The long march to Fastweb-Vodafone (and what customers should expect)

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We will have to wait more or less a year. The “super Fastweb” – which will have Vodafone Italia with its 15.8 million mobile subscribers and 3.1 million fixed ultra-broadband customers – will see the light in the first quarter of 2025, authorities and various controls permitting. After that date the Vodafone brand will not disappear, but can be used for a maximum of another five years. A long time before the definitive farewell to Italy. In the meantime, companies will continue to move independently. And even followingwards it is difficult to think of immediate shocks to the prices and services offered.

What will arrive on the market will be a stronger operator in landlines than the current Vodafone and more structured in mobile than the current Fastweb. Here the contribution of the Italian subsidiary of Swisscom (3.4 million customers, for a “human” market share of 5%) in numerical terms will be significantly lower than the number of mobile customers that Vodafone will bring.

Strong operator in mobile and first on Ftth

From the users’ point of view, Fastweb-Vodafone will account for a quarter of the total (26%) in human mobile (where machine-to-machine are excluded) with 19.2 million users overall (33 million with m2m cards for industrial uses and home automation). In fixed broadband, where Fastweb (2.6 million users) and Vodafone (3.1 million) total 5.7 million customers, the market share is 31 percent. The operator will however be the first player on Ftth (combined market share 36%, compared to 28% for Tim according to Kearney Italia calculations) with a strong presence in the fixed business segment, which is particularly profitable (1 million fixed lines with a share of 34% % versus 43% for Tim).

Competition with ServCo Tim

«It is an operation that makes a lot of sense, which integrates very similar operators from a positioning point of view, and not a low cost with a premium for example», explains Claudio Campanini, to Kearney Italia who adds: «A competitor is being created that from a profitability point of view it is on par with that of Tim”. The 2.4 billion Ebitdaal once morest the 1.8 of Tim’s ServCo are, moreover, substantially in line by subtracting the 600 million annual run rate synergies expected from the Vodafone-Fastweb union, which evidently cannot be achieved immediately all together. In fact, with all these premises “the most complete competitor of the former incumbent is created, capable of having an important market share in all market segments”.

Head to head with Tim and Wind Tre in mobile human

Certainly too close to Tim and Wind Tre in terms of market shares in the mobile sector to be able to afford to raise prices with the risk of market share. In this context, the market immediately, from the first indiscretions, discounted the fact that the one between Vodafone and Fastweb would have represented a much less convenient marriage than that between Vodafone itself and Iliad which in January had presented an offer for a joint venture, but returned to the sender. A riskier operation from the point of view of the necessary regulatory authorizations and with a less preferable outcome, with the risk of remaining in a joint venture “highly indebted in Italy”, commented Vodafone Group CEO, Margherita Della Valle.