BT share price: Telco cuts back on upgrades to existing broadband network

Move follows change in government strategy

BT share price: Telco cuts back on upgrades to existing broadband network

BT Group (LON:BT.A) has cut back its plans to upgrade 10 million copper broadband lines, the Financial Times has reported. The move came as the government abandoned its previous view that adequate internet speeds can be achieved by improving the current network.

BT’s share price has fallen into the red in today’s session, having given up 0.76 percent to 227.25p as of 08:52 BST. The decline is largely in line with losses in the broader UK market with the benchmark FTSE 100 index currently standing 0.69 percent lower at 7,688.18 points.

BT cuts back on network upgrades

The FT reported yesterday that BT’s network division Openreach will now upgrade 5.7 million copper lines to its G.fast technology in the next two years, compared with 10 million previously, citing a letter to the unit’s customers. The division will further install three million full-fibre lines in the same timeframe, marking an increase of one million over its original target.

A spokesman for Openreach told the newspaper that it was already connecting 10,000 premises each week to full-fibre lines, but that it would continue to upgrade copper because it was quicker and less disruptive.

The news comes after the government recently launched its Future Telecoms Infrastructure Review, shifting away from an upgrade of the copper line network and committing to rolling out 15 million full fibre-optic connections by 2025, with the rest of the country following by 2033, the FT reports.

Openreach remains under pressure

The news comes with BT continuing to face regulatory pressure to focus on full fibre cables. The newspaper notes that while Openreach has adopted a ‘fibre first’ strategy last year, businesses have said that the target was not ambitious enough.

As of 09:10 BST, Friday, 10 August, BT Group plc share price is 226.90p.

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