Altnets confident about future growth despite fears, survey reveals

A new survey of 300 alternative networks, ISPs, suppliers and other technology companies has found that 83% of altnet decision makers believe their companies will grow over the next year despite reports of their imminent demise.

A further 77% anticipate growth over the next five years looking ahead, with many planning to increase their investment in the coming 12 months.

Similarly, 70% say the forthcoming consolidation will have a positive impact.

The new Altnet Confidence Index from Proactive International PR and Censuswide provided an in-depth look at the altnet sector, assessing its ability to grow, looking at where planned investment is focused and revealing the real view on consolidation in the industry.

Many altnets are looking at consolidation to balance against the difficult market conditions that have recently arisen over the past few years, driven by high interest rates, rising build costs and strong competition – resulting in consolidation agreements taking place.

Those that have yet to consolidate often change strategies from network build to greater commercialisation meaning more effort is  required to grow their customer base.

Despite all this, the survey also indicates that many altnets remain optimistic but there are still causes for concern.

‘Rising operational costs’ worry 37% of respondents, as do ‘Increased regulatory pressures.’ A further 31% of respondents said ‘Consolidation of smaller players reducing opportunities’ was a concern.

However, the overall view on consolidation was favourable, with 70% of decision makers describing it as impacting their business very or somewhat positively.

James Page, Proactive International PR CEO said: “There has been a view for some time now that the UK’s alternative broadband sector was in decline. With investors demanding to see returns on their investment and customers’ unwillingness to pay substantially higher prices for higher speed services, the future seemed to consist only of mergers, acquisitions and a sharply diminishing number of companies remaining in the market.

“We wanted to gauge how the sector was feeling – and the results are surprising.”

Lucy Stewart, Head of Client Services at Censuswide concluded: “The findings were varied but overall, they followed some key themes. For example, when we looked at confidence and growth outlook there was a lot of optimism, both in the short and longer term. It’s interesting to see that respondents are feeling so optimistic and we can dive into the data to look at some of the reasons for this.”