Monday, 15 August 2022

Italian government collapse won’t stop single network plan

by Harry Baldock, Total Telecom
Thursday 04 August 22

TIM CEO, Pietro Labriola, says that talks are continuing between the various stakeholders despite the turmoil within the Italian government

The Italian government has been experiencing massive upheaval in recent weeks, with internal division seeing Prime Minister Mario Draghi offer his resignation on July 14th. While this initial resignation was subsequently rejected by President Sergio Mattarella, Draghi would resign again on one week later, after a new vote of confidence in the Senate failed to pass with an absolute majority.  This leaves the government facing a snap election on September 25th…

The Italian government has been experiencing massive upheaval in recent weeks, with internal division seeing Prime Minister Mario Draghi offer his resignation on July 14th. While this initial resignation was subsequently rejected by President Sergio Mattarella, Draghi would resign again on one week later, after a new vote of confidence in the Senate failed to pass with an absolute majority. 

This leaves the government facing a snap election on September 25th, with analysts suggesting a block of centre-right parties likely to form the new coalition government.   

All of this unrest makes for a complex backdrop for one of Italy’s largest ever telecoms mergers, the combination of incumbent TIM’s fixed line network with that of its rival Open Fiber. 

The plan to create this single national fibre network had been postulated for many years, but opposition from TIM over the terms of the deal had stalled the process for many months. These roadblocks were finally overcome in May this year, with new TIM CEO Pietro Labriola’s plan to separate the company’s enterprise and network units helping to grease the wheels. 

Formal discussions between TIM, Open Fiber, and other stakeholders over the merger are ongoing.

Today, Labriola has reassured the media that planning for the single network is still underway, clarifying that the government’s collapse will not have an adverse effect on process.

"Things are proceeding, the political environment is not blocking the activity," he said on an analyst call earlier today, noting that this view was shared by Cassa Depositi e Prestiti (CDP), the government run state-bank which owns 70% of Open Fiber and is TIM’s second largest shareholder. 

It should come as no surprise that Labriola is looking to steady the ship in the public eye, given that TIM is not without its own internal disruption.

Earlier this month, rumours were circulating that Stefano Siragusa, TIM’s head of network, operations, and wholesale was preparing to step down from his role, having clashed with Labriola over the planned restructure. Today, that news is confirmed, with TIM announcing Siragusa’s departure as well as his replacement, Elisabetta Romano, current CEO of TIM’s subsidiary Sparkle.

“Elisabetta Romano has extensive experience in the Telecommunications and Media sector, gained in particularly challenging environments, both in Italy and abroad,” said a statement from TIM. “At TIM she has held top positions in the technology and innovation sectors. Since August 2020 she has been CEO of Sparkle. Elisabetta Romano becomes a key manager. Stefano Siragusa’s key manager appointment is withdrawn at the same time.”

TIM will surely be hoping that coming months will bring some much needed stability.

 
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