FTTHForum 2011 James Enck, city fibre holdings

Strictly Confidential

UK FTTx: The Sleeper

Awakes

Challenging the Status Quo in

a Rapidly Changing Market

1

James Enck

Corporate Development

9 November, 2011

Budapest


2

The UK’s long, dark night is coming to an end.

It’s awakening to a new world of possibilities…

Enabled by fibre!


The UK hasn’t even been on the radar screen

High internet adoption, poor connectivity

Source: FTTH Council Europe and IDATE

0% 10% 20% 30% 40% 50% 60%

UK

Germany

Ireland

Iceland

Sweden

Norway

Switzerland

Portugal

Czech Republic

Denmark

Latvia

Belgium

Romania

Netherlands

0% 20% 40% 60% 80% 100%

Romania

Portugal

Czech Republic

Ireland

Latvia

Switzerland

Belgium

Germany

UK

Denmark

Netherlands

Sweden

Norway

Iceland

Internet population penetration Connections >5Mbps

Source: www.internetworldstats.com Source: Akamai

Strictly confidential

Nature abhors a vacuum, so does the market

There is a huge gap to be filled by entrepreneurial capital

4

22.5

20.0

17.5

15.0

12.5

10.0

7.5

5.0

2.5

0

£bn

FTTH = £15bn

Lower costs –

DIY, pole/duct

sharing

25.0 FTTH = £25-28bn

Source: Independent Networks Cooperative Association

Note 1 – Fujitsu announcement via press release, but their

pledge is dependent on receiving £500m of the NGA fund.

Therefore, this commitment is highly speculative.

Note 2 – The BDUK fund is £530m in this government

term, the remaining £300m is dependent on re-election

Note 3 – EU funding is speculative and no commitment

has been secured

BT FTTC = £6bn

Private Sector

BT £2.5bn

Fujitsu – Note 1 £1.5bn

Government

BDUK Fund – Note 2 £0.83bn

EU Funding – Note 3 £1.0bn

Total £5.83bn

Funding for NGA Pledges announced or assumed

Source: BSG/Analysys Mason report 2008

Reality check – only £3.0bn is on the table today!!!


5


Then, in the summer of 2011…

A sudden burst of activity from newcomers

6

FTTB in large-scale MDUs, high-density urban Disruptive dual-play fat-pipe proposition Team previously built BE Unlimited and Bostream

Demand aggregation in affluent villages Single-play fat-pipe proposition Acquired service provider Rutland Telecom

Community Benefit Society structure Incentives for foundation shareholders Value proposition built around broad economic benefits


7

Suddenly, the puzzle gets more interesting.


Introducing CityFibre Holdings

A new force in UK fibre infrastructure

8

Who we are: Founded as acquisition vehicle January 2011,

transaction closed April 2011

We are a re-start, not a start-up

Extensive experience of building successful fibre-

based telecoms companies

Strong track record of attracting and deploying capital

for large infrastructure projects

Why we’re unique:

Holistic approach delivering a well-planned and highly-

utilised citywide fibre infrastructure in second tier UK

cities – addresses all key market stakeholders

High demand from our anchor tenant partners

Building a new force from a strong existing asset base

Audacious target of 1.0m homes and 50,000 business

by end of 2015


Valuable physical assets

What we acquired gives us a head start

9

Dark fibre provider:

100+ contracts; over £16m in contracted revenue

261km of duct and 29,000km of fibre in key secondary cities

354 buildings and data centres connected to the network

York (pictured) alone has 95km of cable and 103 connected buildings

Mission critical dark fibre services for local authority clients: health,

education, police, local government etc.

Fibre to the home: Bournemouth – UK’s largest FTTH project. 24,000 homes passed

and ready for service by year end. Trial customers live today,

commercial launch in Q1 2012.

PON architecture - symmetrical 100Mbps and 1Gbps services

MOUs in place with other UK cities representing over 1 million

homes – currently in discussions over selection of next city

Wholesale platform: Layer 2 – active layer for operating the FTTH network

Interconnects in common format to all 3rd party service providers

The single largest FTTH deployment

in the UK to date

The leading independent fibre

infrastructure provider in secondary

UK cities

Strictly confidential

Our major markets

A solid platform for expansion

10

Sheffield: 20km of

cable, 15km of duct,

112 access points, 23

buildings on net

York: 95km of cable,

91km of duct, 561

access points, >100

buildings on net

Bath: 12km of cable,

8km of duct, 58 access

points, 11 buildings on

net

Bournemouth: FTTH

24,000 homes passed

The largest FTTH

project in the UK!

Derby: 15km of cable,



net

Newcastle: 11km of

cable, 10km of duct, 68

access points, 7

buildings on net

Weston Super Mare:

10km of cable, 10km of

duct, 76 access points,

7 buildings on net

Dundee: 29km of cable,



net


Our vision of the well-connected community

Filling the infrastructure void in second-tier cities

11

One citywide fibre

network:

A well planned fibre network that blends metro network design with FTTP

to ensure an efficient and highly utilised network.

Capable of passive (dark fibre) and active (assured Ethernet) services.

Servicing many

segments

(typical 2nd tier city):

Local Government:

Enterprise:

Carrier:

SME:

Consumer:

200 buildings; councils, NHS, education, police, etc.

Data centres, financial services, etc

100+ 3G cell sites – growing with 4G and Wi-Fi

5,000+ business

100,000 homes via service provider partners


The next step in our plan

The train is leaving the station!

12

Recently appointed Macquarie Capital as advisor on our capital raise. A globally-

recognized specialist in communications infrastructure-related investment

banking adds great depth to our ability to fund our £500m investment plan.


What to look out for in the next few months

Proving the case step by step

13

Service provider discussions ongoing – both Tier 1 and smaller players

Our first service provider relationship announcement is imminent

Bournemouth network live today, on track for commercial launch in Q1

More service providers to be onboard in early 2012

Metro business pipeline continues to grow, including some unsolicited

inbound enquiries – demand for fibre infrastructure is intensifying

Currently in advanced analysis work and discussions on candidates for

subsequent FTTP cities

The opportunity is real, and so are we!


Thank you

14

FTTHForum 2011 James Enck, city fibre holdings

Economy & Finance

Transcript of FTTHForum 2011 James Enck, city fibre holdings