news


TIM calls for investors to share FTTH cost burden

TIM is pushing ahead with plans to roll out fibre-to-the-home (FTTH) in urban areas of Italy through its new FiberCop unit, via a shared investment model.

The Italian incumbent has published the conditions for new investors interested in taking part in the project and has at the same time shared its plans with regulator AGCOM, whose role it will be to ensure they comply with the new European Electronic Communications Code. TIM says the initiative is based on the open investment model envisaged by the code, and is heralding it as the first nationwide project of its kind in Europe.

The move comes ahead of the launch of FiberCop, the new entity set up to control TIM’s access network, which is due to take place imminently. TIM will control FiberCop, with a 58% stake, while investment firm KKR will hold a 37.5% stake and rival network operator Fastweb will take 4.5% in return for contributing its share of the Flash Fiber FTTH joint venture between itself and TIM.

The firms are looking for new players to share the cost of investing in fibre.

This particular project covers the deployment of FTTH to homes and businesses in 1,610 Italian municipalities by 2025, reaching around 75% of properties in grey and black areas of the country, grey areas being those served by one high-speed broadband provider and black areas by more than one. TIM’s proposal provides for the supply of wholesale FTTH access.

Essentially, we’re looking at potentially lucrative areas here, in towns and cities, and TIM is looking to share the cost of filling out FTTH coverage, or, this being Italy, where in-building access is not always possible due to the age and style of the buildings, FTTB in some cases.

“The project is aimed at all market operators. The fibre network architecture that will be adopted is suited to reconciling the objectives of efficiency and promoting infrastructure competition between operators, while also simplifying retail customer migration processes between different suppliers,” TIM said, in a statement.

Companies interested in co-investing will not be required to participate in the whole project, but can select smaller areas that are relevant to them, down to the level of an individual municipality. As such, the project is open to small, local operators as well as the bigger players.

Investors do not have to sign up immediately, but should they choose to join the project at a later date they will be charged a fee to reflect the costs they would have paid over the whole scope of the project. This is in line with the new European Code, which requires the co-investment model to be based on effective sharing of the long-term risk of FTTH building, TIM said. The fee for latecomers “reflects the fact that the initial investors accept greater risks and commit their capital before the others,” TIM explained.

Late last year Tiscali announced that it will invest in FiberCop, essentially channelling its fibre network capex into the business, rather than pushing forward with its own network deployment. However, there has been no comment from the Sardinia-based ISP on this latest investment announcement from TIM. Further, there has been no new information on the possibility of Tiscali taking an ownership stake in FiberCop, something that has been rumoured for some time.

Late last year Italy’s Competition and Market Guarantor Authority (AGCM) launched an investigation into FiberCop to ensure it will not harm competition. It has yet to issue a ruling.

Competition will be key in Italy’s market for the provision of fibre broadband, given that FiberCop is set to become Italy’s de facto high-speed broadband network provider, fulfilling government ambitions to have a single entity controlling the infrastructure and – in theory – speeding up FTTH/B deployment.

That project requires the participation of Open Fiber, the wholesale fibre network operator set up by state-owned firms Enel and Cassa Depositi e Prestiti (CDP). Question marks over the ownership of Open Fiber are in the process of being resolved, with Enel having finally given the go-ahead for the sale its stake in the business to Macquarie. The deal is due to close by the end of June.

It has been a long road to get here, but it’s really starting to look like Italians will have a wholesale network monopoly with myriad retail fibre providers to choose from in the not-too-distant future. That’s the plan, anyway.

  • Cable Next-Gen Europe Digital Symposium


Leave a comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Polls

Which of the following would be the best long-term household broadband solution?

Loading ... Loading ...