, while airtime price increases for O2 customers will be £1.80 a month, with device payment amounts remaining frozen. At less than the cost of a takeaway coffee or a sandwich, this represents excellent value for connectivity that our customers are using more than ever before, at the same time as we invest more than £5 million a day in our networks and services to give our customers the fast and reliable connectivity they increasingly rely on.”

The concern for consumers is that this approach does have its flaws, such as with the fact that it may make some entry-level packages more expensive than they would have been under the old system (particularly now that RPI inflation has returned to a more normal level). The fact that providers can specify a specific rise ahead of time will also do little to dampen calls for an outright ban on mid-contract hikes in favour of fixed term pricing.

However, not all ISPs adopt the same approach as the biggest players and many smaller providers, particularly newer alternative networks (altnets), often promote packages with simple fixed price terms. We should also point out that Ofcom won’t formally begin enforcing this policy change on the market until 17th January 2025, but that’s not far away now.

Finally, consumers should take note that Ofcom’s new policy is typically only focused upon the core subscription price of a package, thus call charges and any paid add-ons may still adopt a different approach. VMO2 also argues that it needs to raise prices because its own costs keep going up due to increases in data usage, network upgrades, new regulations, new features / content and service delivery costs etc. (e.g. energy bills more than doubling over the last two years). Inevitably, those increases often end up being passed on to consumers.

People travelling on the tourist focused Swanage Railway in Dorset (England), which is a heritage railway attraction that operates full-size steam and diesel passenger trains along the 5+ miles of line from Norden to Corfe Castle and down to the seaside town of Swanage, will soon gain access to onboard WiFi thanks to a new project.

The Dorset Council teamed up with tech company Excelerate Technology UK to bring mobile network and satellite-powered (Low Earth Orbit) public WiFi to Purbeck Park car park, the nearby Norden train station and on board the railway’s popular steam service from early 2025. The project is said to be part of the government’s Rural Connectivity Accelerator (RCA) programme.

The RCA has committed £163,021 of funding to support the roll-out, which will also enable the railway to adopt cashless payments (currently a problem due to poor mobile signal in the area), boost their social media presence and improve safety with Voice over Internet Protocol (VoIP) WiFi calling available for staff, volunteers and visitors.

Cllr Richard Biggs said:

“This is a groundbreaking project at Swanage Railway, which could help pave the way for better connectivity in the future.

Not only will it enhance the visitor experience for people using the railway, but it will explore how these technologies can improve services in remote areas.

It is a fantastic example of how we’re working towards a more connected and inclusive Dorset, ensuring that everyone benefits from digital innovation.”

Swanage Railway is said to contribute more than £15 million to the Dorset economy every year, but rising costs and falling visitor numbers have hit it in recent years. The railway’s move to go cashless in March 2024 has similarly struggled a bit due to many of the nearby rural areas being poorly served by fixed and mobile operators.

Still, £163k does seem like rather a lot of money for a public WiFi network, although fitting such hybrid equipment to a moving train and ensuring it works across the whole route does tend to be a bit more of a challenge than your usual site-specific deployment.