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Information Technology in Italy |
by Agnese de Leo & Rosa Gabriele | |
Telecommunications liberalization and deregulationItaly is the fifth largest market in the world for both television and telecommunications services, which are in the process of deregulation. Telecommunications sector accounts for only 1.5% of the country's GDP in comparison to that of US., while the penetration of cable and pay-TV services are relatively low. The telecommunications system, specifically mobile and personal communications, in Italy was liberalized by law that Italian government implemented in 1997 in order to comply with the EC directives. This law formalized the liberalization of the mobile telecoms services by opening the market to new competitors. In 1997 Telecom Italia was privatized and in 1999 Telecom Italia was acquired by Olivetti in hostile takeover bid, Mannesmann became Telecom's Italia main competitor through the acquisition of a majority interest in Infostrada and Omnitel. Telecom Italia maintains monopoly over local telephone calls. Customers can reach competitive suppliers in long distance service only through a four or five digit access code. Also carrier preselection and number portability are not available. The most active competitor of Telecom Italia has been Infostrada (founded by Olivetti and sold to Mannesman following Telecom Italia takeover). More than 50 other operators have been licensed to offer voice services. For example Albacom (backed by BT) focuses on business users while others target residential consumers or small and medium sized companies.Source: Legal Guide to Telecommunications, Jan 1999 Mobile telecommunications In 1999 Italy had 25 million mobile telephone users and a penetration rate of 42%. Telecom Italia (TIM), Omnitel, Wind and Blu are licensed providers of mobile telecommunications services in Italy. TIM launched its highly successful prepaid service in 1996 with no fixed costs and no monthly charge. Currently 75 % of operator's customers use prepaid cards. Telecommunications equipment manufacturing There is no leading national manufacturer in Italy. For example there is Italtel which is going to be split in two separate units with the mobile and transmissions divisions going to Siemens and the switching divisions going to Telecom Italia. Other large manufacturers are Alcatel, Alenia, Ericsson, Marconi and Siemens, as well as network of smaller manufacturers like IPM, Ermet and rapidly growing Telital, which manufactures cellular and digital phones. Pirelli manufactures wavelength division multiplexing equipment and erbium-doped fibre amplifiers. Telespazio, division of Telecom Italia, is one of the biggest companies manufacturing satellite communications in Europe. It is both a service provider and system provider and conducts complete range of satellite management activities from launch vehicle separation to transfer into final orbit. Nokia has opened new R&D centers in Italy. The liberalization effort is still not complete: data traffic remains underdeveloped; Internet usage is well below European average; new infrastructures built to compete with Telecom Italia are still insufficient; and the future of local telecom equipment manufacturers is uncertain.
Market Structure and Regulatory Status |
