Dark territory

23 June 2017 By Neil Unmack Follow @unmack1

Ministers are threatening to punish Telecom Italia for building broadband in poor areas. The snag is that it is competing with government-linked rival Enel. Telecom Italia’s French ownership also adds complexity. Whatever the motive, attacking private investment is a risky move.

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Two Italian government ministers have threatened to impose damages on Telecom Italia if it builds a broadband network in areas where a government-linked rival is operating.

Telecom Italia has said it will build a “fibre to the cabinet” network that includes some rural or sparely populated areas officially deemed unable to attract private investment. The Italian government last year awarded the first of several contracts to subsidise the development of broadband in regions including Emilia Romagna, Lombardy, Molise and Umbria to Enel Open Fiber, jointly owned by government-owned utility Enel and Cassa Depositi e Prestiti, the state bank.

The Ministry for Economic Development said in a June 19 statement that the government would “act to protect the public interest” if Telecom Italia were to follow through on its investment plan, disclosed on December 23.

Claudio de Vincenti, minister for territorial cohesion and the south, said in an interview with the Corriere della Sera on June 17 that the government would be forced to value the “validity and scale of damages” invested in competition with Enel.

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