“Altnets” Explained.

“Altnet” means “Alterntive Networks” and we have three types of altnets in the UK. Open Access, Closed Access & the hybrid – Open & Closed Access.

Open Access Networks are full fibre providers who lay and manage the cable infrastructure and network, but do not connect customers direct to a internet service. The largest Open Access network in the UK is Openreach. But Openreach arent a “altnet” because they were, for many years, the only network supplier (bar Virgin).

Open Access networks will concentrate on passing as much properties as possible (meaning their fibre cable is near a home or business to connect to full fibre) for their ISP’s to connect customers onto. The more properties they “pass”, the more chance that ISP has to connect the customer to full fibre.

The reason why ISP’s prefer “altnets” to Openreach is cost and service. Its far more likely, a Open Access altnet, will be more affordable from a cost price point of view, meaning the ISP has more margin to play with. Its also more than likely, the “altnet” will provide a better service. They’re “more desperate” to get customers connected so will install faster and they have less connected customers to handle, so will more than likely provide a better service.

“altnets” also usually provide a better SLA. Meaning if theis a fault in the network, the turn around to fix that problem will be quicker than Openreach.

An example of a Open Access Network is Cityfibre. They are the largest “altnet” Open Access network. Covering more than 2M properties, ISP’s favour Cityfibre over Openreach any day of the week, they just don’t pass as many properties. Openreach passes over 15M.

Closed Access Networks are full fibre providers who lay the cable and connect the customer direct under the same brand. This model makes sense. The margins are higher per connected customers and if the “altnet” is laying fibre in an area, in branded vans, it warms the customer up when it comes to connecting them.

The trouble is, it can expensive and difficult to connect customers once you “pass their property”. For some closed access networks, penetration targets arent being met (meaning they arent connecting the enough customers after passing properties), so they’re looking to become both a Open Access Network & Closed Access Network.

They’re are a good few very successful Closed Access Networks, like Hyperoptic & Gigcalear. Both operating above a 20% penetration on properties passed.

Some “closed access networks” will lay the cable under one brand, then connect the customer under another. This is a smart move as they’re able to easily adopt both Open Access & Closed Access without providing a conflict of interest to the ISP’s (if the cost pricing is right). A really good example of this is Youfibre & Netnomia. Youfibre is the ISP brand connecting the customers and Netnomia is the brand laying the fibre.

That brings on us to our third type. The hybrid – Open Access & Closed Access Networks. For some “altnets” needing to connect more customers, they are offering a Open Access model, whilst running alongside, their direct selling brand.