Telecom Italia, Fastweb team up for 5G rollout in Italy

By Elvira Pollina

MILAN, Jan 7 (Reuters) - Telecom Italia (TIM) on Wednesday said it had agreed to a preliminary deal with Swisscom's Italian unit Fastweb to share mobile networks and speed up the rollout of 5G technology across the country.

Under the agreement, first reported by Reuters on Tuesday, each company would be able to use the other's mobile radio access infrastructure in some areas, which would reduce costs and avoid infrastructure duplication.

TIM and Fastweb could each save as much as 250 million to 300 million euros ($292 million to $351 million) over 10 years, a person with knowledge of the matter previously told Reuters.

"The efficiencies generated will make it possible to extend high-performance 5G network coverage to underserved low-density areas," TIM said.

Italy's hyper-competitive telecoms market has eroded nearly a third of its companies' revenue since 2010 and driven their post-investment cash flow to zero from 10.5 billion euros, according to industry group Asstel.

The project will target towns with fewer than 35,000 residents, sources told Reuters on Tuesday, covering active network components like antennas, base stations, radio units, backhaul and other equipment. 

TIM said a final contract was expected to be signed in the second quarter, adding that the collaboration "ensures that both companies will maintain full commercial autonomy and technological independence."

TIM and Fastweb won't share assets or supplier contracts for now, the sources previously said, adding that they would each cover half of Italy's 20 regions.

Fastweb last year became Italy's top mobile operator after an 8 billion euro buyout of Vodafone's local business.

($1 = 0.8549 euros)

(Reporting by Elvira Pollina and Giulia Segreti; Writing by Valentina Za; Editing by Alvise Armellini and Thomas Derpinghaus)