UK Broadband Providers Shares Rise on Plans to Boost Connectivity -- Update
July 23 2018 - 10:01AM
Dow Jones News
(Adds detail, analyst comments, updates share prices)
By Adria Calatayud
Shares in U.K. broadband providers rose Monday after the British
government set out plans to boost full-fiber connectivity with the
goal of having coverage across the whole country by 2033.
At 1350 GMT, shares in BT Group PLC (BT.A.LN), the retail
broadband leader in the U.K., were up 1.3%, while shares in smaller
competitors TalkTalk Telecom Group PLC (TALK.LN) and KCOM Group PLC
(KCOM.LN) were up 1.2% and 0.4%, respectively.
Newly built homes will be required to have full-fiber broadband,
while public investments will be made to provide coverage for rural
areas, according to a government report released Monday.
The proposals aim to connect 15 million premises to full-fiber
broadband by 2025 and achieve full coverage by 2033, as this
infrastructure will be needed to support the rollout of 5G.
In the U.K., 4% of broadband connections are full fiber,
compared with 89% in Portugal, 71% in Spain and 28% in France, the
government said. Full-fiber connections are faster, more reliable,
and more affordable to operate than copper-based networks, it
said.
The U.K. government will prioritize promoting investment over
interventions to further reduce retail prices in the near term,
according to the report. It also believes that a move to longer,
five-year review periods could provide greater regulatory stability
and promote investment.
The U.K.'s new policy framework looks supportive for BT,
analysts at Jefferies said.
Although the British telecommunications operator should benefit
from the government's prioritizing investment over retail pricing
and longer market reviews, the report also suggests the broadening
other operators' access to BT's network arm Openreach and retains
the threat of an Openreach separation, analysts at investment bank
Berenberg said.
Furthermore, the U.K. government aims to have a majority of the
population covered by a 5G signal by 2027, according to the report.
If the current market structure doesn't support network investment
in 5G, the country's telecommunications regulator, Ofcom, would
consider options including consolidation in the mobile
industry.
Write to Adria Calatayud at
adria.calatayudvaello@dowjones.com
(END) Dow Jones Newswires
July 23, 2018 10:46 ET (14:46 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
Kcom (LSE:KCOM)
Historical Stock Chart
From Mar 2024 to Apr 2024
Kcom (LSE:KCOM)
Historical Stock Chart
From Apr 2023 to Apr 2024