Alternative network provider and rural broadband ISP Gigaclear has today revealed that, as part of “planning for the next stage of its development” and a “re-focus on ultra-rural areas“, their current pace of full fibre (FTTP) build will be slowing and that means job losses.
The “ultra-rural” re-focus mentioned above is likely to be Gigaclear’s way of alluding to the recent state aid supported contracts that they’ve secured under the Government’s £5bn Project Gigabit programme, which includes a £16.6m build contract for East Gloucestershire to reach 4,400 premises (here) and the £26.5m contracts for North and South Oxfordshire to reach 10,000 premises (here).
The announcement doesn’t say how many jobs will go, but sources have told ISPreview that up to 100-150 roles could be on the chopping block (exact figures are subject to consultation), which may have a particularly strong impact upon their build teams. The provider’s community engagement team are also expected to take a hit, but the full team will not be wiped out.
Gigaclear’s announcement does, however, confirm that they’ve now built their Fibre-to-the-Premises (FTTP) broadband network to over 560,000 premises (up from 500k in March 2024) – in some of the most hard-to-reach parts of the country – and serve over 120,000 customers (up from 100k in March 2024).
“With that growth in build achieved, the business is now planning for the next stage of its development and will re-focus on ultra-rural areas that are still reliant on the old-fashioned and out-dated copper network, which provides poor speeds and contributes to a digital divide across the country. Recognising that the amount of brand new build will not be of the levels of the last five years, a number of roles across our build teams will be reduced to match our increased focus on ultra-rural. A consultation period has now started with the impacted teams,” said the announcement.
Gigaclear’s Delivery Director, Tony Smith, told ISPreview:
“This important strategic decision is about ensuring we target our future builds on ultra-rural communities that do not have access to full fibre broadband which is crucial to continuing to ensure the long-term success and growth of the business.
When Gigaclear was established, our purpose was to deliver ultrafast, reliable broadband to the rural areas of Britain that were still lumbered with poor connectivity. We have shown that we can provide these communities with the speeds enjoyed by larger, urban areas.
I am immensely proud of our people and all they have achieved, the restructuring of our build teams is a very difficult but necessary decision to ensure the future strength of the organisation and will reinforce our unique position in the industry, focusing solely on ultra-rural parts of the country. We promise to do as much as we can to reduce the impact on our affected colleagues.”
The development surfaces in the same week as Gigaclear’s latest annual accounts to the end of 2023 were published, which we covered yesterday (here). The operator’s accounts revealed that their revenues had increased by 32% to £33.8m (2022: £25.7m) and their workforce had grown to 819 employees in 2023 (up from 670), but their losses for the year also grew sharply to £138.3m (2022: £21.8m).
At the same time Gigaclear are not immune to the same strains that many other network builders are currently experiencing, which can often be linked back to high interest rates, rising build costs and an aggressively competitive environment that can make it harder to both grow take-up or attract fresh investment.
On the other hand, the switch to focus on their Project Gigabit deployments is probably a sensible one (CityFibre did something similar earlier in the year), particularly if they hope to secure any other contracts in the future. In the past, Gigaclear has often struggled to deliver on some of their state aid backed deployments (e.g. Devon and Somerset), which is a mistake they won’t want to repeat.
