Benefits of the wholesale only model for fibre deployment in Italy

Ilsa Godlovitch, Julian Knips and Christian Wernick

in Study Series from WIK Wissenschaftliches Institut für Infrastruktur und Kommunikationsdienste GmbH

Abstract: The wholesale only business model, in which fiber connections are only marketed at the wholesale level and not directly to end customers, is widespread in many European countries and is structurally different from vertically integrated models. In Italy, the wholesale only provider Open Fiber is the main driver of fiber network expansion with over 9.5 million connected premises, including over three million households in rural areas. On behalf of Open Fiber, WIK has examined this business model more closely in a dedicated report. The increased penetration of fiber connections in Italy not only helps to spread smart city applications, but also offers potential for saving greenhouse gases compared to copper-based connections. From an investor's point of view, infrastructure investment in wholesale only networks is attractive because they provide relatively stable long-term returns. These networks offer potential advantages for wholesale customers, as the risk of discrimination is smaller in comparison to vertically integrated wholesale supplier. Finally, retail customers benefit from the choice between different ISPs.

Date: 2020
Note: Study for Open Fiber
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:wikstu:251542

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