The Wholesale-Only model in Italy: from niche to national players - Sipotra

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The Wholesale-Only model in Italy: from niche to national players - Sipotra
The Wholesale-Only model in Italy: from
                                    niche to national players
          Which ultra-broadband network for a 5G economy and society? The wholesale-only FTTH business case
2017 All rights Luigi  Gambardella
                reserved             Head of European Affairs Open Fiber| | Valencia, FTTH Annual  Conference
                                                                                             Nome presentazione    13/02/2018
                                                                                                                | Data | Altre indicazioni eventuali
The Wholesale-Only model in Italy: from niche to national players - Sipotra
2

                                OPEN FIBER’S
                                  MISSION
                           Open Fiber brings ultra-broadband
                           fibre optics (HSBB) to the entire
                           Italian territory, in the form of Fiber to
                           the Home (FTTH) technology. This
                           provides the country with more
                           Internet speed and enables people
                           and companies to access highly
                           advanced digital services, giving
                           everyone the chance to take
                           advantage of the opportunities of an
                           increasingly interconnected world.

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The Wholesale-Only model in Italy: from niche to national players - Sipotra
ABOUT                                                                                      3

                                                                 OPEN FIBER
                 Non-vertically integrated operator with a “Wholesale only” business model. Our aim is to be a key player in the
                                                            digitalisation of the country.

FOUNDATIONS Solid shareholders                                      Market leadership                          Innovation for a Gigabit society
              Enel S.p.A. and CDP Equity            The acquisition and incorporation of Metroweb represents    The objective is to become a “national
           (CDPE), a company of the Gruppo           a competitive advantage, due to the company’s specific     champion”, thanks to the development
           Cassa Depositi e Prestiti group, are      industry skills and know-how, acquired over 10 years of       of a “future-proof” network in the
            equal shareholders (50%-50%) of            experience in the TLC infrastructure sector and the      principal Italian cities and participation
                  Open Fiber’s capital.                  development of an FTTH fibre optic networks.                   in Cluster C&D tenders.

                                             Innovative business                 Industrial partnerships with key
   TOOLS                                           model                            players in the TLC chain

 OBJECTIVES                                       Ultra-broadband connectivity throughout Italy

                                         Implement the installation, supply and management of a high-speed, fibre
                                           optic, electronic communication network across the national territory.

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The Wholesale-Only model in Italy: from niche to national players - Sipotra
WHAT DOES OPEN FIBER DO?                                                                                      4

                          BUILD A FUTURE-PROOF INFRASTRUCTURE

  High quality and efficient                     Promote                           Separation of the                                     Strong
       infrastructure                           competitors                      Network and Services                                  employment
                                                                                                                                         driver
        Realisation of a FTTH               One of the key factors in all        Open Fiber is an integrated, non-              Open Fiber’s activities have a
   infrastructure to guarantee the       modern Systems and Networks                vertical operator that works              positive effect on both direct and
highest performance. Furthermore,         (electricity, transport, etc.), and   exclusively in the so-called “whole-              indirect job creation. It is
 fibres have a longer life-time and    something that is also hoped for by         sale only” market. It provides              estimated that once completed
       are less prone to service       many Authorities, is to support the            access to fair and non-                  the Open Fiber plan will create
interruptions and technical issues,    liberalisation process of the sector       discriminatory conditions for all                  approx. 15,000 jobs.
reducing both problems for clients            and protect competition           interested operators and does not
       and maintenance costs.                                                   compete to gain the custom of the
                                                                                              end user.

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The Wholesale-Only model in Italy: from niche to national players - Sipotra
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                                 FIBRE OPTIC
                                 BROADBAND
                             Just like water, gas and electricity,
                             having an Internet connection has
                           become a fundamental resource, and
                            a fibre optic network represents the
                            pinnacle in terms of technology and
                                        performance.

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The Wholesale-Only model in Italy: from niche to national players - Sipotra
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                                                                            BROADBAND STRATEGY
 DIGITAL                                                                                   GOALS
                                                                                                                                                                      DIGITAL
 AGENDA                                                                                   2020                                                                       AGENDA

 ITALY                                                                                                                                              EUROPE

        Primary areas*                                                                                                                                    Primary areas*
        100 Mbps                                                     85%                                        50%                                   100 Mbps
                                                                 of the population                          of the population

        Remote areas                                                                 The Italian strategy                                               Remote areas
                                                                                     exceeds the goals
        30 Mbps                                                      15%             established by the         50%                                      30 Mbps
                                                                 of the population   Digital Agenda for     of the population
                                                                                      Europe (DAE) for
*of economic interests with a higher demographic concentration
                                                                                             2020
(industrial areas, schools, Public Administration, hospitals).

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The Wholesale-Only model in Italy: from niche to national players - Sipotra
“FUTURE-PROOF” CONNECTIVITY                                                                         7

                                          FIBER TO THE HOME (FTTH)

COPPER   FIBRE    EXCHANGE             CABINET            HOME                 MAX MBIT/S                     THE ADVANTAGES OF
                                                                                                               FTTH TECHNOLOGY
                                                                                  up to

ADSL                                                                             20
                                                                                                           The FTTH technology used by Open
                                                                                                        Fiber guarantees a speed of over 1 Gbps,
                                                                                                           because the entire line is fed by fibre
                                                                                                                      optic cables.

                                                                                  Up tp

FTTC                                                                            200                           FTTH technology supports the
                                                                                                          potential of the new technologies that
                                                                                                          will be arriving in the next few years.

                                                                                  over

FTTH                                                                           1,000
                                                                                 (1 Gbit/s)
                                                                                                        FTTH technology is an important factor in
                                                                                                         the digital transformation of the country
                                                                                                         (e.g. e-Government, Smart City, Smart
                                                                                                           Working, Cloud computing, 5G, IoT,
                                                                                                                      Industry 4.0, etc.)

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A POSITIVE IMPACT ON COUNTRY-WIDE SYSTEM                                                     8

                                      ULTRA-BROADBAND
U LT R A - B R O A D B A N D                                                            GDP

                                             Various accredited studies
                                          demonstrate a direct relationship
                                          between the growth of broadband
                                               and the growth of PIL.               +1.3

                                                                                    +1.4
      +10%                                    DIRECT RELATIONSHIP

                                                                                    +1.5

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                                   THE OPEN
                                  FIBER PLAN
                            Open Fiber’s industrial plan for grey,
                            black and white spot areas, aims at
                              filling Italy’s competitive gap and
                               satisfy the needs of the Gigabit
                                  society, in line with the most
                           progressive laws of the policy makers.
                            The objective is to reach approx. 20
                                     million Property Units.

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THE OPEN FIBER PLAN                                                                                    10

                                                                          CLUSTERS A&B
                        Thanks to the acquisition of Metroweb and the construction works in course, Open Fiber already has the largest Fiber to
                                                     Home (FTTH) network in Italy (2,4 million Property Units - PU*)

                                                                           3.9 billion euro **
                         2016                                2017 (first half)                       2017 (second half)                                     2018/2022

                 Pilot project                          A network in expansion                          Reinforcement                                       A new era
      Completion of works in Perugia.                      Completion of works in Milan,       Implementation activities are foreseen in          We expect to complete activities
       In collaboration with Vodafone,                   Turin and Bologna. At the end of           another 81 municipalities. The               in 271 municipalities, for a total of
        Wind and other operators, we                    last year works started in Catania,   commercialisation of the service is already          9.5 million connected property
      have already reached our target                      Venice, Cagliari, Padua, Bari,     underway through principal TLC operators.                          units
        coverage for the city (approx.                    Palermo, Naples, Florence and       We expect to start collaborations with 32 of
            65,000 property units)                       Genoa, with cabling of more than                these companies.
                                                              280,000 property units

                                                                                                    2,4 million PU
*of which 1.3 million PU in Milan, Turin and Bologna;
** 90% by 2022
                                                             2 million PU                                                                            9.5 million PU
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THE OPEN FIBER PLAN                                                                                        11

                                                         CLUSTERS C&D
                           The first two Infratel tenders involve the connection of 9.3 million property units.
       Open Fiber has secured a grant for five lots of the first Infratel Tender (for a total of approx. 4.6 million property units) and six
                               lots of the second tender (for a total of approx. 4.7 million property units).

TENDER INVESTMENTS                          FIRST TENDER                            SECOND TENDER                                COVERAGE

 Approx.   2.65
     Billion euro*
                                                   5                                        6
                                                  lots                                      lots

                                            4.6 million                              4,7 million
                                                   PU                                       PU

                                                                                                                                           *Source Infratel Tenders

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THE OPEN FIBER PLAN                                                                          12

                                                       CLUSTERS C&D

   3,043                        6 regions              1.4 billion           6.4 million            4.6 million                  4-5,000 jobs
municipalities            Abruzzo, Molise, Emilia   the total value of the   citizens involved     homes, schools,             are estimated to be
                          Romagna, Lombardia,        works tendered by                              hospitals and               created during the
  involved
                            Toscana e Veneto               Infratel                              companies reached by         implementation of the
                                                                                                     broadband                         plan.
                                    FIRST TENDER

                                                            5
                                                           lots

                                                             4.6 million
                                                             PU                                     FIGURES FOR THE
                                                                                FIRST TENDER
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THE OPEN FIBER PLAN                                                                               13

                                                             CLUSTERS C&D

     3,710                       10 regions                  1.2 billion             6.8 million               4,7 million
  municipalities           Piemonte, Valle D’Aosta,       the total value of the    citizens involved   homes, schools, hospitals and
                          Liguria, Friuli V.G., Umbria,    works tendered by                               companies reached by
    involved
                          Marche, Lazio, Campania,               Infratel                                        broadband
                               Basilicata, Sicilia
                            and Provincia di Trento                                                          SECOND TENDER

                                                                                                6
                                                                                               lots

                                                                                   4,7 million
FIGURES FOR THE                                                                                 PU

SECOND TENDER
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14

                                CONTACT US

                             Luigi.gambardella@openfiber.it

                                   +32 497 57 65 57

                           Open Fiber, Avenue des Nerviens 9-
                                   31 – 1040 Brussels

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