• Neos Networks has been expanding its UK data transport network 
• ‘Project Edge’ has boosted its reach and capacity
• It now has its own data transport equipment in 550 UK exchanges
• Investment is made ahead of expected demand for capacity between the mid-edge and central data centres

While much of the UK’s fixed fibre network investment activity has been focused on the last mile, the access network, competitive operator Neos Networks has been working to ensure that a capacity bottleneck doesn’t build up between the edge of the network, specifically at the local exchanges where access traffic is aggregated, and centralized data centres with its Project Edge investments.  

At last, the UK’s access network is getting the fibre treatment, with scores of companies now building fibre-to-the-premises (FTTP) infrastructure either for their own use or as open access wholesale infrastructure to be used by multiple retail ISPs. Ultimately that should result in many more consumers and businesses having fatter broadband pipes both downstream and upstream: Add that to the roll-out of 5G mobile networks and the data traffic volumes that will generate, plus the increasing use of cloud services by enterprises, and that adds up to a lot more data traffic that needs to be shunted from the edge to the core and vice versa.

With that in mind, and given its heritage as a metro and long-distance wholesale and enterprise data network operator, Neos Networks (previously known as SSE Enterprise Telecoms) has been focused on building out its network connections between local exchanges owned and managed by BT and the data centres where Neos has a presence. That build-out has been dubbed Project Edge, with Neos announcing this week that it has deployed its networking gear in 550 BT exchanges to enable connectivity services of up to 100 Gbit/s to customers in “almost 750,000 business postcodes” across the UK (in total there are more than 1.7 million post codes). For more on what Neos announced, see this press release. 

But what exactly is it that Neos has installed, why, and what happens next?

Well, it has invested £100 million so far in ‘unbundling’ (installing its own equipment in) the 550 exchanges, a move underpinned by an infrastructure investment agreement struck in 2020 with UK mobile operator Three UK and the support of joint owner Infracapital, which acquired a 50% stake in Neos in a £380 million deal finalized in April 2019. 

But there’s more to come: During 2022, “I would expect the number of unbundled BT exchanges to continue to climb towards 700,” notes CEO Colin Sempill in the company’s official announcement. 

At each exchange Neos has installed Infinera XTM, an optical system designed to handle the transport of mobile data traffic (with its integrated synchronization capabilities) as well as enterprise connectivity using Layer 2 packet/optical aggregation features. These connect back to Ciena and Nokia optical transport systems installed in more than 90 UK data centres (Neos has upgraded its Ciena deployment to Flexgrid systems to improve capacity and flexibility). This architecture enables Neos to offer 100 Gbit/s optical connectivity at each exchange, up to 10 Gbit/s Ethernet services and 100 Gbit/s Ethernet NNI (network-to-network interface) connections with other networks.

Those services, and the integration of synchronization capabilities, meet the needs of Three UK (which also uses Colt for backhaul services) as it upgrades its 4G network and introduces 5G across the UK, but also provides Neos with the opportunity to broaden its customer base. 

And it sounds like there’s further business expansion in the way, as Sempill also noted in the Neos announcement that the company will now also “look to target last-mile fibre connectivity in key regional business hubs.” 

Exactly what that plan entails has yet to be revealed but it seems Neos might be adding to the 50+ companies already rolling out access network fibre across the UK: Currently, Neos offers its Ethernet over FTTX service using wholesale services from Openreach, but BT’s quasi-autonomous access network division is still in the process of rolling out its own fibre to pass the UK’s premises. Neos says in an email response to TelecomTV that “for last-mile FTTP services, we’re reliant of Openreach and therefore as long as Openreach has deployed FTTP then we’re offering it to our customers.” 

The company also wants to expand its third party access network options beyond Openreach too as other operators dig fibre plant across the UK and will use its LIVEQUOTE customer portal to enable a broader range of fibre access coverage. “Our ambition and intention is to constantly add new providers i.e. altnets over time to provide a unique solution to those procuring connectivity services,” states the Neos team. 

Clearly Neos has spotted an opportunity in the market to challenge the likes of BT, Vodafone, Colt and Virgin Media Business in the wholesale and enterprise market in a much more aggressive way as 5G becomes more pervasive, the appetite for high-speed business access services grows, cloud service demand continues to grow, and communications networks become more distributed, all of which adds pressure to the existing wide area data networking infrastructure that simply can’t afford to be a bottleneck in the end-to-end connectivity market. 

Neos is promising to share its next set of expansion plans soon: We look forward to hearing about it.

- Ray Le Maistre, Editorial Director, TelecomTV