Telecom Italia: The Parallel Returns (1997–2006)

in Italian Politics
Author: Massimo Florio
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During 2006, Telecom Italia—the most important of Italy’s entirely privatized

companies and one of the largest in the country in terms of market

capitalization, profit, employment, and technological wealth—ran into

political controversy. On 11 September, CEO Marco Tronchetti Provera

presented the company’s board with a strategic plan that, breaking with

the course followed the previous year, foresaw the unbundling of three

divisions: Telecom Italia (TI, landline telephone services, Internet, and

media operations), Telecom Italia Mobile (TIM, mobile telephone services),

and Telecom Italia Rete (the network operator). In the days following

the announcement, the government claimed that it had been kept

in the dark about the proposal despite a series of meetings with the TI

board. The press nevertheless revealed that one of Romano Prodi’s advisers

had sent Tronchetti an alternative plan that would have allowed the

purchase of the landline network by the Cassa Depositi e Prestiti (Deposit

and Loans Fund), a holding group controlled by the Ministry of Finance.

Prodi denied any knowledge of this plan in Parliament (his adviser subsequently

resigned).

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