CityFibre raises £200m for Britain's broadband revolution... but outside London

Oliver Gill
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Broadband investment is about future-proofing the UK, the boss of CityFibre said today (Source: Getty)

London’s broadband network is in danger of being left in the dark ages as other UK cities forge ahead with digital investment, the boss of an internet challenger said today.

Aim-quoted CityFibre this morning announced plans to more than double its market capitalisation with a £200m fundraise. The move was backed by star fund manager Neil Woodford among others.

The capital raise is hot on the heels of the government launching a new £400m broadband infrastructure fund, to encourage better investment in Britain’s broadband infrastructure.

Read more: Mapped: London's best and worst broadband (City workers, look away now)

CityFibre, which designs, builds and operates fibre broadband networks, plans to use the proceeds to fund expansion into at least 50 cities across the UK by 2020. It is marketing itself as the builder of "gigabit cities".

But speaking to City A.M., chief executive Greg Mesch revealed CityFibre has put London on the too-difficult-to-deal-with pile.

He said:

There is chance that CityFibre’s model will put better digital infrastructure in the secondary cities than in London, for sure.

“I think London should be built out by Virgin [Media] and BT quickly.”

The majority of the UK’s fibre broadband is delivered by networks to BT Openreach’s street cabinets. The final metres into people’s homes is then transmitted down old-fashioned copper wires. Some of these are more than a century old, Treasury minister Andrew Jones warned earlier this week.

Providers such as Virgin Media offer a service to plumb fibre directly into households, called fibre to the home (FTTH), in an attempt to ensure better download and upload speeds.

CityFibre said it plans to roll out FTTH to between five and 10 locations across the UK in 2018.

Mesch said:

This is about more than just better broadband – this is about future-proofing the digital infrastructure we’ve all come to rely on at work, at school, at home and in our communities.

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