{"id":99866,"date":"2026-07-08T14:41:11","date_gmt":"2026-07-08T14:41:11","guid":{"rendered":"https:\/\/www.europesays.com\/ch\/99866\/"},"modified":"2026-07-08T14:41:11","modified_gmt":"2026-07-08T14:41:11","slug":"ubs-warns-of-wholesale-threat-to-broadband-profits-stays-negative-on-bt-and-vodafone","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ch\/99866\/","title":{"rendered":"UBS warns of wholesale threat to broadband profits, stays negative on BT and Vodafone"},"content":{"rendered":"

\"UBS<\/a> UBS warns of wholesale threat to broadband profits, stays negative on BT and Vodafone Proactive uses images sourced from Shutterstock <\/p>\n

UBS has flagged mounting pressure on UK retail broadband pricing from proposed cuts to wholesale charges, reinforcing ‘sell’ ratings on both BT Group PLC (LSE:BT.A)<\/a>\u00a0and Vodafone Group PLC (LSE:VOD)<\/a>. <\/p>\n

The bank published its quarterly review of UK broadband and mobile pricing, describing a market that remains intensely competitive. <\/p>\n

Alternative networks and mobile virtual operators are pricing more than 30% below the major players in broadband and mobile respectively. <\/p>\n

Broadband pricing recovered somewhat in July after cuts in June, with BT, Vodafone and Sky raising selected tariffs by \u00a31 to \u00a33 a month. <\/p>\n

The central concern is a set of wholesale promotions proposed by Openreach, BT’s network arm, which are subject to approval by the regulator Ofcom. <\/p>\n

These include a cap of \u00a319.32 a month on the line rental internet providers pay for new and upgraded fibre lines from 1 July. <\/p>\n

From October, Openreach also proposes further discounts of \u00a39.50 a month to providers that exceed set volume thresholds, effectively halving pricing to lock in minimum volumes. <\/p>\n

UBS said the moves should help reduce line losses at Openreach but would remove revenue growth and hurt BT’s consumer business. <\/p>\n

The bank drew a parallel with September 2025, when retail broadband pricing stepped down after Sky moved subscribers onto rival CityFibre’s network. <\/p>\n

On BT, which UBS rates ‘sell’ with a 175p price target, the bank sees weakening earnings trends into the first half of the 2027 financial year. <\/p>\n

It expects core earnings to fall around 2% amid marketing investment and top-line pressure, before a recovery in the second half. <\/p>\n

UBS also rates Vodafone ‘sell’, with a 95p target, citing slowing momentum in Germany and a lack of positive catalysts after the end of its share buyback. <\/p>\n

It noted that both companies’ dividend yields have rarely traded below 10-year gilt yields, which it expects to constrain the shares. <\/p>\n

On Liberty Global (NASDAQ:LBTYA)<\/a>, owner of Virgin Media O2, UBS stayed ‘neutral’ and trimmed its price target to $12.10 from $12.60. <\/p>\n

The bank pointed to continued pressure on cable revenues in the UK and complexity around a fibre deal with Nexfibre and Netomnia. <\/p>\n","protected":false},"excerpt":{"rendered":"UBS warns of wholesale threat to broadband profits, stays negative on BT and Vodafone Proactive uses images sourced…\n","protected":false},"author":2,"featured_media":99867,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[129],"tags":[49397,34741,26912,223,49396,49395],"class_list":["post-99866","post","type-post","status-publish","format-standard","has-post-thumbnail","category-ubs","tag-broadband-pricing","tag-bt-group-plc","tag-openreach","tag-ubs","tag-uk-broadband","tag-vodafone"],"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@ch\/116884883775122935","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/99866","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/comments?post=99866"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/99866\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media\/99867"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media?parent=99866"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/categories?post=99866"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/tags?post=99866"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}