Virgin Media 02 will upgrade 14m homes to full fibre broadband

Virgin Media O2 has ramped up its rivalry with BT today after announcing plans to upgrade its entire network of 14million homes and businesses to full fibre broadband by the end of 2028. 

The announcement came just weeks after BT-owned Openreach unveiled plans to provide full fibre broadband to 551 more towns and cities, as part of a £15billion mission to reach 25million premises by the end of 2026.

BT’s share price has fallen by more than 8 per cent today after it revealed its global business services arm had been struggling in the last few months. 

Recently merged Virgin Media O2 said the ultrafast fibre technology would be laid alongside existing cables in underground tunnels, costing around £100 per property.

The switch will cover 14.3million cable premises by the end of 2028, building on the 1.2million that already have access to full fibre.

Virgin Media O2 boss Lutz Schuler said the move heralded ‘the next evolution’ of its network ‘ensuring we’re fibre-fit for the future.

‘Our mission is to upgrade the UK, and we are doing exactly that.

‘Right now, we have the UK’s leading gigabit network, and this upgrade means we’ll be even stronger for the decades ahead, pursuing new opportunities and putting words into action.

‘In 60 days since the formation of Virgin Media O2, we have achieved a lot, but this is just the beginning. With strong foundations for growth in place, we will boost connectivity, provide greater choice and be a challenger the country can count on.’

Virgin Media O2 said the work would represent a ‘modest annual increase’ to its current capital expenditure budget of around £2billion a year. 

Boasting the ‘fastest speeds at scale in the country today, Virgin Media 02, said: ‘The investment will bolster the operator’s long-term network strategy, fuel future connectivity innovation for consumers and businesses and create options to potentially pursue the broadband wholesale market in the UK.’

It added: ‘This technology is capable of delivering symmetrical 10Gbps download and upload speeds and beyond, with the upgrade plan covering 14.3 million cable premises, after taking into account the operator’s existing 1.2 million FTTP homes.’ 

Virgin Media O2 said that by the end of this year it will deliver speeds of 1.1Gbps across its entire network, ‘meeting the Government’s stated broadband targets four years ahead of schedule.’

The group, which is a joint venture that brought together Liberty Global’s cable network and Telefonica’s O2 mobile network, also published its first quarterly results today.

Virgin Media 02 added 36,000 broadband subscribers in the second quarter, while its fixed-line customer base rose to 5.7million and mobile connections grew by nearly 1million.

Adjusted revenue of £2.5billion was roughly in line with last year, while earnings before interest, tax, depreciation and amortisation increased by 6.2 per cent to £935million.

The group said 40 per cent of its broadband customers also have a mobile contract with either Virgin Media or O2. 

The Government’s objective is to get ‘gigabit capable broadband’ to 85 per cent of the country by 2025.

Its £5billion ‘Project Gigabit’ scheme is set to upgrade over 1million hard-to-reach homes and businesses to gigabit-capable broadband connections from 2022.

But, there are mounting concerns that the Government’s targets could be missed as too few people and businesses are aware of what is happening.

Separately, it emerged today that Virgin Mobile is axing its Pay As You Go option meaning 123,000 mobile phone customers will no longer be able to use it on the network.

Those affected by the changes will be notified by October 2021 with changes taking place in January 2022.

After then, the network will cut off any PAYG customers still using this service. The move comes thanks to dwindling numbers paying this way.

Those with PAYG will have the option to take an alternative pay monthly Sim-only plan from Virgin Mobile or can choose to move to another mobile provider with no financial penalty.