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CityFibre to sell backhaul capacity to Vodafone

CityFibre and Vodafone strike a master services agreement to enable the supply of fibre backhaul connectivity to the mobile operator’s cell sites

Urban fibre-optic network builder CityFibre has signed a master services agreement (MSA) with mobile network operator (MNO) Vodafone, covering the supply of fibre network connectivity.

Under the terms of the agreement, CityFibre will supply fibre backhaul connectivity to parts of Vodafone’s UK estate of mobile cell towers, as well as interexchange connectivity to support the enhancement of its national network and some selected corporate customers.

The first call-off under the MSA will be in York, where CityFibre has already constructed a 120km metro fibre network. This also forms part of the fibre-to-the-premises (FTTP) network currently being used to deploy gigabit broadband services around the city by internet service providers (ISPs) TalkTalk and Sky under their Ultra Fibre Optic (UFO) joint venture.

The signing of the MSA is the culmination of two years of negotiation and engagement between CityFibre and Vodafone, according to CityFibre chief executive Greg Mesch.

“As an approved supplier to Vodafone, CityFibre now has the opportunity to bring enhanced pure fibre connectivity to Vodafone’s customers,” he said.

“Furthermore, the addition of Vodafone to our partner ecosystem means CityFibre has now secured trading relationships with the majority of tier one service providers in the business and mobile connectivity markets.”

CityFibre’s rapidly growing network is now spread across 618km of local access networks serving just over 1,000 customer connections around the UK.

It is currently in the process of rolling out five Gigabit City projects, in Aberdeen, Coventry, Edinburgh and Peterborough as well as York, where it is building city-wide fibre networks that it calls "cores" to enhance the availability of gigabit broadband services to ISPs.

The company has also rolled out a dark fibre-based fibre-to-the-tower network in Hull – the first of its kind in the UK, under a national framework with Mobile Broadband Network Limited (MBNL), a joint venture between Three UK and EE.

Vodafone, meanwhile, is currently in the process of spending around £2bn on its network and services around the country, in a two-year project to extend 4G mobile network coverage to 650 towns and cities, and many thousands of smaller communities.

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Vodafone takes a step backwards as other MNO's are moving away from Fibre to Microwave Links for their backhaul traffic as TDM technology is proving to be inefficient and Fibre will not be able to handle multi Gigabit backhaul traffic.
Also Ericsson says Fibre Technology will not dominate backhaul market by 2020 as multi-gigabit fronthaul and backhaul demand will be met by Microwave Networks and is the most cost-efficeint way.
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CityFibre don’t have any backhaul capacity to sell. It has a few Council Networks in several 2nd tier Cities which won’t get it very far. It does not have or own any long distance National or Trunk routes. It will need to lease lines from a third party i.e., BT or Level3 Communications.

Before it reaches that stage, it will probably run out of money.
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BT's backhaul networks (national, regional and local) are creaking at the seams as a result of the cuts in annual investment from 3 - 4 million, to 2.5 million (in 2008) to 1.25 million (in 2012) while traffic has soared. Without the investments now being made by City Fibre and others UK broadband will soon grind to a halt.
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