Network Rail Seeks Partner to Help Upgrade Trackside Network

In what seasoned trackside network commentators are describing as “The big one”, Network Rail has announced it will seek a private investor to help upgrade 16,000km of trackside cable network. The deal could net the company over £1 billion and, NR says, will help improve reliability, performance and safety for its frontline workers and passengers.

The move could also help to support the rollout of gigabit broadband and 5G mobile across the UK. However, it remains to be seen how highly an array of likely competing bidders will actually value the asset. NR will retain ownership of the network.

The current trackside data infrastructure - a tangle of legacy copper and some fibre optic - is used to carry CCTV, signalling and other communications. There is no doubt that it is in need of an upgrade.

Some five years ago, NR seemed all set to sell its cable links or enter into a joint venture to build them up. However, despite several large telecoms companies coming to the table, no agreement was reached and the plan was put back on the shelf.

It is understood that under the new plan NR will retain ownership and access to the cables, but the new investor will have access to spare capacity. However, the investor will also assume responsibility for upgrading the cables and replacing the remaining copper lines with fibre optics as well as rolling out 250 new wireless masts alongside the train-tracks.

As Andrew Haines, Network Rail’s CEO put it, “Our telecoms infrastructure requires an upgrade if we are to meet the growing connectivity needs of passengers and the railway itself – particularly to make sure our fibre capacity can handle more data, at greater speed, more reliably.

This proposal makes good business sense for all parties. We get a cutting-edge, future-proof telecoms infrastructure; the investor gets a great business opportunity; train passengers in Britain get an improved service for years to come; and the taxpayer saves a significant amount of money.

Only last year, the year the National Infrastructure Commission (NIC) put out a statement questioning whether the UK Government would be able to meet its much-reported 2017 pledge to make “uninterrupted” WiFi and Mobile (5G) broadband speeds of up to 1Gbps available on-board all UK mainline train routes by 2025.

However, it remains to be seen how highly telecoms companies value access to a very specific network, which passes through many miles of remote rural hinterland as well as urban areas which are already very well served with high-speed fibre links.

Transport Secretary Grant Shapps said: “Upgrading the fibre optic cable network beside our railways has the potential to create a more digitally-connected railway, and could lay the foundations towards eradicating the blackspots and phone signal outages which infuriate passengers"

He went on, "Unlocking the skills and expertise of the private sector will benefit passengers and help create a modern railway that connects the country.”

Certainly, it seems to make a great deal of sense to take on board a private partner in the bid to bring the rail-side telecoms network up to speed. The use of existing and new trackside mobile masts should help improve the delivery of passenger WiFi to trains, as well as helping to usher in a new generation of wirelessly delivered services to and from the trains.

RailTel, the newly-privatised communications wing of Indian Railways recently announced a similar scheme when it revealed plans to offer high-speed broadband and WiFi services in remote villages. RailTel said it will use its vast fibre-optic network to facilitate fast connections in India’s rural hinterland.

Meanwhile, all parties interested in the NR auction are advised to contact Lazard – Network Rail’s advisers on the deal – t lazard_reach@lazard.com.