2023 could see Altnet consolidation, research says
Consolidation in the “overcrowded” fibre altnets market could play out in 2023, according to ThinkCX market intelligence.
Investment has been pouring into UK fibre rollouts over the last five years leading to rapid growth in small, localised alternative providers.
However, recessionary shocks in the wider economy are leading analysts and market watchers to forecast a cooling off in 2023, leading to a frenzy of mergers and acquisitions (M&A) among the altnet community.
“There’s still a lot of investment available to fuel further fibre growth, but it’s only around one-third the level of ask in the market at large and this is likely to trigger more consolidation among providers in the year ahead,” said Guy Miller, telecoms entrepreneur and CEO at MS3 Networks.
“Understanding the market dynamics at a local and regional level will be incredibly important to building M&A investment cases, particularly for operators looking to build a concentrated subscriber base or branch out into underserved areas.”
ThinkCX’s intelligence platform shows a comprehensive up-to-date view of broadband market share down to each UK county and local authority area.
For example, in Herefordshire, ThinkCX data shows the provider with the fastest growing market share is Zzoomm, which has added 0.87% total market share in the last 12 months alone compared to Gigaclear and zen which have added 0.53% and 0.75% respectively.
“Simply adding together some of these numbers accurately depicts how M&A between some of these providers would result in clear advantages,” said Ron Smouter, VP of sales and marketing at ThinkCX.
“As this example shows, market share for these altnets can be highly localised – providing niche business case opportunities for investors looking to expand penetration without committing to new digs.
“These market share numbers reflect actual service subscriptions, not simply homes passed, and are based on independent technical evidence rather than how customers, providers or vendors have responded to surveys or provided estimates.
“The result is a rich view into where the UK broadband market is going next – with millions of possible permutations in the data which covers every recognised broadband provider active in every corner of the UK market.”