Matthew Hare founded alternative network broadband provider Zzoomm in 2018. Photo: Clint Randall
BT challenger Zzoomm lays off hundreds of engineers as smaller broadband companies grapple with financial crisis.
Oxfordshire company that rolls out fiber internet connections across the UK to start outsourcing building your network in an attempt to save money.< /p>
About 300 construction crew members, including engineers and office workers, will be laid off, equivalent to more than 50 percent of the company's employees.
Bosses have begun a 45-day consultation process, but employees are informed in one-on-one meetings whether they continue work or not.
Zzoomm, which is majority owned by the American management company Oaktree Capital. Management was launched in 2019 with a focus on market towns such as Henley upon Thames.
It was created by Matthew Hare, founder and former CEO of Gigaclear, a rural fiber optic network.
p>
Zzoomm currently has about 11,000 customers and a network of 135,000 properties, with a level of service is about 7 percent. The company aims to acquire one million properties by 2025.
In 2021, a consortium of banks led by ING raised £100m to speed up construction.
But cuts are coming. against a backdrop of more serious problems for so-called “alternative” broadband providers struggling with rising borrowing and construction costs, as well as fierce competition from the incumbent BT.
Funding cuts are expected to spark a wave of consolidation across throughout the industry.
Earlier this year, Zzoomm was linked to a possible bid for broadband company Trooli, which was eventually bought by French infrastructure company Vauban in a £100m deal.
The Telegraph reported last month that that Virgin Media O2 has been in talks with Cityfibre for a takeover deal that could be worth up to £3bn.
Philip Kars, an analyst at Megabuyte, said that alternative chains are facing a “fractional funding crisis”.
p>< p>He said: “The climate has really changed a lot in the last nine months after all the turmoil last fall plus rising interest rates. This means that what has been a near-endless influx of capital into alternative networks is becoming increasingly difficult to come by.
“If that funding is a little more expensive or a little harder to get, then you are essentially saving money.”
A Zzoomm spokesperson said the company expects faster growth this year than in 2022, adding that it is actively recruiting for some positions and is considering acquisitions as part of its growth strategy.
Recent Comments