BT has increased its fibre deployment targets and says EE is on track to launch 5G “imminently” in 16 UK cities.
So far, Openreach has connected 1.2 million premises with fibre to the premise (FTTP) technology with a view to reaching three million by 2020 and 10 million by the middle of next decade. At the current pace of rollout, around 20,000 properties are being added each week.
It now plans to cover four million by 2021 and 15 million by the mid-2020s – if it there is a suitable investment and regulatory climate.
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The UK’s largest telco made the announcements in its annual financial results which show a decline in reported revenue of one per cent to £23.43 billion.
Growth in BT’s consumer divisions was offset by ongoing challenges in its enterprise and global services business, but pre-tax profits rose by two per cent to £2.666 billion.
“While we are really well positioned in a very challenging and competitive UK market, we have a lot of work to do to ensure we remain successful and deliver long term sustainable value to our shareholders,” declared BT CEO Philip Jansen, delivering his first set of results since joining the company earlier in 2019.
“We need to invest to improve our customer propositions and competitiveness. We need to invest to stay ahead in our fixed, mobile and core networks, and we need to invest to overhaul our business to ensure that we are using the latest systems and technology to improve our efficiency and become more agile.”
The expansion of the company’s fibre targets come at a time when several other companies are investing in fibre and a number of smaller infrastructure players have recently been bought out by equity firms.
This has led to concerns that BT could be left behind in the consumer and wholesale markets, including those for mobile backhaul. The vast majority of Openreach’s superfast network uses fibre to the cabinet (FTTC) technology, with the company planning to use a combination of G.Fast (which speeds up copper connections) and FTTP to upgrade its network.
It had been speculated that BT would cut its dividend for the first time since 2009 in order to fund infrastructure expansion – a move which some shareholders would have accepted if long-term gains could be proved – but this has not happened.
“For 2018/19 the Board has decided to hold the full year dividend unchanged at 15.4p per share,” added Jansen. “The Board also expects to hold the dividend unchanged in respect of the current financial year given our outlook for earnings and cash flow.”
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