The broadband regulator is investigating five fibre providers over their finances. Worth knowing who you are signing with.

On 16 July Ofcom opened investigations into five alternative fibre broadband providers, the smaller networks known in the industry as altnets that have spent recent years building their own full-fibre to rival Openreach. The question is not about service quality. It is whether each has set aside enough money to cover a specific legal obligation. The five named are Internetty, Cambridge Fibre Networks, Optical Fibre Infrastructure, Pine Media and Trooli. Ofcom says it has reasonable grounds to believe they may not be meeting the requirement. Internetty has said it has the necessary arrangements in place.

What the rule actually is

Any network operator granted what are called Code Powers, the legal rights that let it dig up streets to lay cable, has to prove each year that it holds funds to cover its liabilities. Chief among them is the cost of putting right any damage its works cause to roads and pavements. The point of the rule is that if a provider runs into trouble, the public and local councils are not left paying to tidy up. Under Regulation 16 of the Electronic Communications Code, operators file this proof with Ofcom every year on 1 April. These investigations are Ofcom checking whether the paperwork stacks up.

A rough month for the altnet sector

The timing sits inside a wider squeeze. In the same week, CityFibre, one of the largest altnets, told around 200 staff their roles were at risk, pointing to slower-than-expected consolidation in the market and growth that has not come as fast as hoped. The altnet build-out of recent years was funded by cheap investment money, and as that has tightened, several networks have merged, paused building or cut costs. Most will come through it. Some may not, and a few will be bought by rivals.

Why this matters when you buy business broadband

The switch-off is pushing every business to move its phone lines and, often, its broadband onto new services over the next eighteen months. A lot of firms will sign multi-year connectivity contracts in that window. When you do, the financial health of the provider is a fair thing to weigh, not just the headline price and speed. A cut-price deal from a network that later folds or gets swallowed can mean a forced move, a change of terms or a gap in service. None of this makes altnets a bad choice, and many offer excellent full-fibre. It is a reason to look past the monthly figure and ask who you are actually tying yourself to.