Digital Infrastructure · Fibre networks

What flows through a fibre network — and how it pays

A fibre builder passes homes with cable, then signs them up. Connected premises pay a recurring monthly subscription — a long-life annuity — but the network costs the same to run whether full or empty. So the economics turn on penetration (take-up of the homes passed), the ARPU achieved, and how many homes you've built past: low take-up is loss-making, but every new connection drops almost straight to EBITDA.

35%
£30
200k
LIVE
Connected home subscribing (lit) Data on the fibre to/from the internet Subscriber £ broadband + business Operating cost
Flows — annualised from current assumptionsper year
Revenue p.a.
£0
£0 / hr
EBITDA p.a.
£0
0% margin
Revenue / conn·mo
£0
blended ARPU
Connections
0
35% penetration
Stocks — what the flows accumulate intolive
Connections now
0
live, of 200k homes passed
EBITDA banked · session
£0
accumulating in real time
Implied enterprise value
£0
at 16× EBITDA
Where revenue comes from Total £0 p.a.
Consumer broadband
Business & wholesale
Why investors like it: recurring consumer subscriptions on a future-proof, low-churn fibre network are an inflation-linked annuity, with a higher-value business and wholesale layer on top. But the build is capital-heavy and the network's running costs are largely fixed — so the whole investment case hinges on penetration: passing homes burns cash, connecting them creates the value.
Revenue streams£0 p.a.
Operating costs£0 p.a.
Investment case — should you buy it?DCF returns

Year-1 financials flow live from the simulation above: revenue £0 and EBITDA £0 p.a. Set your deal terms below — the unlevered IRR (asset return) and levered IRR (return to equity, after debt) recompute instantly.

Operating

%
%
%
%
%
%

Valuation & hold

×
×
y

Financing

×
%
%
Unlevered IRR
—
asset / project return
Levered IRR
—
return to equity
Equity multiple
—
MOIC over hold
Equity gain
—
exit equity − invested
Equity cash-flow profile£m · ■ invested   ■ returned
Projection — £m per year

Illustrative model. Represents a full-fibre (FTTP) network with a build footprint of homes passed and a take-up (penetration) that converts them into paying connections. Revenue = connections × ARPU, split into consumer broadband and a business & wholesale layer. Network maintenance and business rates scale with homes passed (fixed against take-up); customer operations, content/transit and sales & marketing scale with connections — so margins swing hard with penetration (it can be loss-making before the network fills). EBITDA = revenue − operating costs; excludes the upfront build capex. The investment case is a simplified DCF. For illustration only — not investment advice, and not any specific asset.