Telecom Italia CEO criticises rival for building "fibre to nowhere"

Credit: REUTERS/ALESSANDRO BIANCHI

Telecom Italia's CEO on Thursday criticised smaller broadband rival Open Fiber for being slow to roll out its fast fibre network and of building "fibre to nowhere".

Recasts, adds detail

ROME, Dec 5 (Reuters) - Telecom Italia's TLIT.MI CEO on Thursday criticised smaller broadband rival Open Fiber for being slow to roll out its fast fibre network and of building "fibre to nowhere".

Open Fiber, jointly owned by utility Enel ENEI.MI and state lender CDP, has won all three public tenders to roll out a fast broadband network in so-called non-viable areas in Italy.

Unlike Telecom Italia, Open Fiber is a wholesale-only business, which sells capacity to telecom operators not retail consumers. It is spending billions of euros to build an ultrafast fibre-to-the-home (FTTH) network for consumers and businesses, including in remote areas of the country.

Italy would like Telecom Italia to join forces with Open Fiber to avoid duplicating investments and roll out a future-proof full fibre network.

But a series of problems, including differences of opinion over how much Open Fiber is worth and where funding will come from, have slowed down efforts to tie the knot.

Telecom Italia (TIM) CEO Luigi Gubitosi said public data showed delays in rolling out fibre to so-called economically non-viable areas in Italy had risen despite the use of 1.5 billion euros ($1.65 billion) of public funding.

"What seems to emerge is that in those very areas where everyone has been trying to make up for a delay, the delay in reducing the digital divide has actually increased," Gubitosi, speaking at a conference, said.

Open Fiber was not immediately available for comment.

Gubitosi said a recent parliamentary hearing indicated Open Fiber was laying its fibre an average of 17 metres from homes "creating in this way a new type of undefined architecture which we in TIM jokingly refer to as FTN - Fiber to Nowhere," he said.

Gubitosi acknowledged the creation of a single network was the most efficient way to build a modern broadband infrastructure for the country.

"A tie up between TIM and Open Fiber makes sense and should be pursued, but if this goal is not shared then it will be TIM that takes on this challenge so crucial for the country," he said.

Gubitosi also said international studies had shown that the wholesale-only model - not selling capacity direct to end users - had not proved very efficient in building out a FTTH network.

($1 = 0.9073 euros)

(Reporting by Elvira Pollina, writing by Stephen Jewkes, editing by Giulio Piovaccari and Jane Merriman)

((stephen.jewkes@thomsonreuters.com; +39.0266129695; Reuters Messaging: stephen.jewkes.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Reuters

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

Learn More