Italy's competitive mobile market pressures telecom margins
TIM provided enhanced 5G coverage at Milano Cortina Olympics venues
Consolidation seen as key for efficient pricing in telecom sector
By Elvira Pollina
MILAN, Feb 25 (Reuters) - Telecom Italia TLIT.MI is exploring the introduction of premium-priced on-demand mobile services for customers seeking guaranteed fast and stable connectivity during large gatherings such as major sports events, its boss said on Wednesday.
Italy remains one of Europe's most competitive mobile markets, with some operators offering 100-gigabyte monthly plans for under 10 euros ($11.78).
The prolonged price war has eroded margins across the telecoms sector, prompting carriers to consider new revenue models.
CEO Pietro Labriola said during a post-results call with analysts that volumes cannot be relied upon to drive growth in a market like Italy, arguing that operators need alternative ways to monetise network investments.
'MISSION-CRITICAL'
TIM provided enhanced fifth-generation mobile coverage across multiple venues during the Milano Cortina Winter Olympics, including the opening ceremony at Milan's San Siro stadium.
Labriola said more than 60,000 attendees and all the athletes parading at the Olympics opening ceremony were able to share videos and photos in real time thanks to reinforced infrastructure deployed specifically for the event.
"For the moment, we are offering this service for free, but we are thinking about charging a premium for it if our customers decide to use it," Labriola said.
"If you go to the stadium, you pay more for a coffee and for food — why shouldn't this happen for ultra-fast connectivity, which is mission-critical for our personal life?"
The TIM CEO has not disclosed potential pricing levels, or a timeline for introducing premium connectivity tiers.
CONSOLIDATION KEY TO EFFICIENCY, CEO SAYS
Labriola reiterated that consolidation in the Italian and European telecoms sector is in his view key to ensuring an efficient pricing environment, particularly in the consumer retail market.
"If there is no consolidation in Italy, we have to be transparent — life for the company's consumer segment will be tougher," he said.
Reuters reported that rival telecoms operators Iliad and Wind Tre are in talks over a possible tie-up in Italy, a scenario that would reduce the number of Italian mobile network operators from four to three.
($1 = 0.8486 euros)
(Reporting by Elvira Pollina; Editing by Jan Harvey)
((elvira.pollina@thomsonreuters.com;))