The future of the single network is at a crossroads. In her keynote speech to the Chamber, the new Prime Minister, Giorgia Meloni, underlined the need to have “public ownership of the networks, on which companies will be able to offer services under free competition, starting with communications”.
An indication that leaves few alternatives to Telecom’s future: either the single network according to the current scheme will go through (the purchase of Tim’s network by Cdp and the merger with Open Fiber) or it will move to a plan B ( the notorious takeover bid?) to deliver in any case – once the services have been separated and sold, the infrastructure to Cdp. This is also a way to relieve the sector of an important part of investments and try to restart a sector that has suffered not a little in recent years. While worldwide in the first six months of 2022, telecommunications companies see their turnover rise by 3.6%, driven by Chinese companies (+ 10.7%), in Italy the music is much more out of tune.
To take stock of the situation is the annual survey of the major world and Italian groups in the telecommunications sector of the Mediobanca Research Area: Tim, the former monopolist, occupies the 19th position in the world in terms of revenues. In the first six months of this year the revenues of the main Italian operators fell by 4.6% (-3.1% in the mobile sector and -5.8% in the fixed sector). Looking at the operators, Tim lost 7.5%, WindTre 6.1% and Vodafone 2.5%, with a cumulative decrease of € 258m. Iliad continued to grow (+ 15.4% on the first half of 2021), while PosteMobile (+ 3.3%) and Fastweb (+ 1.5%) also rose. But it is in the long term that the sector, in Italy, marks the pace. Between 2010 and 2021, the sector’s turnover decreased by over 14 billion euros with an average annual decline of 3.7%.
The mobile network is the one experiencing the greatest trouble (-5.0%) compared to the fixed one (-2.5%). Revenues from SMS decreased by 2 billion and were practically zero. Those voice, therefore relating to calls, fell by 5.6 billion in fixed and 6.3 billion in mobile. “These dynamics are influenced by competitive pressures” also by the Ott, the giants of the network such as Google, Facebook, Netflix, Amazon, “which in our country caused the most marked decrease in telephone rates (-20.5%) compared to to -4.9% on the European average in the five-year period 2017-2021 », explains the study by Piazzetta Cuccia.
If we then compare the aggregate accounts of the main Italian operators (representing about 95% of the total market) and those of the big world players, “a lower profitability than the former emerges, with a gradual widening of the gap in the five-year period 2017-2021 and a strong acceleration in the 2021 “. For the Italian market, the decline in turnover and the rise in costs led “to a marginality (ebit margin) of 3.3% in 2021 (from 13.5% in 2017), compared to 15.9% of the world‘s big names (14.2% in 2017) ”, Mediobanca analysts point out. Very intense competition and the need for new investments to implement 5G on a large scale and increase the diffusion of fiber push the sector to seize the growth opportunities coming from new technologies such as the cloud and artificial intelligence and from industrial diversification with new services such as energy, digital payments, cybersecurity.
According to the study, in 2021 Tim, as regards Italian activities, is first in terms of turnover (12.5 billion; -3.1% on 2020) ahead of Vodafone (5 billion; -2.5%), Wind Tre ( 4.5 billion; -7.9%) and Fastweb (2.4 billion; + 3.7%), with Iliad in fifth position (0.8 billion; + 18.9%).
“Excluding the start-ups (Iliad and Open Fiber) and the smaller PosteMobile, Eolo and Linkem, in the five-year period 2017-2021 Fastweb is the only one to grow (+ 22.6%)”. Wind Tre is the operator with the highest EBIT margin in 2021 (10.7%), followed by Fastweb (8.9%) and Tim (6.5%), whose profitability has almost halved compared to to 2020 due to the increase in operating costs following the launch of new businesses such as football and the cloud.