Fastweb CEO backs TIM's last-mile network project
MILAN (Reuters) - Fastweb, the Italian phone business of Swisscom, on Thursday said Telecom Italia's (TIM) last-mile network project was "sound" and would ensure an upgrade of the copper and fibre grid that connects homes to street cabinets.
Fastweb plans to invest in the last-mile network project - known as FiberCop - that TIM has been looking to develop with U.S. infrastructure fund KKR. But the plan has been complicated by government pressure for a single, nationwide broadband network that would include the last-mile grid.
Italy wants TIM and Open Fiber, a wholesale-only broadband business owned by state-owned utility Enel and state lender CDP, to team up to create a single broadband network for the country.
Fastweb CEO Alberto Calcagno said in a note KKR's interest in TIM's last-mile network proved "this is a sound project that takes us on a one-way path towards the definitive upgrade of the copper network."
Under the FiberCop plan, TIM would be the main investor in the last-mile grid, but this is opposed by Enel which wants a wholesale-only model for the single broadband network.
Calcagno said concerns over TIM's control of the last-mile network company were misplaced and it was misleading to contrast the vertically-integrated model TIM advocated with a wholesale-only one.
He said if the FiberCop plan succeeded, a separate company not directly involved in selling services to final users and open to outside investment would manage network development and the sale of wholesale services, ensuring there was no discrimination.
Italy has told TIM to negotiate a deal with Open Fiber on the single broadband network, forcing the Italian telecoms group to postpone finalising a decision on the sale of a minority stake to KKR.
On Wednesday, Beppe Grillo, founder of Italy's senior coalition party the 5-Star Movement, called on Rome to ensure state lender CDP is the main shareholder in the single broadband infrastructure.
(Reporting by Valentina Za. Editing by Jane Merriman)