Virgin Media O2 sets up new fibre network subsidierary to challenge BT Openreach

Virgin Media O2 and its shareholders Liberty Global and Telefónica are to challenge BT Openreach with their own net network company called NetCo to build fibre network infrastructure.

The venture is ley to Virgin Media O2’s ambitious plan to upgrade 16 million homes across the UK to full fibre as a major competitor to BT’s Openreach offering a wholesale alternative for other internet service providers.

NetCo will be a subsidiary of Virgin Media O2 and incorporate Virgin Media O2’s cable and fibre network, which currently reaches 16.2 million premise. NetCo aims to provide flexible financing options and support alternative network providers (altnets). The company’s consumer, business-to-business units, and mobile network will continue to operate independently.

Virgin Media O2’s mobile assets will remain separate from NetCo. The nexfibre joint venture, between Liberty Global, Telefónica will also operate independently. The combined efforts of NetCo and nexfibre are projected to extend their fibre network to up to 23 million homes, covering approximately 75 per cent of the UK and significantly enhancing competition in the country’s broadband market.

This development is currently in progress, with further details and operational timelines to be announced following necessary regulatory approvals. Lutz Schüler, CEO of Virgin Media O2, highlighted the initiative as a “logical evolution” of the company’s fibre strategy, aimed at reinforcing its role as a leading challenger in the UK’s broadband market and facilitating wider network choice and financial flexibility for future growth.