Italy plans to issue a tender for a third mobile phone operator this fall, announced the government, which recently passed a bill establishing the guidelines for the tender.
A license is expected to be issued by the end of the year to a company or consortium in which members are from Italy or other European Union nations, reported an Italian news agency.
Sources weren’t available to comment on the amount a third operator will pay for its license, nor at which frequency-900 MHz cellular or 1800 MHz personal communications-the network will operate.
Two Global System for Mobile communications cellular operators service Italy today, Telecom Italia Mobile SpA and Omnitel Pronto Italia.
Telecom Italia is owned by the government. Omnitel is an international consortium lead by Italian computer giant Olivetti, with partners Bell Atlantic Corp., AirTouch Communications Inc., Cellular Communications International, Telia of Sweden, Lehman Brothers, Mannesmann AG of Germany, the Bank of Rome and other smaller Italian companies.
If Omnitel’s success is any indication, Italy’s mobile phone market is growing quickly.
Omnitel started GSM service last December. By March, AirTouch, which owns 11.7 percent of the operation, reported Omnitel served 100,000 GSM customers. In July Omnitel reported 300,000 subscribers.
Also this summer Omnitel contracted for Globalstar satellite services to be provided by Elsag Baily.
The operator plans to use the satellite coverage to deliver mobile phone service in areas its GSM network does not reach.
Omnitel has roaming agreements in Europe and a few months ago announced plans to activate roaming agreements with eight GSM operators serving South Africa and Australia.
From network launch, Omnitel was required by the Italian government to provide service covering 70 percent of the country’s 58.2 million population.
TIM, a spinoff of Telecom Italia, launched a GSM system in April of last year despite protests from Omnitel that it would give TIM an unfair market advantage.
Further, Omnitel was required to pay $450 million for its license.
The European Commission demanded Italy level the playing field with Telecom Italia, which did not pay for its GSM license.
As a compromise, Omnitel and Telecom Italia agreed Omnitel would receive in 1996 a 25 percent discount on charges for phone line interconnection and an additional 25 percent reduced rate in 1997.
TIM operates an analog network as well.
At the end of last year, TIM claimed a total of 3 million cellular customers, 330,000 of which were GSM subscribers.
Reuters reported that a partnership of British Telecommunications plc, an Italian bank and Mediaset, the recently floated television and advertising arm of Finivest SpA, plans to bid for the third license.
State owned power company, Enel, was expected to submit a bid for the license as well.
