Italy stumbles once more on 5G funding

Italy stumbles once more on 5G funding, The Italian government has launched a contest for more than €500 million in funding to provide 5G connection to places where there is now no high-speed mobile coverage.

That appears to be a great step until you realise that this tender is essentially a re-issue after a prior attempt to award cash for 5G in trouble areas failed to generate any interest. The state has altered the parameters this time, cutting the total amount available to €567 million from the €974 million it attempted to distribute in March and reducing the number of places to be covered.

So, for Italy’s telcos, it’s back to the calculators to check if the numbers add up this time.

This project, which aims to extend 5G networks to areas where they would be uneconomic to cover otherwise, is part of Italy’s much-discussed post-Covid National Recovery and Resilience Plan, or PNRR in Italian. The PNRR has access to €191.5 billion in EU funds, as well as tens of billions in additional funding from the Italian government, but the telecoms sector will only absorb a small amount of it.

Overall, Italy plans to spend €6.7 billion on broadband infrastructure, including fixed networks, satellite, and 5G, with the Italy 1 Giga project accounting for more than half of that total. The project was launched in January, just days after the country failed to attract any interest in a much smaller tender for connectivity in its minor islands. We questioned if the tender terms are conducive to attracting telecoms at the time, and it looks that there are still issues on that front.

Italy stumbles once more on 5G funding, The 5G effort in Italy, which accounts for a significant portion of the country’s overall broadband infrastructure spending, is divided into two parts: one for mobile network infrastructure and the other for base stations. The plan is – or was – worth approximately €2 billion in total. According to Italian financial daily Il Sole 24 Ore, the Ministry for Technological Innovation and Digital Transition (MITD), led by minister Vittorio Colao, received bids for all available lots in the fibre section but none at all in the mobile network portion by the 9 May deadline.

After conducting financial modelling, the telecoms decided against participating in the tender, according to the report. It would have been “extremely difficult” to serve mostly rural sections of the country while still generating enough money and profits to balance expenses and meet the duty to open up the infrastructure on a wholesale basis, according to the report.

It’s unclear whether any requirements have changed as a result of the re-issue of the tender – it must, after all, conform with EU standards – but the state has clearly maintained the 90 percent restriction, which means that the money can cover up to 90% of the operators’ total expenditures. The tender’s scope, however, has changed. Although there are still six regional lots, each one now covers less areas.

Telecommunications companies have until June 10 to submit their applications. We’ll find out whether any of them choose to do so later that month. Italy stumbles once more on 5G funding

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