5G regulation and law in Italy

1. What is the state of 5G deployment in your country?

5G is already deployed in Italy’s main cities, especially in the north, but barely so in the countryside. Five communications operators are offering 5G services: TIM, Vodafone, WindTre, Iliad and Fastweb.

As of 31 December 2020:

  1. TIM has confirmed that its 5G services are active in Rome, Milan, Turin, Florence, Naples, Ferrara, Bologna, Genoa, Sanremo, Brescia and Monza (with the first racetrack in Europe to be connected with 5G). The next cities to be covered will be Verona, Matera and Bari. According to TIM, by the end of 2021, 120 cities, 200 tourist venues, 245 industrial districts and 200 specific projects will see services implemented;
  2. Vodafone has activated 5G in Rome, Milan, Bologna, Turin and Naples and many areas of the areas around Milan. It also announced that its 5G now covered more than 90% of Milan’s population.
  3. WindTre announced that it had activated 5G services in Ancona, Arezzo, Avellino, Bolzano, Brescia, Campobasso, Catania, Florence, Foggia, Genoa, Palermo, Perugia, Pesaro Urbino, Potenza, Ravenna, Sassari, Savona, Turin, Trapani, Trento, Treviso, Verona, Vicenza and 15 other cities. It aims to cover 70 areas by the end of 2021.
  4. Iliad’s 5G services are available in some areas of the following cities: Alessandria, Bari, Bologna, Brescia, Cagliari, Como, Ferrara, Firenze, Genova, La Spezia, Latina, Messina, Milano, Modena, Padova, Perugia, Pesaro, Pescara, Piacenza, Prato, Ravenna, Reggio Calabria, Reggio Emilia, Roma, Torino, Verona e Vicenza. It has meanwhile said it is working to increase 5G coverage.
  5. Fastweb provides 5G through a network sharing agreement with WindTre. The services are already available in certain areas of Milan, Bologna, Rome, and Naples, as the operator progressively increases its coverage.

2. Are telecoms companies monetising 5G investments - or are the services provided to consumers at similar prices to 4G? 

Most operators have defined new 5G offers with fixed monthly fees that are different to the ones applied to 4G services. Some include special additional features, such as a music streaming service (TIM) and a few free months of a cinema streaming service (Vodafone). In most cases, users must pay an activation fee.

3. Has 5G been launched for industrial purposes? For which sectors?

According to a recent study by the 5G & Beyond Observatory of the School of Management at the Politecnico of Milan, 122 5G projects are in the trial phase, some via public grants.

The projects relate to:

  1. remote monitoring (35% of the projects) in smart cities (mobility management systems, smart parking, intelligent lighting and intelligent bins for waste collection), agriculture (managing crops and receiving alerts), health sector (telemedicine tools to maintain patients’ vital signs), and transport (facilitating predictive maintenance across large distributed infrastructures such as railways, monitoring with sensors and drones);
  2. improving user experience (20%) with applications for tourism, media and education;
  3. security and video-surveillance (16%), connected cars (9%), improvements in connectivity (2%), and autonomous driving (2%).

4. What is being done to ensure that a wide range of operators and industrial companies, from small to large, have access to frequencies?

The 5G auction took place in 2018.

The tender’s rules aimed to ensure broad access to spectrum:

  1. the frequencies were divided into blocks, with capping mechanisms to limit the spectrum each operator could obtain;
  2. some blocks were reserved for new entrants, and went to Iliad, which entered the Italian mobile market in 2018;
  3. licensees had certain obligations to grant other companies access to their 5G network.    

5. What public tenders have awarded spectrum licences? 

The public tender began in mid-September and ended on 2 October 2018, with the awarding decision published seven days later.

The Ministry of Economic Development (MISE) assigned rights to use frequencies in the following bands: 700 (694-790) MHz, 3700 (3600-3800) MHz and 26 (26.5-27.5) GHz. The winning operators were: Telecom Italia, Vodafone Italia, Iliad, Wind Tre and Fastweb.

The frequencies were made available from 1 January 2019 for the 3700 MHz and 26 GHz, while the 700 MHz frequency will become available on 1 July 2022. The usage rights will terminate on 31 December 2037. 

5.1 What were the criteria for awarding each of the tenders?

Participants provided a technical report indicating the services and technology they intended to implement, which had to be consistent with the tender conditions and licensee obligations.

Each frequency block had a reserve price, in order to achieve the minimum target set by the budget law (EUR 2.5bn). The blocks were awarded to the highest bidders after 14 days of competitive bidding.

5.2 What are the conditions of the spectrum licence? 

The main obligations are: (a) spectrum usage; (b) coverage; and (c) access .

Participants accepted an obligation to use the awarded frequencies in the 700 MHz SDL, 3600-3800 MHz and 26 GHz bands within strict timelines: 24 months from receiving the right of use, or from the nominal availability of the frequencies, if later, in the 3600-3800 MHz, 36 months in the 700MHz SDL band, and within 48 months in the 26 GHz band. Within these timelines, they must install the broadband or ultra-wide radio network and use the assigned frequencies, in all provinces.

5.3 What is the price and how is it calculated?

The 700 MHz spectrum raised EUR 2.04bn. Telecom Italia paid EUR 680.2m for 2×10 MHz. Illiad spent EUR 676.5m for 2×10 MHz. Vodafone spent EUR 683.2m for 2×10 MHz.

The 3600-3800 MHz frequencies raised EUR 4.3bn, with an average price for the frequencies of 18 cEUR/MHz/PoP/10 years.

The price for the 26 GHz frequencies was much lower, raising a total of EUR 167.3m.

According to a recent study conducted by Bank of Italy researchers (“Connected Italy”, by Emanuela Ciapanna and Giacomo Roma, downloadable at https://www.bancaditalia.it/pubblicazioni/qef/2020-0573/QEF_573_20.pdf), after adjusting the data to the population (and therefore to the different market sizes), the unit price per MHz recorded in Italy was twice that of Germany, three times that of the UK, and four times more than Spain.

6. Is there a long-term spectrum plan or announcements for future tenders? 

There has not been an announcement on future tenders.

7. If 5G specific rules are drafted, what do they say?

The 5G-specific rules are set out in the AGCOM (Italian Communication Authority) Resolution 231/18/CONS and the MISE tender rules. AGCOM is likely to approve further regulations in future, for example in connection with net neutrality requirements.  

8. What focused 5G network or spectrum sharing regulation exists?

To guarantee broad territorial 5G coverage, the tender rules ask licensees to cooperate. In fact, the 700Mhz spectrum holders are jointly bound to reach 99.4% of the national population, within 54 months of receipt and on terms agreed among the assignees. Within 14 months of receipt, they must jointly agree tools to verify implementation. They must submit their plan to the Ministry of Economic Development and AGCOM, and then update it annually. Failure to do so could result in their losing spectrum rights, with no reimbursement. The tender rules identify certain extra-urban areas in which each assignee must provide roaming services, frequency pooling, technical characteristics and locations to the others based on reciprocity principles, in order to guarantee a seamless service. These areas include crucial national networks for road, rail and maritime transport.

9. Are 5G network sharing or spectrum sharing agreements in place? 

There are two main network sharing agreements:

TIM/Vodafone

TIM and Vodafone’s agreement is via the integration of their respective tower companies, INWIT and Vodafone Towers. The two towercos have been integrated into INWIT, which will rent space mainly to telecommunication operators. INWIT is now jointly controlled by TIM and Vodafone, which each own a 37.5% share. To secure the European Commission's approval (announced 6 March 2020), the operators offered the following commitments:

  • INWIT will make available, on reasonable and non-discriminatory terms and in accordance with a specific timetable, free space on 4,000 towers in municipalities with more than 35,000 inhabitants, for third parties to install, operate, maintain and use equipment to provide current and future fixed wireless and mobile telecommunications services;
  • INWIT will publicise which towers are available;
  • INWIT will respond in a timely fashion to third party requests for tower access, and may only refuse to provide space for technical reasons, explaining any reasons in writing;
  • In the event of access disputes, a fast-track resolution mechanism will be put in place so an independent expert can adjudicate; and
  • INWIT, TIM and Vodafone will not exercise any early termination rights on existing hosting contracts and framework agreements, and will offer to extend these.

The Commission concluded that the transaction, as modified by the commitments, would no longer raise competition concerns. The decision was conditional upon full compliance with the commitments.

Fastweb and WindTre

Fastweb and WindTre announced an agreement on 25 June 2019 to deploy a shared 5G radio access and backhaul network to support the delivery of next-generation, high performing mobile services for their customers. The shared network includes their macro and small cells, connected via Fastweb’s dark fibre, with a view to covering 90% of the population by 2026. WindTre manages the 5G network, while both operators remain independent in the commercial and operational use of the shared infrastructure. As part of the agreement, WindTre provides Fastweb with roaming services on WindTre’s existing network, thus allowing Fastweb to extend its mobile coverage. Meanwhile Fastweb provides Wind wholesale access to Fastweb’s FTTH and FTTC network, improving WindTre’s ultra-broadband connectivity to wireline customers.

10. What are or will be the rules for granting competitors access to new 5G networks once they are deployed?

Access obligations vary depending on the frequency band an operator has been awarded:

700 MHz FDD

Operators with spectrum in the 700 MHz FDD band must offer national roaming on their 700, 800 and 900 MHz networks to a new entrant acquiring spectrum in this band for 30 months nationally and 60 months in the areas not covered by the new entrant. The roaming conditions must be fair, non-discriminatory, and transparent. The new entrant has the right to national roaming only if it has launched commercial service and covered at least 10% of the population with its own frequencies.

3600-3.800 MHz

Each winner of at least 80 MHz nationally in the 3600-3800 MHz band (or that reach this amount by adding up frequencies in the lower 3400-3.600 MHz to which they have any right or agreement to use) must provide access to other players not licensed in the bands up to 3800 MHz (or licensees in 3.5 GHz but with frequencies covering less than 40% of the national population), such as other TLC operators or service providers. Access must be provided on the following terms: (a) access aim to develop 5G services and be based on commercial agreement with fair and non-discriminatory conditions; (b) the agreement specifies the area of interest (which does not necessarily include areas where the holder has coverage obligations or in general intends to cover); and (c) if the licensee does not cover the area where a player needs connectivity, the player can deploy the network, upon agreement or by leasing frequencies. This obligation also aims to develop new business cases by exploiting high performance technologies to offer future innovative services.

26 GHz

Access obligations according to the “Club use” model: each licensee can dynamically use all the awarded spectrum (up to 1 GHz) in areas where frequencies are not used by other licensees. To this end, licensees can stipulate commercial reasonable and non-discriminatory agreements, proportionally sharing the costs. Each licence holder has the pre-emptive right to its assigned block (or blocks). Licensees can assign to a trusted third party the task of managing the uses to avoid harmful interference as well as the access scheduling. Moreover, licensees must provide access (wholesale capacity) to other players (non-telco providers) to develop 5G services. There are additional specific access obligations for services in closed areas with public attendance such as ports, airports, stadiums, arenas, cinemas, theatres, national parks, museums and metros.

11. What comments have been made regarding 5G cyber-security and possible use of Chinese technology, including regulation?

To ensure 5G cybersecurity, the government has included 5G technology within the scope of application of its ‘Golden Power’ regime (Law Decree n.21/2012), recently integrated and amended with Law Decree n.105 of 21 September 2019 (“Law Decree 105/2019). The scope of Golden Power application also relates to agreements with non-EU entities on:

  1. the purchase of goods and services relating to the design, implementation, maintenance, and operation of 5G networks; and/or
  2. the acquisition of related high-tech components.

The law imposes a notification obligation for certain transactions, and the government may use the Golden Power by either imposing mitigation measures or vetoing the relevant transaction if mitigation would not limit risks to the integrity and security of networks and data. According to the statutory law, when a Golden Power notification is filed, the National Office for Assessment and Certification (Centro di valutazione e certificazione nazionale – CVCN) will assess possible vulnerability factors that could compromise the integrity and security of 5G networks and data transmitted through a preliminary investigation, which becomes part of the procedure.

Moreover, the EU NIS Directive, implemented in Italy through Legislative Decree no. 65 of 18 May 2018 and supplemented by the Law Decree 21/2012, has created a perimeter of national cyber security affecting public administrations as well as public and private national operators which:

  1. exercise an essential function of the state, or ensure the provision of an essential service for the maintenance of social, civil, and economic activities that are fundamental for the interest of the state, and
  2. provide these functions or services through critical systems such as information systems and services whose malfunctioning, interruption or improper use could affect national security.

The law identifies a series of requirements and notification duties that operators must meet. These include an obligation to: (i) notify to the Presidency of the Council of Ministers and to the Minister of Economic Development, and subsequently update, a list of critical systems used by the operator; (ii) notify any incident having an impact on such critical systems to Italy’s Critical Security Incident Response Team (CSIRT); and (iii) comply with measures to guarantee a high standard of security for critical systems.

The decree also affects suppliers of goods, ICT systems and services to be used on critical systems by requiring operators planning to purchase such goods and services to notify the CVCN. Furthermore, the new legislation introduces a duty of collaboration with the CVCN, which may ask suppliers to meet certain conditions or request hardware and software testing for any risk assessment at their own expense. In this case, any supplier contract must include a condition precedent or a termination clause contingent upon the outcome of any CVCN assessment.

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