Italy delays €1.6bn rural broadband award to OpEn Fiber

Italy delays €1.6bn rural broadband award to OpEn Fiber

Italy is looking again at OpEn Fiber's tenders to the government to build ultra-fast broadband in five poorly served regions of the country.

But Infratel, the government body due to make the award, is taking a second look at the bids and has delayed its decision, according to people familiar with the project, speaking to Capacity.

Rumours in the Italian telecoms industry say that OpEn Fiber, which was founded by electricity company Enel and merged with Metroweb in December 2016, won all tenders for the projects, expected to serve 6.5 million people at a cost of €1.6 billion.

“But there were anomalies in the offer from a sustainability point of view and because of economic matters,” one observer, an executive in the industry, told Capacity. “Infratel is going to make a final decision in the coming weeks. Everyone has to be sure of the sustainability.”

Meanwhile TIM – the consumer brand adopted by Telecom Italia – said that it was speeding up its own coverage of ultra-broadband in the so-called market failure areas.

The company acknowledged that “at present better offers than its own are thought to have been received” by the Infratel commission.

It added that “this tender competition concerned the creation of a public network with public investments in ‘market failure’ areas, such as rural or sparsely populated areas”, and pointed out that these are “areas in which TIM owns a network and where in any case the company will intervene selectively with its own fixed and mobile ultra-broadband coverage, offering its customers maximum quality in the shortest time possible”.

TIM added: “The results of the tender competition do not have any impact from an operational or strategic perspective or on the market positioning of the company which confirms its targets and will speed up its investment plan to cover the entire country in a very short time.”

According to Italian sources, rival bids for the market failure areas came from energy company Estra; a consortium of telecoms carrier Retelit along with Eolo and EDS Infrastrutture; TIM; and OpEn Fiber, which completed its €714 million acquisition of the entire share capital of Metroweb in December 2016.

Neither the Italian Ministry of Economic Development nor OpEn Fiber have commented on the delay.

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