UK Altnets: VMO2/nexfibre buys Netomnia

VMO2/nexfibre has agreed to buy Netomnia, in a complex multi-party deal involving additional wholesale deal components between VMO2 and nexfibre which will leave nexfibre wholesaling 8 million premises to VMO2, or c.40% of VMO2’s overall footprint.

The purchasers are hopeful of an easy regulatory clearance, but we fear the process may be more protracted given the high overlap and removal of a major competitor.

The impact on VMO2 and other incumbent players is prima facie positive, given that it takes out a major subscriber gainer, but we fear that it will be structurally unhelpful, with the high price encouraging other altnets to continue to disrupt in the hope of a similar take-out.
 

Growing BVOD usage in 2025 was unable to offset declining broadcast viewing, whilst YouTube continued its advance on the TV set and SVOD engagement growth was driven by older viewers.

Households are increasingly shifting towards IP-delivered video, whether through IP-only devices, or more likely hybrid UK TV platforms.

Young people’s viewing to SVOD services is less volatile across the year and throughout the day than YouTube and broadcasters—the latter of which is more likely to be shared with other people.

BT had a solid Q3 in financial terms, with various oneoffs hitting headline growth rates but underlying trends very much robust.

The highlight was reduced broadband line losses for Openreach, both in the quarter and in prospect, with retail altnets slowing faster than CityFibre improves.

Recent developments put the pace of altnet consolidation in doubt, but we expect reduced pressure on BT Consumer and Openreach in 2026 regardless.