What is the new strategy about? On 3 March 2015, the Italian Government approved a plan to invest EUR 6 billion to encourage electronic communications providers to boost high-speed networks within Italy. The plan, dubbed the “Italian Strategy for Ultra-Broadband Networks” (“Plan”), is premised on the theory that telecoms networks are necessary and critical infrastructure that support the economic and social development of countries. The Plan, which focuses on fixed ultra-broadband networks, also recognizes that the performance of mobile networks will be increasingly affected by the underlying infrastructure. Therefore, through the Plan, Italy aims to establish a “future-proof” telecoms infrastructure, based on the principle that “it is not worth building a freeway with two lanes, if before completing them it is already evident that four lanes will be needed” (Section 2.2, page 38 of the Plan). This entails the development of ultra-broadband networks across the whole Italian territory and the achievement, by 2020, of the objectives set forth in the Digital Agenda for Europe, which include the deployment of 100 Megabits per second ("Mbps") connectivity services in Italy’s most densely populated areas, and at least 30 Mbps connectivity services for other areas. In order to achieve such goal, the Italian Government intends to (i) reduce cost barriers and administrative burdens; (ii) establish an ad hoc cadaster for ‘above and below the ground’ infrastructure; (iii) align with other EU Member States in terms of the thresholds for electromagnetic emissions; (iv) allow tax incentives, credit financing at reduced rates, and investment grants; and (v) provide directly for the construction of public infrastructure in market failure areas. How will the Plan work? In order to maximize public participation, especially in light of the available resources, the Plan breaks down the Italian territory into "four clusters" based on population density and the specific characteristics of each territory. Such "clusterization" provides the opportunity to target public intervention based on the type of 2 territory and on the specific objectives established for the corresponding area. The clusters have been identified as follows: (i) Cluster A includes 15 of the largest Italian cities, where telecoms providers are more likely to invest; (ii) Cluster B includes "grey areas" where market conditions are not sufficient in and of themselves to drive private investments; (iii) Cluster C includes market failure areas where telecoms providers may be interested in investing only with State aid; and (iv) Cluster D includes typical market failure areas where only public intervention can guarantee the provision of 30 Mbps connectivity services. The Plan describes in detail the four intervention models, which have been structured on the basis of the specific cluster. The first model provides for a public tender to award the permit to carry out the works for the deployment of the access network to the bidder that submits the best offer. This model has been specifically designed to address the characteristics of Cluster D. The access network resulting from the awarded works would be State-owned, but licensed to a telecoms provider to be selected via a public tender. The second model would be based on a public-private partnership, where private co-investors will have the possibility of exploiting the access network. The third model is based on public contribution, which must be allocated to a telecoms provider through a public tender. Finally, the fourth model, when necessary to maximize 100 Mbps coverage, gives the opportunity to combine the three above-mentioned models, by aggregating connectivity demand. The control over the management of the above-mentioned tenders will be ensured by Infratel Italia S.p.A. (an in-house company of the Ministry of Economic Development), while the Italian Communications Regulatory Authority (Autorità per le Garanzie nelle Comunicazioni – “AGCOM”) will supervise the services performed and the technological choices made. Which technologies will be involved? The Plan is neutral with respect to the technologies used to achieve the set objectives. However, it recognizes that certain technologies may have features which have to be taken into account to achieve the Plan’s goals. For instance, according to the Plan, while in theory Long Term Evolution mobile technology (“LTE”) could offer a transmission speed of 75 Mbps upstream and 300 Mbps downstream, the coverage plan of LTE radio stations might not reach 30 Mbps for all users. This notwithstanding, LTE will play a very important role in achieving the coverage of 30 Mbps in low-density areas. With reference to Fixed Wireless Access technology (“FWA”), this would be essential in providing at least 30 Mbps connectivity to peripheral areas through point-to-multipoint connections. FWA could also play an instrumental role in achieving the 100 Mbps coverage goal, when provided through point-to-point connections. 3 Also satellite will be a critical technology in such scenario because of the suitability of satellites for providing connectivity in territories subject to extreme geographical conditions (e.g., islands or mountains with low population density), which are typical in a significant portion of the Italian soil. According to the Plan, satellite has to be viewed as a valuable resource for 30 Mbps coverage. Given that this technology is characterized by significant costs for the operators, public subsidies could be granted for satellite services providers. As to fiber networks, they are commonly considered as the strategic solution enabling 100 Mbps connectivity, because of their capability to reach the user at the nearest available point. However, fiber networks - whether provided as Fiber to the Home (“FTTH”), Fiber to the Building (“FTTB”), Fiber to the distribution point (“FTTdp”) or Fiber to the Cabinet (“FTTC”) - do require considerable investments, mainly due to the civil works which are necessary for their installation and roll-out. Yet, several telecoms providers in Italy have already developed their own fiber access infrastructures in order to provide ultra-broadband services. Therefore, the investments necessary for the deployment of a widespread fiber infrastructure need to follow a balanced strategy in order to adapt to the infrastructural intervention, taking into account the market potential. And now, what? Through the ultra-broadband strategy, Italy aims to further accelerate the development of ultra-broadband networks in view of the European objectives set forth in the EU Digital Agenda. These governmental efforts are crucial not only to comply with the EU goals and deadlines, but also to boost the Italian economy by leveraging the potential of the Internet. Indeed, we live in an era where the Internet is increasingly perceived to be an essential facility, and where its role in our society, economy and financial systems is becoming more and more central. Accordingly, deploying an efficient, resilient, secure and widespread next-generation network for ultra-broadband services is one of the key factors to unleash all the potential of the Internet and to effectively manage the growing demand for stable and fast connectivity. This Strategy for Ultra-Broadband Networks is a milestone towards this new technological environment.