Looking forward to the second half of the year, the regulated mobile termination rates further reduced in July 2012 from €6.3 cents to €3.5 cents for incoming calls and from €5.3 cents to €2.5 cents for outgoing calls. Consequently, 3 Italy is expected to benefit from a lower cost base, which will enhance its customer services margin.
Between December 2011 and June 2012, 3 Italy posted revenues of €920 million, up 6 percent against €870 million.
3 Italy had blended ARPU (f0r 12 months) of €19.02, while the non-voice ARPU was €7.95.
Media reports say the deal will assist Telecom Italia to strengthen its weakening mobile business in Italy and possibly bolster the group’s weak overall financial performance, according to analysts.
Moody’s Investors Service recently downgraded the company’s rating to just one notch above junk, warning that further downgrades are possible.
The possible merger would aggregate two of the current four main mobile operators in Italy, with the others being Wind and Vodafone Italy.
According to Italian regulator Agcom, Telecom Italia’s market share of the mobile business stood at almost 35 percent in the third quarter last year, while H3G’s Italian business held 10.4 percent market share.
Earlier this year, Telecom Italia posted a 5.8 percent decline in 2012 revenue for its domestic mobile business compared with a year earlier, which stood at 6.6 billion euros ($8.5 billion) against €7.1 billion in 2011.
Telecom Italia’s net debt stood at €28.27 billion at the end of 2012, down from €30.41 billion a year earlier, but above its year-end target of €27.5 billion.
