Italy’s €3.4 billion EU-funded ultra-fast broadband rollout, a cornerstone of its post-COVID recovery strategy, is facing serious delays as state-backed telecom players Open Fiber and FiberCop struggle to align on a collaborative deal.
The impasse threatens not only the 2026 deadline but also strategic ambitions to unify the country’s broadband infrastructure under a state-controlled wholesale network, Reuters news report said.
The Italian broadband market, a key segment of the telecom services sector, is projected to generate US$51.25 billion in revenue in 2025 and grow to US$68.09 billion by 2030. The market is moderately fragmented, with major players including TIM, Vodafone, Wind Tre, Cellnex, and Fastweb. Growth is driven by rising demand for high-speed and bundled services, along with the expansion of 5G and fiber-optic networks, enhancing digital connectivity across the country.
Strategic Ambition Meets Operational Gridlock
The Italian government’s long-term strategy centers on creating a unified, state-led wholesale broadband provider by merging the assets of Open Fiber and FiberCop. The goal: improve efficiency, accelerate nationwide high-speed internet coverage, and reduce Italy’s digital divide. However, this vision is being tested by operational friction between the two companies.
FiberCop, backed by KKR and partly owned by Italy’s economy ministry, has outpaced rival Open Fiber in deployment, completing a greater share of its cabling obligations. With Open Fiber lagging, Rome is now considering reallocating some of its 2.2 million assigned buildings to FiberCop in order to meet the EU-mandated deadline of June 2026. But proposed takeover terms — offered at cost by FiberCop — have sparked resistance.
Investment and Valuation Disputes
At the core of the dispute is the complexity of spinning off Open Fiber’s network areas. Open Fiber, majority-owned by state lender CDP and Macquarie, argues that any carve-out and asset valuation will take months, not weeks, delaying the handover and complicating integration. This standoff reflects deeper tensions in managing overlapping state and private investments, especially when timelines are tight and pressure from Brussels looms.
FiberCop, which was spun off from Telecom Italia and sold in a €22 billion deal, sees itself as better positioned to accelerate deployment — but faces resistance without clear asset transfer terms. Open Fiber’s board is expected to deliberate on this, but sources suggest a swift agreement is unlikely.
Challenges Ahead
The Italian government is racing against the clock. As of the latest data, only half of the targeted 3.4 million buildings have been connected. With just over a year remaining and only 60 percent of Italian households having access to ultra-fast broadband (vs. the EU average of 79 percent), failure to accelerate progress could jeopardize not only EU funding but Italy’s competitiveness in the digital economy.
A senior official from Prime Minister Giorgia Meloni’s office emphasized that the government won’t dictate terms but expects the companies to resolve the deadlock quickly. Without compromise, Italy risks falling further behind its European peers in broadband infrastructure — despite significant strategic intent and capital investment.
TelecomLead.com News Desk
