TalkTalk looks beyond Openreach for wholesale contracts

(Image credit: TalkTalk)

TalkTalk is reportedly seeking alternative wholesale suppliers for its business broadband services, inviting infrastructure owners other than BT’s Openreach to bid for up to £600 million in contracts.

The company’s business division commands more than a quarter of the market for high-speed Ethernet connectivity, which provides dedicated speed and bandwidth to support mission critical applications.

It works with a range of reseller partners, including Claranet and Daisy Communications, but like many consumer and business broadband providers, TalkTalk doesn’t own and operate physical networks itself and instead leases capacity from those who do.

TalkTalk takeover

Openreach has traditionally been a key supplier due to its nationwide footprint and currently commands the lion’s share of TalkTalk’s business. 

However, Bloomberg now reports TalkTalk is keen to take advantage of a flurry of network building in recent years.

CityFibre is targeting eight million homes and businesses by 2025, while Virgin Media O2 has indicated it would like to be more involved in the space.

While Openreach’s nationwide footprint means it will still be indispensable in more remote parts of the country, TalkTalk believes it could benefit from competition in other locations, lowering costs. There are 14 regional contracts up for grabs in total.

Of course, such plans could change should ownership of TalkTalk change hands. The company has been viewed as an acquisition target for other telcos over the past few years, with reports suggesting Virgin Media O2 made a £3 billion opening offer earlier this summer.

Via Bloomberg

Steve McCaskill is TechRadar Pro's resident mobile industry expert, covering all aspects of the UK and global news, from operators to service providers and everything in between. He is a former editor of Silicon UK and journalist with over a decade's experience in the technology industry, writing about technology, in particular, telecoms, mobile and sports tech, sports, video games and media.