TIM holds government talks over fixed line network

By:
James Pearce
Published on:

Telecom Italia chairman Arnaud de Puyfontaine told La Repubblica that the Italian firm is in talks with the government over a "shared strategy" for its fixed line business

Telecom Italia (TIM) has said it is in talks with the Italian government about developing a “shared solution” for its fixed line network, according to reports.

Arnaud de Puyfontaine, chairman of TIM, reportedly told La Repubblica that a separation of the network could make sense in order to develop a neutral platform for all companies and reduce the digital gap in Italy.

(CEO Amos) Genish and I are working on this front with pragmatism. We understand the national interest, we will examine the dossier with the government: the important issue is to meet the interest of all stakeholders," he said.

TIM, which has been under pressure over the power wielded by shareholder Vivendi, has previously denied reports that it would sell its fixed copper network, despite government minister Pier Carlo Padoan claiming such a deal would benefit Italy.

De Puyfontaine claimed it was “premature” to discuss shareholders joining ownership of its backbone network, which is worth an estimated €15 billion according to reports.

Telecom Italia’s international wholesale division, Sparkle, has also been linked with a sale. Sparkle is seen as a key consideration by the government as it has investigated Vivendi’s increasing control in the Italian incumbent. Italian regulators have been investigating whether there was an effective change of ownership when Vivendi increased its stake to 24%, something the French media company has denied.

Italian regulators are looking into whether Vivendi breach strict ownership rules, as TIM owns significant national interests including Sparkle’s subsea cables.

This led to Italy invoking special powers on TIM called “Golden Power” rule that means TIM, Sparkle and Telsy will ensure that certain security functions are assigned to "a member of the board of directors … who is an Italian citizen, who has security clearance, and is approved by the government for the role". Some of the rules "have already been implemented by the company", said TIM in a statement.