Telecom Italia, Fastweb eye 5G cost savings with Italy’s network deal, sources say

By Elvira Pollina

MILAN, Jan 6 (Reuters) – Telecom Italia (TIM) and Swisscom’s Italian unit Fastweb are nearing a mobile network-sharing deal to cut costs of upgrading and operating their 5G infrastructure across Italy, three sources said.

Italian telecom firms are revamping their business model after losing nearly a third of revenue since 2010 and seeing post-investment cash flow drop to zero from 10.5 billion ($12 billion) that year, industry group Asstel said.

The deal would help TIM and Fastweb upgrade to standalone 5G — a technology built from scratch rather than on 4G — as the sector remains squeezed by fierce price competition.

Thanks to the deal, TIM and Fastweb could each save as much as 250 million to 300 million euros over 10 years, according to one of the sources with knowledge of the matter.

The project, internally codenamed Prism and not reported previously, covers active network components such as antennas, base stations, radio units, backhaul and other equipment that transmit and manage mobile signals. 

It targets towns with fewer than 35,000 residents, the people said, declining to be named as plans are not public.

Parties aim to finalise the agreement by early March, two of the sources said.

Representatives for TIM and Fastweb declined to comment.

NETWORK UPGRADE

Fastweb last year became Italy’s top mobile operator after an 8 billion euro buyout of Vodafone’s local business.

The network accord with TIM would revive an earlier active network sharing plan that TIM and Vodafone agreed but never implemented after merging their passive mobile infrastructure into tower company INWIT in 2019.

The deal would make each operator responsible for upgrading the technology in designated areas to avoid a duplication of investments and managing costs, the people said, adding it is expected to include spectrum sharing.

TIM and Fastweb plan a joint venture that won’t share assets or supplier contracts for now, with each managing costs on a shared grid of 15,500 sites by end-2028, the sources said.

Italy’s mobile market, with 100GB plans under 10 euros, ranks among Europe’s cheapest, limiting returns, JP Morgan said in its 2026 outlook.

Asstel is lobbying to renew spectrum licenses after operators spent 6.5 billion euros in a fierce 2018 auction.

($1 = 0.8554 euros)

(Reporting by Elvira Pollina; Editing by Valentina Za)