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    HomeFinancial/RegulationItaly's telecoms sector strikes against structural separations

    Italy’s telecoms sector strikes against structural separations

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    Up to 80% of employees are said to have massed in Rome to protest against Wind Tre and TIM being “plundered” like ATMs

    Up to 80% of telecoms workers joined strikes across Italy, protesting against the proposed separation of network, services and customer-facing activities in the country’s telcos, among other things, according to the Italian website, Collectiva. Both Wind Tre and TIM are planning on structural reorganisation along these lines.

    The strikers gathered in the Piazza Santi Apostoli in Rome, where Riccardo Saccone, the National Secretary of the Slc Cgil union said telcos “spend their days…wreaking havoc on rights and wages”.

    He also said, “Once telecommunications were synonymous with modernity, but today the sector has been exploited by finance [firms] which has treated our companies like ATMs, that is, places to plunder.”

    Emporia and inequality

    He argued that separating networks and services will turn the telcos into “mere emporia” and that it would keep Italy in “the status quo of inequality from which it should have emerged with the pandemic crisis”.

    During lockdowns, many thousands of people were unable to work because they lacked ultra-fast broadband (that is, 300+ Mbps) he continued, “Our country can no longer afford this backwardness”, concluded Saccone.

    TIM in turmoil

    It’s hard to remember a time when incumbent TIM wasn’t in turmoil. It is currently looking to secure a buyer for its network. Rival bidders KKR and Macquarie Infrastructure and Real Assets (Europe) in cahoots with state-backed Cassa Depositi e Prestiti (CDP) Equity have until Friday 9 June to submit improved offers – previous ones (of about €21 billion and €19.3 billion respectively most recently) were deemed too low.

    UPDATE: since the story was originally posted, TIM has postponed the date it will make a decision about selling its network to 22 June.

    Macquarie also legally challenged CDP joining forces with the preferred bidder KKR.

    Stormy weather for Wind Tre

    Wind Tre has had a torrid time since Iliad Group’s Free entered the market in 2018, rather than being able to leverage the benefits of becoming Italy’s largest mobile player after the merger of CK Hutchison’s Tre and Wind. CK Hutchison acquired part of Wind from VEON in 2016 and renamed it Wind Tre, before acquiring the entire company in 2018.

    In a bid to improve its fortunes, Wind Tre has also decided to bundle its active network equipment, wholesale mobile business and its fixed communication services together. This new entity is valued at around €3.4 billion. The plan is for the current owner, CK Hutchison to retain a 40% stake and EQT Infrastructure take the rest. Staff have already been on strike, but this is their first outing as part of a sector-wide protest.

    TIM has debts of about €26 billion and Prime Minister Giorgia Meloni’s administration has have the final say on any deal due to its so-called golden power to set conditions or block attempts to take over strategic assets of national importance.

    The grand opera is showing no sign of reaching its grand finale.