In a deal that has the potential to rock the status quo in the UK, Vodafone and CityFibre have teamed up to build a new FTTH network. It's a direct challenge to BT, which has been trying to get Vodafone and others to chip in funding for its own expansion of OpenReach.
The first phase will see a buildout to some 1 million homes by 2021, potentially expanding to 5 million homes by 2025. CityFibre will build and operate the network, with Vodafone leasing it exclusively during an initial period. After that, CityFibre will be able to lease it on a wholesale basis to all-comers.
CityFibre has been building out in a few dozen metros around the UK for some time, but this deal greatly expands the company's potential operations. The first phase of the deal is estimated to be worth more than £500M over 20 years, assuming Vodafone meets the 20% volume commitment they've agreed to for the first 10 for that full period.
Construction will start sometime in the middle of 2018, hooking up the first customers by the end of that year. The first towns and cities that will get hooked up will be announced over the coming months, although I'll bet there will be some overlap with the metro infrastructure CityFibre already has in place.