Enel to invest €2.5B to bring fibre to 224 Italian cities

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A strategic plan to bring fibre to the homes and businesses of 32 million people across 224 Italian cities has been announced by Italian utility operator Enel.

Through Enel Open Fibre (EOF), a company established by Enel in December last year to build and operate broadband fibre infrastructure across Italy, the plan will be enacted through several phases with an estimated 7.5 million homes reached within the first few years.

The Italian government is a key partner in the utility company, with Italy’s economy ministry owning a stake of around 24 per cent.

The plan will provide investment of about €2.5 billion over its lifetime.

Enel Open Fiber will operate solely within the wholesale market and will be commercially available to build infrastructure for other licensed operators.

In keeping with that strategy, Enel's board of directors have discussed a letter of intent between EOF, Vodafone and Wind, with the purpose of defining a strategic and commercial partnership for the development of the Italian broadband telecommunications network.

According to unnamed sources cited by Bloomberg, the proposals have been met with resistance from Telecom Italia. Media reports said the company is considering cutting nearly 30 per cent of its workforce – up to 15,000 jobs – in response to the increased competition from Enel.

Telecom Italia’s new controlling shareholder, French media company Vivendi, has stressed that it does not intend to cut jobs. However, that move may be unavoidable; sources estimate that the relationship between Telecom Italia and Vodafone Italia and Wind will be heavily impacted by EOF’s broadband plans, leading to a potential loss by Telecom Italia of roughly five million wholesale customers. 

Fibre Systems has previously reported on the state of broadband within Italy (see Italy hopes to invigorate broadband with €6B investment). With the lowest coverage of all 28 EU member states, the country has fallen behind on digital development, especially in terms of the connectivity targets expected by the European Commission in its Digital Agenda for Europe. These latest plans from EOF should significantly improve that situation.

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