Huge UK Trackside Telecoms Deal Edges Closer(21 Feb 2023, BWCS Staff)
Neos Networks, formerly known as SSE Telecoms, has emerged as the preferred bidder for Network Rail’s Project Reach. While this does not mean Neos has won the day, it is at least in the driving seat to partner Network Rail in its £1 billion drive to upgrade around 16,000km of trackside cable network and add new wireless masts.
Last year, both Neos Networks (bidding alongside Cellnex) and Virgin Media (bidding alongside Nokia and Jacobs) were approved to bid to be NR’s partner in the huge trackside telecoms upgrade. Neos said it will invest in the design and construction of a new trackside fibre communications network, which will carry signalling for trains, trackside sensors, CCTV and high-speed broadband provision for trains, railway depots and offices. The move could also help to improve UK gigabit broadband and 5G mobile coverage.
Scottish and Southern Energy bought the original Neos Networks for £13.4 million in February 2003 and merged it into its wholesale telecoms business, which at the time was operating as SSE Telecommunications. In 2021 it reverted to the Neos Networks brand.
Network Rail’s current trackside data infrastructure, which still consists of many hundreds of miles of legacy copper, mixed with fibre-optic cabling, is certainly in need of an upgrade. Some six years ago, the company seemed all set to sell its cable links or enter into a joint venture to build them up. However, despite several large telecoms companies coming to the table, no agreement was reached and the plan was put back on the shelf.
It is understood that NR will retain ownership and access to the cables, but the new investor will have access to spare capacity. The chosen investor will also assume responsibility for upgrading the cables and replacing the remaining copper lines with fibre optics as well as rolling out up to 250 new wireless masts alongside the train-tracks to reduce, if not eliminate, so-called mobile cellular and hence WiFi notspots.
It has been pointed out that in a wider context, the arrival of a cash-rich, telecoms-savvy partner for Network Rail could ultimately help boost the roll out of 5G in Britain. It is also expected to support the UK Government’s £5 billion Project Gigabit broadband rollout (nationwide gigabit coverage by around 2030) and the wider industry-led £1 billion Shared Rural Network (SRN) project, which aims to extend UK geographic 4G mobile coverage to 95% by the end of 2025.
Neos’ 34,000km of cable represents one of the fastest-growing, high-capacity business fibre networks in the UK. The company says it plans to work with a tower company – as yet officially unnamed – to boost mobile connectivity to Network Rail.
Neos Networks said this project will support it in expanding its national network reach to increase coverage and to improve access to high-capacity services.
“These services will be beneficial in transforming business operations for enterprises, hyperscalers and service providers, as well as mobile network operators looking to enable 4G and 5G connectivity along the rail corridor,” said Neos.
Harriet Hepburn, Network Rail’s Corporate Finance Director, said, “This is an exciting opportunity for NR, and we are excited at the prospect of entering this long-term partnership. The proposal provides a comprehensive package that will deliver real benefits for passengers and the railway, and also significant savings for the UK taxpayer.”
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