But the telco is slowing down fibre infrastructure capex as it seeks new investment
Reykjavik Fibre Network (Ljósleiðarinn) has deployed Nokia’s Lightspan fibre solution and Altiplano access controller which will give it the ability to upgrade to 25Gbps services in the future using software defined networking.
However, the telco announced it intends to reduce investments until a result is obtained in the planned share capital increase, which has been significantly delayed. Earlier this month, the Orkuveitun subsidiary reported a loss of ISK 570 million in 2023, compared to a loss of ISK 87 million in 2022. This was despite revenue increasing by 13% year-on-year and amounted to ISK 4.3 billion last year.
All of the country’s largest service providers use Reykjavik Fibre Network’s backbone network and last year the telco also completed the purchase of Sýnar’s core network after approval of the transaction by the Competition Authority.
As a result, the optical fibre is now entirely owned by Orkuveitinn, but the authorisation to increase the share capital and sell it is valid until the end of the current year. Over the past few months, Reykjavik Fibre Network’s managers have had briefings with domestic and foreign investors in the market.
Commenting on the delay to the plans to increase the share capital Reykjavik Fibre Network chief executive Einar Þórarinsson said: “The purchase of Sýnar’s core network was important for the development of Ljósleiðar, strengthened competition and increased electronic communications security in the country. The share capital increase was clearly designed to strengthen the finances in connection with this investment and other profitable developments for the future.”
He added: “We are looking forward to having a conversation with the new co-owners of Orkuveitunna about the company’s continued development, as the need for a reliable telecommunications infrastructure is only growing.”
Big delays
According to local media reports, further fibre investment will hinge on the much-delayed share capital increase. The telco has stated that it will use part of the proceeds of the capital increase to pay off debts. It first announced the capital increase back in 2022 and the plan was to complete the capital increase by the end of the first quarter of 2023.
However, the final approval of the owners of Orkuveitun – including the City of Reykjavík – was not received until the beginning of May. Last September, the board’s updated proposal for the share capital increase was approved which meant the new share capital can amount to a maximum of 33.3% of the total share capital of the telco post-injection. The aim is for distributed ownership among prospective shareholders.
Software-defined fibre network
Nokia’s Lightspan FX solution supports multiple generations of PON technologies and point-to-point applications simultaneously, so Reykjavik Fibre Network can better utilise its network and quickly add capacity whenever or wherever it’s needed.
Nokia’s Altiplano Access Controller is a software-defined and network function virtualisation system used to drive greater automation and virtualisation. The network is managed with an open API to automate and program it. Additionally, enhanced automation tools and network insight capabilities help improve the management, scalability and reliability of Reykjavik Fibre Network’s network.
“For residential and business services as well as cell-site backhaul. Nokia’s solution not only facilitates this but also lays the foundation for a future-proof network infrastructure, aligning seamlessly with our vision of a network controlled by software infrastructure, accessible to our wholesale customers through our existing APIs and OSS systems,” said Reykjavik Fibre Network CTO Jon Ingi Ingimundarson.
“Our fibre technology provides the perfect solution for operators that want to quickly increase capacity and flexibly migrate to next-generation fibre technologies like 25G PON,” added Nokia GM of broadband networks Geert Heyninck.