November 8, 2018 / 4:43 PM / 5 days ago

UPDATE 1-Telecom Italia and Open Fiber in talks to use each other's networks -sources

(Adds details, context)

ROME, Nov 8 (Reuters) - Telecom Italia and broadband rival Open Fiber, partly owned by utility Enel , are in talks to use each other’s fibre-optic networks, two sources close to the matter said on Thursday.

The government enlisted the help of Enel two years ago to build a fibre-to-the-home (FTTH) network after accusing Telecom Italia (TIM) of acting too slowly to upgrade its ageing copper network.

With TIM expanding its own network, industry experts have warned that duplication of infrastructure makes little economic sense.

“They are working on commercial agreements that do not, however, envisage a merger or integration of the networks,” one of the sources said of the TIM talks with Open Fiber.

Under the agreement being discussed, TIM would give Open Fiber access to its network in mainly urban areas, while TIM would have access to its rival’s infrastructure in areas where it is not present, the sources said.

Italy’s new populist government, meanwhile, is looking at the idea of creating a single infrastructure company to launch a wholesale ultrafast broadband network to rent to telecoms operators.

The Italian government, which is joint owner of Open Fiber through state lender CDP, also owns a stake of more than 4 percent in TIM.

TIM Chief Executive Amos Genish said in June that he was open to discuss combining the Italian phone group’s FTTH assets with those of smaller rival Open Fiber.

Enel CEO Francesco Starace has previously said he is ready to cooperate with TIM at a commercial level but is not interested in any merger.

TIM’s board meets on Thursday to discuss nine-month results.

Reporting by Alberto Sisto Writing by Agnieszka Flak Editing by David Goodman

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