(Adds details of govt strategy, background to talks)
MILAN, Oct 16 (Reuters) - Telecom Italia said on Friday it would resume talks with the main shareholders of fibre optic company Metroweb over plans to build a broadband network in Italy.
At stake in the negotiations is who will call the shots to implement the government’s 12-billion-euro project to roll out faster Internet nationwide, a major plank of Prime Minister Matteo Renzi’s reformist agenda.
Metroweb is a small fibre optic company controlled by infrastructure fund F2i and state holding Cassa Depositi e Prestiti through its investment arm Fondo Strategico Italiano (FSI). It has become politically sensitive because Renzi’s government considers it the building block of its broadband plan.
That plan ran into difficulties earlier this year given disagreements over whether Telecom Italia could be allowed to take control of Metroweb.
However, Metroweb’s top two investors recently sent a letter to Telecom Italia, setting no limits to the phone group’s presence in Metroweb, a source close to the matter said last week.
In a statement after a board meeting on Friday, Telecom Italia said it had examined the new proposal received by F2i and FSI, without elaborating on its content. It said the board decided to resume talks with the two Metroweb shareholders “with regards to the possibility of sharing a plan of investments in the FTTH (fibre-to-the home) network”.
Renzi’s government has pledged to invest around 7 billion euros to develop the network, with the remainder coming from the private sector.
However, Telecom Italia is worried that a fast switch to ultra-broadband would render its ageing 15 billion-euro copper network redundant, and wants to make investments only where it is profitable to do so.
Another possible hurdle is that Telecom Italia’s competitors Vodafone and Wind are likely to cry foul at any plan that puts the former monopolist in a dominant position, and this could be blocked by the antitrust watchdog. (Reporting by Silvia Aloisi; Editing by Elaine Hardcastle)