Magnet buys UK FTTH player Velocity 1 - reveals fibre deal with Sky
Overview of the site at Wembley where Magnet is deploying fibre-to-the-home services
Magnet Networks has entered the UK fibre-to-the-home (FTTH) market with the acquisition of a 90pc stake in UK fibre broadband player Velocity 1 from Quintain Estates and Development plc for an undisclosed sum. The move will see Magnet also work with Sky to provide TV services via fibre-to-the-home.
Quintain Estates will retain a 10pc stake in Velocity 1.
Quintain Estates is a London urban regeneration specialist with two of the largest urban regeneration sites in the UK. The Wembley City urban regeneration project alone includes 8m sq feet of commercial and residential space with 6,000 new homes planned in the coming 10 years. Greenwich Peninsula will have more than 10,000 homes when fully developed.
Using Magnet Networks’ Dublin offices as a shared services centre, the company will offer triple play fibre broadband services to UK homes and businesses on an open access basis.
Services will initially be deployed at one of Quintain’s principal urban regeneration schemes in London, Wembley City, with plans for further deployment in the Greenwich Peninsula area of London. Besides being a major international sporting and concert destination, Wembley City will be a key event location for the 2012 Olympics and opens London’s first designer outlet centre in 2013.
The business is now providing services to 500 apartments, a new 660-bed student accommodation complex beside Wembley Stadium, as well as Wembley Arena and a variety of local businesses.
Tie-up with Sky, further infrastructure rollout plans
Magnet Networks CEO Mark Kellett says the acquisition will make Magnet the only firm in the UK providing FTTH services over 100Mbps.
“We have major plans to deploy fibre services to the home in the UK at a rate of approximately 30,000 homes per annum – that’s direct fibre to the home.”
As part of its deployment in Wembley and at Greenwich Peninsula, Magnet has forged an alliance to deploy Sky’s TV services over the fibre loop.
“This will make us the only player in the UK providing Sky over fibre.”
Kellett said Magnet has also signed a memorandum of understanding with an unnamed dark fibre infrastructure owner in the UK that will make Magnet the first provider to join the dark fibre network and potentially serve up to 1m homes in the UK.
He hinted that the UK deal will serve as a template for similar rollout plans in other countries using the Dublin shared services centre to manage billing and customer services, leading to potentially new job opportunities.
“It is our intent to invest in and grow the UK business over the next 10 years given the favourable regulatory and competitive environment, as well as the strong opportunities in the new build market in the UK.
“As an example of this we are already in advanced negotiations to launch services into other geographic areas of the UK outside of London,” Kellett said.
Magnet was the first ISP in Ireland to build a FTTH network which is now available in more than 12,000 homes, making Magnet the largest residential fibre provider in Ireland and the UK.
The services being rolled out in the UK replicate the company’s offering in Ireland and include digital TV, telephone and broadband service offering speeds of 30, 50 and 100 Mbps.
Magnet Networks is a subsidiary of private equity investment company Columbia Ventures Corporation (CVC), holder of extensive telecoms interests on both sides of the Atlantic, including Hibernia Atlantic.
In 2009, the €30m ‘Project Kelvin’ fibre cable that links Ireland to 24,000km of undersea cable linking Ireland with the US, Canada and UK came ashore at Portrush, Co Antrim. The transatlantic and terrestrial cable network offers more than 70 points of presence throughout Ireland, Canada, the US, the UK and mainland Europe.
The latest €300m Hibernia Express network which goes from Halifax in Nova Scotia, Canada, to the UK, will travel along Ireland’s southern coast and it will provide financial and digital-media firms with superfast bandwidth.