There are more than a hundred altnets — the result of years of low-cost funding — battling with a rapid escalation in the cost of capital, as well as fierce competition from BT’s Openreach and each other. They collectively racked up £1.5bn of net losses and burned through £3bn of cash in 2024, according to Enders Analysis.   

The reason consolidation is not happening is that it is hard to agree on price. As a group, altnets are unlikely to be worth the sum of the investments they have made, many of them debt financed. Indeed, the sector is trying to balance £9bn of net debt, according to Enders Analysis, on £544mn of revenue and negative operating profit. Even with the benefits of merging, it is hard to see these numbers stacking up. 

Enders Analysis, the consultancy firm, has estimated that the combination of the Telegraph Media Group and DMGT would create a group controlling 30 per cent of the total revenues generated from the national newspaper market.

“The buying-up of vodcasts is a direct response by Netflix to the threat of YouTube, by providing more ‘ambient’ or background content to its subscribers,” says Tom Harrington, analyst at Enders Analysis. He suggests it will also help answer a few nagging questions about podcasts.

“Big podcasts are pushing the boat out more in terms of video production, which means they are turning into TV shows,” Harrington says. “Everything is television now.”

The mainstream view in the telecoms industry is that satellite broadband will never be a mass market proposition. “In fixed broadband, satellite costs are still a multiple of the average costs of traditional networks, only becoming competitive for a proportion of the hardest 1pc of households to reach,” argued a note from Enders Analysis. Well, perhaps. For now, it is certainly true that providing broadband access via satellite is much more expensive than via a fibre-optic cable running along your street. It will struggle to attract more than a handful of customers living in very remote areas.

The UK’s “altnet” broadband sector is struggling with a net debt of more than £9bn, according to data from Enders Analysis, following rapid growth after the pandemic.

Karen Egan, head of telecoms at Enders Analysis, said the G.Network case had shown “that lenders can act quite decisively and are relatively quick to accept harsh writedowns once hope is lost.” 

 “While it’s painful for equity investors in particular right now in the altnet space, once the challenging economics of most of these ventures becomes irrefutable, the faster an alternative course is taken the better it is for all concerned,” she added.

“It’s one of those really interesting areas that flew under the radar for slightly too long because it hadn’t been considered an explicit thing,” Claire Holubowsky, a senior analyst at media strategist Enders Analysis, tells City AM “But all the conditions for its success have been there for 20 years.”

“Advertising is a much higher margin business,” says Holubowsky. “A lot of the significance to supermarkets isn’t quite visible yet. But then that’s beginning to change as everyone realises that retail media is big. And it’s not going away.”

“It’s clever of Amazon to include free television. This kind of partnership costs the distributor relatively little, but it allows them to keep users longer in order to then sell them other products,” explains François Godard, an analyst at Enders.

Karen Egan, at Enders Analysis, said: “There are certainly a lot of alt-nets out there that are really struggling financially and hoping that they will be bought. G Network is a reminder that there won’t be a buyer for all of them.”

But no good deed goes unpunished and competition for territory among Openreach, Virgin Media 02 and the altnets has been intense and costly. “I cannot tell you how crazy a market it is out there,” says Karen Egan, head of telecoms at Enders Analysis. The altnets suffered £1.5bn net losses in 2024, while Openreach lost a net 828,000 customers in that year.

The UK has a related challenge. The saying goes that “if you build it, they will come” but not enough have. Only 38 per cent of homes and businesses that could now connect to full fibre through Openreach have done so, while the altnets achieved only 15 per cent take-up by the end of 2024, according to Enders.