Pivoting from build-out to consolidation: AltNets take stock
4 min read 18 February 2025
2024 was the year the great ‘build rush’ slowed down and fibre businesses began to focus more closely on their longer-term run model, with investor expectations and a return to economic fundamentals in increasing focus.
Key developments entering 2025
Having invested heavily in scaling up their networks, AltNets are under pressure to show a return. As a result, we’re seeing more aggressive pricing to acquire customers, along with a trend for consolidation, administration and partnering up in the wholesale space. But it’s far from plain sailing, with enduring customer loyalty to the big brands proving to be a big challenge to customer acquisition.
Several market developments during 2024 highlight the pivot that’s underway. These include:
- The long-term partnership agreed between Sky and CityFibre (providing nationwide coverage for Sky and a key revenue stream for CityFibre)
- The merger between Netomnia and Brsk, creating one of the largest AltNets
- Plans to create a new national fixed network company announced by VMO2, Liberty Global and Telefónica
- Fresh funding rounds and cost of borrowing hikes
- More overt question marks around both the longevity and value-case of the AltNet business model.
The focus for 2025 and beyond
Looking ahead, 2025 is set to be a watershed year for the fibre market.
We believe it’s not a question of ‘if’ further consolidation will happen, but rather ‘when’. And in the meantime, businesses will be under mounting pressure to show returns – by growing the topline and reducing the bottom line in tandem.
In this 2025 landscape, we believe there are five key priorities for AltNets:
- Re-focus on your ‘endgame', for example by developing business strategies focused on customer/product differentiation vs. fibre-only lean business models.
- Increase strategic customer acquisition and deliver on a strong retention focus.
- Drive down cost-to-serve through lean business models.
- Implement smarter technology, whether in consumer-facing areas or to support network aggregation.
- Decide on the role to play in the market consolidation and scenarios ahead.
Discover more perspectives on key trends shaping TMT in 2025
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