Grillo returns to comedy and attacks Open Fiber

Beppe Grillo returns to comedy, as in the past. The comedian and historical father of the Five Star Movement (M5S) launched into one of his tirades and targeted, with a straight leg intervention published on his blog, the managing director of Open Fiber (OF) Elisabetta Ripa . The manager has to go home, claims the pentastellato comedian, because she is not up to her job.

Perhaps Beppe Grillo has some institutional role that could remotely justify such a radical stance towards the CEO of a company that operates on the market and whose shareholders are, 50% each, Cassa Depositi e Prestiti (Cdp) and the 'Is in the? Absolutely not. So does he have a political role that can validate the position he has taken? Rhetorical question: the M5S is in constant search of a leader who does not exist. He himself took the step back, giving up a position in the foreground.

So? Grillo's edict therefore seems to be interpreted as the umpteenth boutade in the great spectacle of grillina politics. Were it not for the fact that it touches a strategic sector for Italy, that of the digitization of the country which OF is carrying out by laying optical fiber where no one else had gone to put it, the matter would end here. Instead, the comedian-politician wanted to give indications to the government on how it should proceed in the delicate match over the single network: once the CEO is replaced, the government should increase CDP's stake in Tim, convince Videndi's Frenchmen to leave and downsize Enel to the role of simple shareholder who invests but does not affect. Naturally, there is no mention of the fact that Enel is a listed company, just as Tim is, as well as WindTre, Vodafone, Sky Italia operating on a market in strong competition, all of which turned to OF for the fiber network.

Here is the Radiocor agency which reported Beppe Grillo's attack:

(Il Sole 24 Ore Radiocor Plus) - Rome, June 22 - "Immediately change the managing director of Open Fiber" who "is not up to par", "allow Cdp to enter Tim with a further figure of the capital that must be equal to that of Bollore'” and, “from the position of strength of CDP to propose to the French to sell”. These are the proposals of Beppe Grillo, on his blog, to proceed with the creation of a single fiber optic network in Italy. In this way, says Grillo, “we would have Tim's majority to start the creation of a single company integrated mobile network, 5G, ultra-broadband. Avoiding that two subjects with state shareholdings (namely Tim and Open Fiber, both of which have Cdp as a shareholder) go to war with each other". For this project, continues Grillo, "is the CEO of Cdp Fabrizio Palermo ready to explain the details?". Upstream of these conclusions, Grillo underlines "the complete failure of the Open Fiber operation, the company that was supposed to push the digitization and development of fiber throughout Italy". Enel, a 50% shareholder of Open Fiber, "unfortunately is not compatible with this project, because it claims to administer Open Fiber, acting as a 'father master' and not simply as a shareholder".

A few hours after Grillo's speech, Open Fiber's response arrived: “Beppe Grillo wrote, hoping for the birth of a single national network, that we would be facing the 'complete failure of the Open Fiber experiment. It seems clear to us that he was misinformed,” the company said in a statement. After listing the important partnerships entered into in recent years, OF asks a question: “If it really were 'bankruptcy', why this evident interest from companies (TIM) and large infrastructure funds to invest in the project or to acquire it at a high price? Perhaps because instead in less than three years it has covered a third of the country, becoming the third fiber optic network in Europe after Telefonica and Orange (the first managed by a wholesale-only operator) with 8,6 million property units already wired and a plan of resources to bring it, with this step, to over 20 million homes in three years. Over 10 people are working on a project today”, continues Open Fiber.

The company then goes on to respond point by point to the accusations of the former leader of the 5 Star Movement:

On the merits, Grillo's writing shows that he was given false information (fake news) at least on the following points:

– Open Fiber does not compete with "all traditional operators", but only with TIM. Instead, all the other operators have benefited from the increased competition in the market: in recent months they have in fact repeatedly expressed positive opinions on Open Fiber and have announced that they will oppose a return to a vertically integrated monopoly with all the tools at their disposal.

– Public money is paid to OF only in progress, and therefore for the infrastructure actually built and for which OF also invests its own resources.

– OF won all the public tenders because its project was judged the best, has a higher fiber share and uses less public money than the rejected projects.

– The only existing duplications were made by TIM with the Cassiopea project, for which it was also fined 116 million by the Antitrust on March 6, 2020. Not to mention that, looking at the extension of the FTTH network, of motorway at the moment there is only one, that of Open Fiber.

– There are development delays in white areas, lacking connectivity due to decades of underinvestment. It's true, delays partly deriving from the legal war launched by TIM on the project and from a bureaucracy that blocks any initiative in the area. But at the end of 2022, 92% of the real estate units envisaged by the BUL grand plan will be connected, with a queue in 2023 for 8% of the remaining real estate units. In this way Italy will see the construction - in about 4 years from the start of construction sites in areas C and D (mid-2018) - a new national and public fiber optic network. 

– TIM shares are not worth 0,7 euro per share today, but around 0,38 euro as we write this note. Is a company that, as shown by its balance sheets, burdened by heavy debt able to make the investments that the country needs?

– Grillo now hopes for a single private infrastructure open to all, which under the control of TIM brings together the mobile network, 5G, ultra-broadband. A monopoly so vast that no legislator or authority could authorize (not counting the legitimate interests of those who invest time and huge resources in the business) but which above all would place the destiny of the web in the hands of those who for decades have not invested adequately in modern infrastructures, generating the divide that we would instead like to fill.

The note concludes by noting the strategic nature of the project carried out by Open Fiber, too important and "complex to be fed with fake news".

The stock exchange result of the question and answer does not seem to reward Grillo's action: Tim - 0,7% to 37,7 cents around 16.42 (the detachment weighs in), when the Ftse Mib loses 0,91% (- 0,6% after removing the coupon effect). The exit of the Genoese comedian took place shortly before Luigi Gubitosi, CEO of Tim and vice president of Confindustria with responsibility for digital, spoke at the Anitec-Assinform meeting. An intervention, that of Gubitosi, entirely focused on the need to accelerate the digitization of the country as a stimulus to economic recovery and innovation after the Covid-19 emergency.

"The health emergency - said Tim's CEO - has made us notice even more some historical criticalities", among them the digital divide that has divided the country stands out "between those who have access to the network and those who do not, in particular in the white areas". Gubitosi defined the development of ultra-broadband, fiber and 5G networks as "essential". Of the ultra-broadband network, the manager highlighted, "we tested the value during the crisis, we imagine how it would have been without a functioning network, and we think of those who were unable to take advantage of these levers" due to the digital divide. For Gubitosi "the Iot, the cloud, artificial intelligence are the new tools for innovating the country's productive fabric". No reference to the theme of the single network.

(Last aupdate at 16.45 on 22 June)