Riccardo Ruggiero, Executive President of Melita Italy
“The effect of Draghi’s government can attract foreign investment to Italy. In terms of digital innovation, we can move from words to deeds. The city of Milan can aspire to be the first smart city in Italy.”
Twelve months have passed since the beginning of the pandemic and the resulting economic crisis will have serious and lasting consequences for the social and entrepreneurial fabric of Italy.
Today the sectors most affected are those of tourism, entertainment, catering and transport: the sectors dependent on the model of life we had before Covid where there was constant movement.
Industry has also had serious repercussions due to the pandemic; one just needs to take a look at the end of the year results. Many companies have presented results characterised by heavy losses, especially in the automotive and transport sectors.
An important push to restart is certainly represented by the choice of [Mario] Draghi as Prime Minister.
All foreign countries are now looking towards Italy with renewed confidence, their previous doubts concerned the political ability within Italy to use the EU Recovery Fund, while complying with the timeframe and methods required by the European Commission.
We are definitely experiencing the “Draghi effect”.
In the week in which he was appointed, the Italian Stock Exchange rose by 7%. This is because the stock exchanges have bet that government will be better able to manage the €209bn of the Recovery Fund to revive the country. Consequently, it is now also possible to predict an increase in attractiveness for foreign investment in Italy.
To sustain this positive outlook, it is necessary to allocate a series of incentives to help Italian companies to make the technological and digital transformations that are so often talked about, but rarely seen. Investment in the technological transformation of a large company can be essential to increase its competitiveness at an international level, its development and therefore its survival.
With regards to telecommunications, from a certain point of view the sector is experiencing a positive moment; in part as a result of distance learning creating strong demand. The problem for the telecommunications sector is that of commercial distribution. An example would be that the shops that sell products and services are closed in the red areas and are struggling to guarantee the turnover that existed previously.
It is necessary to understand, that for Italy to become a digital country, the first step is to develop its digital infrastructure. It is important to consider that in Italy, due to our geography, it is impossible to think of only using FTTH (Fibre to the home); it is necessary to develop different types of access such as FTTC (fibre to the curb: the fibre optic cable connects to the curb near homes) with mixed copper fibre, FTTC with pure fibre, FWA (fixed wireless access) and, last but not least, satellite internet.
To conclude, it is impossible in Italy to completely bridge the Digital Divide with a single access technology: it will take at least these four or five technologies to reach the goal of ultra-broadband coverage in 85% of the country.
It is also important that the digital network must be accompanied by a transformation of the physical network infrastructure, that is, the network architecture. To give some figures: there are only 628 exchanges at the urban level, 10,500 sub-urban exchanges and about 120,000 distribution cabinets. This whole physical network needs to be transformed.
The city of Milan, which was also one of the most affected by the pandemic, can become the heart of the restart. In fact, Milan can play the trump card of being one of the first cities to become the smart city of Italy and therefore bring a whole range of services – also thanks to the fact that it already has extensive coverage of FTTH and FTTC networks. This can also be achieved through the integration of this network with 5G networks (the high-speed mobile network).
Milan, with all this, could have access to strategic funds but above all could attract foreign capital.