Proximus and Telenet want to jointly expand fiber optics outside the Flemish cities. This should reduce the workload, but should be more economically interesting for the providers involved.

Proximus, Telenet, Wyre and Fiberklare sign a Memorandum of Understanding Accelerating fibre roll-out in medium to low population density areas in Flanders. The parties representing the majority of fibre-to-the-home ambitions in Flanders aim to reach 2.7 million households together.

Faster and less disruption

The fiber optic rollout will be complementary. The parties involved would then gain access to each other’s networks through wholesale agreements. Proximus and Telenet, for example, hope to roll out fiber optics more quickly while public works remain limited.

The collaboration could also reduce the cost of fiber-optic deployment. In less densely populated areas, fiber-optic deployment requires significant investment with a much lower return compared to fiber-optic installation in cities. By collaborating, the major providers can share the costs.

Allocation of roles

Proximus and Telenet are relying on Fiberklare (of which Proximus recently became the sole owner) and Wyre respectively for the collaboration. Wyre is a joint venture between Telenet and the utility company Fluvius. Fiber-ready and Wyre will supply around two million homes with fibre optics as part of the agreement. Wyre will be responsible for sixty percent of this work.

For 700,000 homes in sparsely populated areas, providers want a different approach. Proximus wants to offer services there via Wyre’s Hybrid Fiber Coax (HFC) network. So there does not seem to be an intention to equip these homes with real fiber optic networks immediately, even though the existing coaxial technology also enables gigabit speeds.

Waiting for approval

The Memorandum of Understanding did not come out of the blue. Belgian providers have been sitting together at the table to discuss cooperation for some time. The door to such cooperation has been open since BIPT and BMA announced in 2023 that they could be open to it.

However, the planned agreements are subject to the approval of the competition authorities. The providers will now work with the BIPT and the BMA to investigate the collaboration. Proximus and Telenet will only provide further details once the criticism is included in the formal agreement. Proximus expects this to happen in the last quarter of this year at the earliest.

Danger of less competition

Cooperation between telecommunications providers is sensitive. On the one hand, our country wants to ensure competition in the market. Different providers, each with their own infrastructure, can stimulate competition. On the other hand, fiber optic expansion, especially outside of cities, is a very costly affair, the investment of which is difficult for a single party to bear. In this case, cooperation enables a faster and more comprehensive rollout.

The competition authorities must now assess the agreement. It will be important that the parties involved provide sufficient guarantees of openness and competition to justify the joint infrastructure project.