February 17, 2022
Having overbid for 5G spectrum a few years ago, Italian operators are apparently panicking now that the payments to the government are due.
This is according to Reuters, which got hold of a letter from Italian telecoms lobby group Assotelecomunicazioni (abbreviated, remarkably, to Asstel) to the Italian government. It pleaded with the state to allow a delay of payments, said to be in excess of €4 billion, that are due on winning auction bids later this year.
Asstel itself doesn’t seem to have published anything, preferring instead to leak the letter to Reuters for some reason. Maybe that’s because its head, Massimo Sarmi, seems to have embarked on a rather undignified whinge about how tough times are for Italian telcos, citing exceptional circumstances such as competition. He also made the entirely redundant point that if they hand over this cash to the government, they won’t be able to spend it on other stuff.
It’s hard to know what to make of this. Italian operators clearly overpaid for mid-band spectrum back in 2018 but nobody had a gun to their heads. It’s not difficult to design the auction process to maximise bids and we find it easy to imagine the Italian state did just that. But those operators have had almost four years to come to terms with their over-exuberance and plan around it.
This is starting to feel a bit like the situation in India, in which Vodafone Idea had to settle for a 2008-style government bailout in return for handing a chunk of the company over. What would the Italian operators do if their government tried the same move in response to this letter? However this plays out, hopefully they have at least learned to stay off the Grappa next time a spectrum auction kicks off.
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