MILAN (WiMAX Day). On Monday, Stefano Parisi, CEO of the Italian alternative telecoms provider Fastweb SpA, indicated that if the company is awarded a license for WiMAX spectrum in June 2007, he foresees investing €300 to €400 million Euros in WiMAX technology over the next three to four years.

Parisi stated during a conference call with analysts that WiMAX would be an important service for Fastweb. The potential WiMAX investment would be based on the likelihood of the Italian Communications Authority (Agcom) requirement that the company provide services to 90% of the Italian population.

WiMAX to enable higher margins
Since 2005, Fastweb has been testing WiMAX in the Valle d’Aosta and Abruzzo regions of Italy using a temporary testing license issued under the guidance of the Ministry for Communications and the Fondazione Ugo Bordoni. From these tests, Fastweb announced that WiMAX proved to be a reliable broadband wireless access (BWA) technology.

Parisi told analysts that Fastweb would focus on launching WiMAX in areas that are not reached by its current ADSL and fibre connections. In these areas, Fastweb buys its broadband capacity from Telecom Italia, giving a very low margin for the subscribers in these areas. Fastweb would replace these wholesale connections with WiMAX and migrate its subscribers to WiMAX in an effort to increase the margins in these areas.

Awaiting licenses
Agcom announced in December 2006 that it would award licenses for WiMAX in June 2007, and Parisi said that for now Fastweb is awaiting conditions for the auction to be set by Agcom. However, Agcom has yet to decide on the format of the auction, let alone what companies will be awarded spectrum, although many believe that Fastweb is among the most likely winners.

At an ITU conference in January, Agcom spokesman Giovanni Santella noted that there are several forms of auction that might be considered, including, Ascending-price, Sealed-bid and Anglo-Dutch, each with its own merits. In the end, a beauty contest auction might be an alternative “hybrid approach” for the auction, where licenses are assigned to those bidders whom the government believe best meet a set of standard requirements.

Agcom also has indicated that it may issue regional licenses instead of national licenses, which encourage small local operators to bid for licenses. This format was used in BWA license auctions last year in France and Germany. Parisi stated that perhaps Fastweb will “have the opportunity” to be a national operator by combined regional licenses. In either case, Parisi added that it is important for Fastweb “to give other services like WiMAX to our customers.”