How UK Wholesale Broadband Works: Openreach, CityFibre and the Anchor-Tenant Model

Three things confuse almost everyone about UK broadband. An engineer from a company you have never dealt with installs a service from a company you have. The same fibre costs different amounts from different brands. And which networks reach your street depends on deals between companies you cannot see. All three have the same explanation, which is that UK broadband is built in layers: one company owns the wire, sells access to it, and another company sells to you. This guide explains the layers, why one of the companies is regulated and the others are not, what an anchor tenant is and why it decides which networks get built, and how much of your bill goes to the network. It is the structure underneath every other page on this site.

What does "wholesale broadband" actually mean?

Direct answer: it means the company that owns the network does not sell to you. It sells access to the network to other companies, and they sell to you. Openreach describes its customers as communications providers, "the organisations that sell phone, broadband, data and TV services to homes and businesses", and BT's results put the number at more than 700.

The word wholesale is borrowed from retail, and the analogy holds. A wholesaler sells in bulk to shops, and the shops sell to the public. In broadband, the wholesaler owns the fibre, the ducts and the poles, and sells a connection over them to a retailer, who bundles it with a router, a support desk, a brand and a price, and sells that to you. You never see the wholesale price, and you never have a contract with the wholesaler, which is why Openreach's own installation page says it does not have access to your order and that your provider manages your appointment.

This is not the only way to run a broadband market, and it is not the only model in the UK. Some networks sell to you directly with no wholesale layer at all. But the wholesale model is the one that carries most UK connections, and the one Ofcom has spent twenty years shaping, so it is the one to understand first.

Who are the three layers, and which one do you have a contract with?

Direct answer: the network owner, the wholesaler and the retailer, and in the UK the first two are usually the same company. Your contract is with the retailer, always. The engineer who comes to your house works for the network, on the retailer's behalf.

The layers explain the engineer. When an Openreach van arrives to install a Sky, Vodafone or TalkTalk line, Sky's own terms say Openreach "may provide installation services on Sky's behalf". The engineer works for the network; the network works for the retailer; the retailer works for you. Complaints and rights run up that chain in the same order, which is why every consumer page on this site says to raise problems with your provider rather than with Openreach.

Why is Openreach regulated and the others not?

Direct answer: because Ofcom has found, and in March 2026 found again, that BT holds significant market power in the wholesale markets that matter. That finding brings obligations: equal treatment of every retailer, access to ducts and poles for rivals, and limits on pricing. CityFibre and every other builder have no such finding, so they sell access on terms they negotiate.

Ofcom reviews the fixed telecoms market every five years under the Communications Act 2003. The Telecoms Access Review 2026-31, published on 17 March 2026 and in force from 1 April, sets the rules to 2031. Its central finding is continuity: BT retains its significant market power designation across the relevant wholesale markets, and Openreach remains subject to access and pricing obligations. The review divides the country into areas by how much competition exists, from a high network reach area covering 9% of postcode sectors where rival networks are strong, to an area covering 34% of postcode sectors with little competition where Openreach must provide dark fibre and price on its reasonable costs. It extends the cap on what Openreach can charge for legacy copper broadband from 40 Mbps products to 80 Mbps products, tightens the rules on geographic discounts, and lengthens the notice Openreach must give before changing prices.

None of that applies to CityFibre, nexfibre or any altnet. They are not found to have market power, so the wholesale prices they charge Vodafone, Sky or Virgin Media O2 are private contracts. That asymmetry is the subject of a great deal of argument: Openreach says it is competing with one hand tied, and the altnets say the tie is the only reason they exist. Our page on Ofcom's intervention in Openreach's discounts covers the current round of that argument; this page only needs you to know that the asymmetry is deliberate and lasts to 2031.

What did legal separation change, and what did it not?

Direct answer: it made Openreach a separate company inside BT, with its own board, brand and staff and a duty to treat BT's retail arm exactly as it treats everyone else. It did not make Openreach independent of BT, which still owns it, funds it and reports its results.

Openreach's own account is the clearest. After Ofcom's Digital Communications Review, BT gave Ofcom a list of voluntary commitments, which included making Openreach a distinct company with its own staff, management, purpose and strategy. Openreach Limited was incorporated in 2017 as a wholly owned subsidiary of BT plc. A committee of Openreach's non-executive directors monitors compliance with those commitments, looks at complaints from communications providers, and publishes annual reviews. The principle underneath, which dates from BT's 2005 undertakings and the original creation of Openreach in 2006, is that any product Openreach offers must be available on the same terms to every provider, so that BT Consumer gets the same service as its rivals and no better.

What separation did not do is change who owns the asset or where the money goes. Openreach's results are BT's results, and BT's chief executive talks about Openreach's fibre build as BT's investment. For a consumer the practical meaning is simple: an Openreach engineer installing a TalkTalk line is not doing TalkTalk a favour, and a Sky customer's fault is not queued behind a BT customer's. The rules say so, a committee checks, and Ofcom can act if they are broken.

What is an anchor tenant, and why does it decide which networks survive?

Direct answer: an anchor tenant is a large retailer that commits to sell over a new network across its footprint before the network is built. That commitment is what turns a plan into something a bank will lend against. Without one, a wholesale network is a bet with no customer.

The term comes from shopping centres, where a department store signs first so that the developer can borrow to build the rest, and it maps exactly. A wholesale fibre network costs billions to build and earns a few pounds a month per line, so it can only be financed against demand that is already promised. Vodafone became CityFibre's anchor tenant in 2017, and in 2021 extended the arrangement to CityFibre's entire footprint. TalkTalk followed. In 2025 Sky began selling over CityFibre, and ISPreview reported that CityFibre's fourth quarter of 2025 saw more than 50,000 new customers installed a month, up 112% on the year, with Sky's arrival credited. In July 2025 CityFibre secured a £2.3 billion funding package. The sequence is not a coincidence. The retailers came first, the money came second, and the build came third.

nexfibre is the same model with a single tenant. It is a joint venture of Liberty Global, Telefonica and InfraVia, and Virgin Media O2 is its sole wholesale partner, which is why the CMA is examining whether nexfibre may buy Netomnia: the deal would give Virgin Media O2's owners the network under 3.4 million more premises. And the model works in reverse. A network that loses its anchor, or never finds one, is a network that consolidates or fails, which is the pattern our consolidation report describes. When you read that an altnet has been sold to its lenders, the question underneath is almost always who was selling over it.

How does CityFibre's model differ from Openreach's?

Direct answer: CityFibre is wholesale only by design, sells to dozens of retailers on commercial terms, and is owned by infrastructure investors rather than by a retailer. Openreach is wholesale by regulation, sells to more than 700 retailers on terms Ofcom polices, and is owned by its largest customer.

The scale row is the one to sit with. Openreach's full fibre reached 23.4 million premises by June 2026, with 9.4 million connected and a take-up rate of 40%, and BT expects 25 million by December. CityFibre passed almost 5 million with more than a million connected. That is the difference between a national network and a large regional one, and it is why the anchor tenants matter so much: a retailer with a national brand is the only thing that lets a regional network fill up fast enough to pay its debt.

What about networks that sell direct?

Direct answer: they collapse the three layers into one. Hyperoptic and Community Fibre build their networks and sell to you; Virgin Media does the same on its own cable network; YouFibre sells over Netomnia's network under common ownership, at least until the CMA decides. You get one company to deal with, and one company to choose from on that wire.

Vertical integration is the oldest model in telecoms and it has real advantages for a customer. There is no one to blame but the company you pay, faults are not passed between a retailer and a network, and installation and support are one organisation. The disadvantage is structural. If you want to leave the provider, you leave the network, which usually means a new install from someone else. There is also a version in between: nexfibre is wholesale in form but has one retailer, Virgin Media O2, so from a customer's point of view it behaves like a vertically integrated network with a subsidiary that owns the fibre. Whether it stays that way after the Netomnia decision is one of the things to watch in December.

What is PIA, and why does it matter to the whole system?

Direct answer: physical infrastructure access is the regulated right of any network operator to run its own fibre through Openreach's ducts and along its poles, at cost-based prices, with a strict rule against Openreach discriminating between users. It is how most of the rival networks were built, and it is why a competitor's fibre so often arrives on the same pole as Openreach's.

Ofcom made PIA the primary remedy in its 2021 review and kept it in 2026, confirming that Openreach must continue to allow all network operators, with a strict anti-discrimination obligation, to deploy and operate their own fibre using its infrastructure. The logic is that the expensive part of a network is the civil engineering, and Openreach's ducts and poles were paid for over a century by a monopoly. Letting rivals rent space in them, rather than dig their own, is what made a second and third network affordable in most towns. It is also why the wholesale structure is not a neat set of separate companies: CityFibre's fibre runs through Openreach's ducts, and the price CityFibre pays for that space is one of the things Ofcom regulates. For a community trying to build its own network, PIA is available only through a licensed operator, and our community fibre playbook explains how that works.

How much of your bill goes to the network?

Direct answer: on an Openreach line, £17.70 a month on average. That is Openreach's broadband revenue per line for the quarter to June 2026, from BT's own results, up 7% on the year because of higher full fibre take-up, faster speed tiers and price rises. Everything above it on your bill is the retailer's.

This is the single most useful number in the whole structure, and it is published four times a year by BT to its shareholders. It is an average across every product Openreach sells, so a full fibre line at a high speed costs the retailer more than the average and an old copper line costs less. It also includes the effect of CPI-linked wholesale price rises, which is one reason retail price rises exist. But as a rule of thumb it tells you that when you pay a retailer somewhere in the thirties for a full fibre line, roughly half is the wire and roughly half is the retailer's own network, support desk, router, marketing and profit. Two retailers on the same Openreach line pay Openreach similar amounts. Everything that differs between them is on the retailer's side of the split.

CityFibre's equivalent number is private, because its contracts with Vodafone, Sky and TalkTalk are private, and that is the point of not being regulated. What can be said is that a retailer choosing between two networks at the same address is comparing two wholesale prices you will never see, and that the anchor tenants negotiated theirs before the network existed.

Why does the same network appear under different brands at different prices?

Direct answer: because the network charge is only part of the price and the rest is the retailer's decision. The wire is identical. The router, the support, the contract length, the annual rise, the speed guarantee and the price are all chosen by the brand, which is why comparing brands on the same network is worth doing.

This is the practical consequence of the structure and the one that most directly affects your bill. Two providers on the same Openreach line have the same underlying speed, the same reliability of the physical connection, and the same Openreach engineer when it breaks. They differ in what happens between the ONT on your wall and the internet, which is their own network, and in everything commercial. One may include a better router, one may offer symmetrical speeds the network supports and the other does not sell, one may have joined Ofcom's voluntary codes and the other not. Our list of who uses Openreach exists so that you can compare like with like, and our comparison with the altnets covers what changes when the wire itself is different.

What does the wholesale structure mean when you switch?

Direct answer: switching between two retailers on the same network is usually a paperwork change with no new install, because the wire and the box on your wall stay put. Switching between networks means a new line and usually an engineer. One Touch Switch handles both, but the first is faster and the second is a bigger decision.

Knowing the layers turns a confusing switch into a predictable one. If you are on Openreach with one brand and move to another Openreach brand, the ONT stays, the fibre stays, and the change happens at the retailer's end; you may get a new router in the post and little else. If you move from Openreach to CityFibre, or to Virgin Media, a new network has to reach your house, which means a new external box, a new hole and an engineer, and the question of where the new box goes. Neither is wrong. The first is how you get a better price for the same wire; the second is how you get a different wire. The mistake is not knowing which one you are about to do.

Where does this leave you?

Direct answer: with the map. One company owns the wire under your street, or two or three do. A larger number of companies sell over it. You choose among the sellers, and the network is their supplier rather than yours. The first thing to find out about any address is which networks reach it, because that decides everything else.

The layers are why UK broadband looks the way it does: an Openreach van outside a Sky customer's house, a Vodafone deal that exists because Vodafone signed with CityFibre before the fibre was laid, a bill of which £17.70 goes to a company you have never spoken to. None of it is hidden; it is simply never explained. Now that it has been, the comparison is easier. Start with the wire.

Frequently asked questions

What does wholesale broadband mean?

It means the company that owns the network sells access to it to other companies, who sell broadband to you. Openreach, for example, builds and runs the wires and sells connections over them to more than 700 communications providers, from BT itself to the smallest independent. You never have a contract with Openreach. You have one with the retailer, who pays Openreach a wholesale charge for your line and adds its own costs and margin on top.

Who do I actually have a contract with?

The retailer, always. If you buy from Sky over Openreach, your contract is with Sky; Openreach installs and repairs the line on Sky's behalf and its own page says it does not hold your order. The same applies on CityFibre, where you buy from Vodafone, Sky, TalkTalk or one of dozens of smaller brands, and on nexfibre, where Virgin Media O2 is the retailer. Only where the network sells direct, as Hyperoptic and Community Fibre do, is the network also your provider.

Why is Openreach regulated but CityFibre is not?

Because Ofcom has found that BT, which owns Openreach, holds significant market power in the wholesale markets that matter. Its Telecoms Access Review 2026-31, in force from 1 April 2026, keeps that finding and the obligations that go with it: to give every provider access on equal terms, to let rivals use its ducts and poles, and to accept limits on pricing. CityFibre has no such finding, so it sells access on commercial terms it negotiates itself.

Is Openreach part of BT?

Yes, and legally separate at the same time. Openreach Limited is a wholly owned subsidiary of BT plc, created after Ofcom's 2017 review under commitments BT gave to Ofcom. It has its own board, brand and staff, is required to treat BT's own retail arm exactly as it treats every other provider, and a committee of its non-executive directors monitors compliance and publishes annual reviews. BT still owns it and reports its results.

What is an anchor tenant in broadband?

A large retailer that commits to sell over a new network across its footprint before the network is built, giving the builder the guaranteed demand it needs to borrow the money. Vodafone became CityFibre's anchor tenant in 2017 and extended it to the whole footprint in 2021. Sky began selling over CityFibre in 2025. Virgin Media O2 is nexfibre's sole wholesale partner. Without an anchor tenant, a wholesale network is a bet with no customer.

How much of my broadband bill goes to Openreach?

On average, £17.70 a month. That is Openreach's broadband revenue per line for the quarter to June 2026, as reported by BT, up 7% on the year because of higher full fibre take-up, faster speed tiers and price rises. It is an average across every product, so a full fibre line costs the retailer more than an old copper one. Whatever you pay above that covers the retailer's own network, support, router, marketing and profit.

Why does the same network cost different amounts from different providers?

Because the network charge is only part of the price and the rest is the retailer's decision. Two providers on the same Openreach or CityFibre line pay similar wholesale charges and then set their own prices, contract lengths, annual rises, routers and support. The wire is the same; the company you deal with is not. That is the point of the wholesale model, and it is why comparing brands on the same network is worth doing.

What is physical infrastructure access?

PIA is the regulated right of any network operator to run its own fibre through Openreach's ducts and along its poles at cost-based prices. Ofcom introduced it as the main remedy in 2021 and kept it in the 2026 review, with a strict rule against Openreach discriminating between users. It is how most rival networks were built without digging up every street, and it is why a competitor's fibre often arrives on the same pole as Openreach's.

How big are Openreach and CityFibre?

Openreach's full fibre network reached 23.4 million premises by June 2026, with 9.4 million connected, a 40% take-up rate, and a target of 25 million by December 2026. CityFibre's reached almost 5 million premises by June 2026 with more than a million connected. nexfibre, if it completes its purchase of Netomnia, is targeting 8 million by the end of 2027. Openreach is the only national network; the others are large regional ones.

What is a vertically integrated network?

One that builds the network and sells to you itself, with no wholesale layer. Hyperoptic and Community Fibre are examples, as is Virgin Media on its own cable network, and YouFibre on Netomnia's network until the CMA decides whether nexfibre may buy it. The advantage is one company to deal with. The disadvantage is one company to choose from on that wire, so if you want to leave the provider you must leave the network.

Does the wholesale structure affect switching?

Yes, in a way that helps. Switching between two retailers on the same network is usually a paperwork change with no new install, because the wire and the box on your wall stay put. Switching between networks means a new line and often a new engineer visit. One Touch Switch handles both, but the first is faster. Knowing which network your provider uses tells you which kind of switch you are about to make.

Why does any of this matter to me?

Because it explains the three things people find confusing about UK broadband: why an engineer from a company you have never heard of installs a service from a company you have, why the same fibre costs different amounts from different brands, and why the choice of networks at your address depends on deals between companies you cannot see. Once you know which network is under your street and who sells over it, every comparison gets simpler.

References

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Written by Adrian James, Broadband Editor at BroadbandSwitch.uk (LinkedIn). Reviewed by Dr Alex J. Martin-Smith (LinkedIn). Published 7 September 2026, last verified 7 September 2026. Footprint and take-up figures are as reported by the companies at the dates given and change quarterly. This guide is information, not advice. BroadbandSwitch.uk has no commercial relationship with any network operator.