Italy could opt for fibre optic grid operator-Agcom

ROME, July 7 (Reuters) - Italy should set up a company to handle the move to a fibre optic network which would be supported with private and public funds, the head of the telecoms authority said on Tuesday.

Corrado Calabro, chairman of the authority, said the proposed company should be modelled on the way existing utilities operate networks and the authority could set tariffs adequate for investment needs.

Former monopoly Telecom Italia (TLIT.MI) is investing in the move to fibre optic from copper wire based on demand and clients' willingness to pay for it. [ID:nL81003404]

"The practical route seems to be a company formed around a strong nucleus of industrial partners with a mix of business expertise to develop the fibre optic project," Calabro told the lower house of Italy's parliament.

"We will evaluate with the operators (rules) which while guaranteeing competition would most encourage and adequately compensate investments in fibre optic," he added.

Some lawmakers have proposed splitting off Telecom Italia's fixed-line network to spur Italy's broadband ambitions, an option that Telecom Italia is resisting.

A report by a government adviser has suggested one option could be creating an integrated fibre-optic and copper national network for broadband coverage of 50 percent of households. [ID:nLJ962181]

The report said this would involve investment of 10 billion euros over five years. Creating a fibre-optic network to cover 25 percent of households could involve 5.4 billion euros of investment over four years.

(Reporting by Alberto Sisto, writing by Jo Winterbottom)