BT Stemming Broadband Losses as Challenger Networks Face Financial Headwinds
BT Group has reported a modest slowdown in the rate of broadband customer losses, a sign that the intense competitive pressure from a wave of upstart 'alternative network' providers may be easing as the challengers themselves face a financial reckoning.
The former state monopoly lost 210,000 retail broadband customers in the final quarter of 2025, an improvement from the 240,000 shed in the previous three months. For the full year, BT now expects its broadband base to shrink by 850,000, slightly better than its earlier forecast of a 900,000 decline.
This shift comes against a backdrop of growing distress in the 'alt-net' sector. Dozens of these companies emerged in recent years, fueled by cheap debt, to build rival full-fibre networks and undercut BT on price. Now, with interest costs soaring and customer uptake slower than anticipated, many are struggling. London-focused G.Network recently fell into administration, while industry consolidation is accelerating, exemplified by Virgin Media O2's £2bn deal to acquire Netomnia.
"The alt-net gold rush is hitting reality," said Michael Thorne, a telecoms analyst at Sterling Insights. "The economics of building a nationwide network from scratch are brutal. BT, with its existing scale and infrastructure, is in a position to weather this storm better than most."
The figures will offer some respite to Chief Executive Allison Kirkby, who is entering her third year leading the 180-year-old telecoms behemoth. Under her 'Back to Growth' strategy, BT has pledged to rein in capital expenditure on its own full-fibre rollout, slash £3bn in costs, and boost shareholder returns. The company connected another million premises to its full-fibre network last quarter, keeping it on track to reach 25 million by year-end.
However, challenges remain. Group revenue fell 4% to just under £5bn, pressured by lower consumer income and weak demand for mobile handsets. Pre-tax profit also took a significant hit, dropping to £183m, largely due to losses at its TNT Sports joint venture.
User Reactions:
"Finally, some positive momentum. Kirkby's cost-cutting focus was necessary, but the market needs to see customer numbers stabilize. This is a step in the right direction, though the revenue decline is worrying." – Sarah Chen, Portfolio Manager
"A slowdown in losses isn't a win—it's merely failing slower! This is a company clinging to its past. While rivals consolidate and innovate, BT is cutting investment and doing brand 'refreshes' to celebrate being old. That's not a strategy for the future." – David Reeves, Tech Commentator
"The alt-net shakeout was inevitable. It creates a more rational market. BT's scale and EE mobile assets give it a solid foundation, but execution on service and innovation is now critical." – Priya Sharma, Communications Consultant
In a separate update, Vodafone reported a 7.3% rise in group service revenue, buoyed by its UK merger with Three. However, its performance in the crucial German market remained sluggish, sending its shares down 6%.
As the sector consolidation continues, the pressure is on BT to define its future role—whether as a lean infrastructure champion or a integrated consumer services leader—in a rapidly evolving landscape.