Italian government prepared to compromise on TIM role in single broadband network

28 Aug 2020

Italy’s government has green-lighted a proposal to create a single broadband network company which will now be presented in a Memorandum of Understanding (MoU) to incumbent operator Telecom Italia (TIM). State investment fund Cassa Depositi e Prestiti (CDP) has been at the heart of negotiations to merge TIM with wholesale broadband operator Open Fiber; CDP owns 50% of Open Fiber and has a minority stake in TIM.

According to a Reuters report, which cites several local newspapers, the plan put forward by CDP and approved by the government will restrict TIM’s control of the unit while still giving it majority ownership. TIM is known to favour retaining control of the merged unit, while Open Fiber wants an open access broadband provider which is wholly independent of TIM. Daily La Stampa said a strong state presence would be guaranteed thanks to CDP, and TIM would not be allowed a majority of board members in the future network.

Meanwhile, TIM is also discussing the future of secondary, or last mile, copper and fibre networks business, which it has dubbed FiberCop. Following on from news that the government has approved plans to sell a 37.5% stake in FiberCop to US investment fund KKR, TIM has now signed a MoU with Italian ISP Tiscali which could pave the way for its participation in the project. Another broadband provider, Fastweb, is already taking a stake in FiberCop thanks to its existing involvement in the Flash Fiber joint venture which has been deploying fibre-to-the-home (FTTH) networks across Italy.