FTTP rollout numbers from the BT Group’s “arm’s-length” infrastructure arm, Openreach, were the bright spot in an otherwise difficult quarter, which saw consumer and enterprise revenue slump.
Despite the operational issues caused by COVID-19, the broadband plumber reportedly managed to extend its coverage by an average of 42 thousand properties per week, leaving the firm on track to hit its 4.5 million premises goal by March of this year, which was revised from four million. The fibre-to-the-premises network now reaches 4.1 million spots, according to the figures for the Group’s Q3 ended 31 December 2020.
Openreach’s revenue for the quarter hit £1.31bn, up 2 per cent year-on-year.
In terms of adoption, Openreach recorded 17,000 full-fibre orders per week, although it’s not immediately clear from the figures how this compares to actual installations. Demand nonetheless appears healthy. On the consumer side, BT reported a FTTP base of 686,000 – up 88,000 against the previous quarter.
FTTP adoption is a high priority for UK PM Boris Johnson’s government, and remains so, despite various funding cutbacks and shifting targets. Openreach shares that enthusiasm, not least because it stands to benefit, with FTTP connections typically costing more per-month than legacy connections.
As an added bonus, Openreach gets to shed the cost of maintaining two parallel networks, as the antiquated copper-based system is gradually phased out.
We’re already seeing major steps in that direction, although the pace and scale remains subject to Ofcom’s approval, as well as the ongoing success of the FTTP rollout. In December, Openreach ceased selling copper-based products in Salisbury – which, incidentally, is also the first UK city to get full gigabit fibre coverage. A further 2.2 million premises are expected to be cut-off from new copper-based telephony and broadband products by next January.
Roam if you want to…. but you’re not going anywhere
Elsewhere, BT faced headwinds as the pandemic continued to depress demand for certain high-value telecoms products.
Fixed revenue declined, through “lower out of contract price rises and copper price reductions” combined with a “continued decline” of the Group’s “voice only customer base and call volumes”.
On the consumer side, which includes the mobile network EE, revenue fell by 3 per cent to £2.61bn. This was attributed to a decline in roaming spending, with international travel savagely curtailed by the pandemic, as well as lower out-of-contract usage. BT also reported lower contract spends, as punters deferred handset upgrades and switched to cheaper SIM-only contracts.
Enterprise revenue fell by 6 per cent to £1.37bn, attributed to lower sales of legacy products, as well as general COVID malaise.
In a statement light on detail, Phil Jansen, chief executive of BT, said: “During the current COVID-19 pandemic, BT has continued to deliver for our customers and invest in our networks, our modernisation programme, and our products and services in recognition of the ever increasing need for improved and faster connectivity. We… remain on track to deliver our 2020/21 outlook despite even greater COVID-19 restrictions than previously forecast.” ®