Government officials in Italy appear to be in agreement that the third cellular operator’s license will be awarded before May. At a Milan conference last week, Italian telecoms minister Antonio Maccanico said the reasonable time frame for awarding the third cellular operator’s license is likely to be at the end of March or the beginning of April, later than previously stated. The following day, at the Italian Telecom User (ANUIT) conference in Rome, under secretary of telecoms Michele Lauria said the rules for the competition would be set before the end of February, and the operator picked between March and April. The government insists it will keep to the calendar, despite having missed its self-imposed deadline to appoint an independent expert to evaluate the candidates’ business plans, said a report late last week in Il Sole-24 Ore. Only Price Waterhouse had remained in the running, with others, like Baring, J.P. Morgan, Societe Generale and Rothschild withdrawing because the conditions set out by the ministry were too byzantine, the paper said. In parallel, the eight members of the Telecom/TV Authority are set to be elected on February 12. Lauria also allowed that the ministry is leaning toward abolishing the 1 trillion lire per year concessionaire’s fee that Telecom Italia pays the government. Telecom Italia has been clamoring to have removed for years, saying it would allow them to reduce interconnect fees. Lauria said, however, that the issue of interconnect fees is separate from that of TI’s fee. He also defended the government’s decision to allow TIM and Omnitel to experiment with using DCS 1800 frequencies in two cities. In the meantime, the candidates chafe at the wait. Ricardo Ruggiero, CEO for Infostrada, said that, with every month lost, his company loses tens of billions of lira in revenue. Wind said it has committed to spend trillion lira for its new mobile infrastructure from Ericsson and Italtel-Siemens. Not to be outdone, Picienne Italia announced that it would spend 8 trillion lira on its network, and that Lit. 200 billion would be spent immediately to set up a test-bed network in a couple of cities, using a provisorial license granted by the government. PCN Italia also committed to covering the entire Italian territory with an exclusively DCS 1800 network. Wind has apparently already asked the government to allow it to cover non-urban areas with GSM frequencies. PCN Italia has based its investment decisions on predictions that the Italian market will boast 26 million users in 2005, jumping to 40 million five years later. The company says it expects to break even in 2001, making a profit the following year. PCN Italia’s operational management will be centered on Mediaset, BT and Telenor, while INA and Italgas will contribute their sites for installation of the network nodes. BNL, meanwhile, will coordinate and participate directly in the project’s financing. Of the 8 trillion lira, said Piol, 1.5 trillion lira will come from the shareholder capital, 2 trillion lira from external financing and 4.5 trillion lira will be self- financed
