UK’s fibre fiesta sees CityFibre’s Project Gigabit contracts ‘re-scoped’

Article summary

CityFibre and the UK government’s Building Digital UK agency have agreed to re-scope nine contracts under Project Gigabit. This decision reflects the accelerated rollout of commercially funded fibre, reducing the need for government subsidies. Revised targets aim for 450,000 premises by 2030, with a portion directly subsidised.

UK’s fibre fiesta sees CityFibre’s Project Gigabit contracts ‘re-scoped’

Image source: Total Telecom

Overview of Contract Re-scoping

CityFibre, a fibre network operator, and the UK government’s Building Digital UK (BDUK) agency have agreed to re-scope nine contracts under Project Gigabit.

This decision comes in response to the accelerated rollout of commercially funded full fibre across Project Gigabit areas, indicating that government subsidies are no longer necessary in some locations.

Project Gigabit Background

Launched in 2021, Project Gigabit promised £5 billion in government subsidies to assist fibre network operators in reaching some of the UK’s hardest-to-reach premises.

In 2023, CityFibre secured ten contracts under this initiative, amounting to approximately £782 million in subsidies, intended to connect 1.3 million homes and businesses in rural areas.

By early last year, CityFibre had already reached 150,000 premises, with 70,000 benefiting from the subsidies.

Revised Targets and Contract Changes

Following an analysis of data from BDUK’s ongoing Open Market Review process, the partners have agreed that the scope of the contracts is too broad for current market conditions.

The revised targets will focus on connecting 450,000 rural or hard-to-reach premises by 2030, with 226,000 of these directly supported by Project Gigabit.

Notably, a £58.6 million contract for Nottinghamshire and West Lincolnshire will be returned to BDUK.

Statements from CityFibre and Government Officials

Simon Holden, CityFibre’s Chief Executive Officer, expressed pride in the company’s role in Project Gigabit, stating, "BDUK’s commitment has helped spur further investment and continued innovation...

The time is right to focus on where we will have the biggest impact." Telecoms Minister Liz Lloyd highlighted the government’s role in facilitating upgrades to over 229,000 hard-to-reach premises in the past 18 months, noting that reforms in the telecoms market have allowed for a surge in commercial broadband rollout.

The announcement reassures that these changes will not hinder BDUK's goal of achieving 99% gigabit coverage across the UK by 2032.

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