Italian Prime Minister Matteo Renzi has begun an ambitious plan to bring super-fast broadband to 85 per cent of Italy’s consumers by 2020. Fixed broadband take-up in Italy is 23 per cent compared to an EU average of 31 per cent. The percentage of customers with fixed broadband download speeds greater than 30Mbit/s is just 2 per cent – significantly below the EU average of 23 per cent57. Mr. Renzi sees Metroweb, which generates sales of just USD 74 million, as a good vehicle to achieve his ambitious plans.Metroweb is an example of an SPV in which ownership of the network is split between the public and private sectors. It was conceived as a result of Telecom Italia’s perceived lack of investment in fibre infrastructure. It is an arrangement between a gas and electricity utility company, A2A, and e.Biscom, a new telecommunication service provider, to accelerate the roll-out of a large fibre-optic network in the major metro areas.Metroweb currently owns a 3 200-km fibre network extending throughout much of northern Italy, including the municipality of Milan, as well as Turin and Bologna58. It is a passive infrastructure operator and leases point-to-point, dark-fibre service to its customers, including its separate retail affiliate, Fastweb. Metroweb also serves Telecom Italia, Wind, Vodafone and other service providers in Milan. Funded by a EUR 100 million loan from two Italian banks, Metroweb has planned to expand to two additional metro areas chosen from a shortlist that includes Florence, Parma, Verona, Brescia and Monza59.Although Metroweb is central to the government’s broadband aspirations, it has not garnered any state-aid approved funding. However, local municipalities (such as the one in Bologna) have played a key role in creating favourable conditions to attract investment in Metroweb by:• creating a register of all current network infrastructure in the City; and • speeding up the process of getting the necessary planning permits to carry out civil work.An Italian infrastructure fund known as F2i acquired a 53.8 per cent stake in Metroweb in 2011, expecting a growing demand for high-capacity broadband and services. Several years later, however, it began looking to divest all or part of its holding. Consequently, Telecom Italia and Vodafone became interested in acquiring a controlling stake in Metroweb, which was valued at approximately EUR 400 million60. 1.3.5 Public DBOs The public DBO investment model is an extension of the public outsourcing model. It requires the greatest level of involvement and financial contribution from the government and minimizes private-sector involvement and investment. This model often is used to intervene when it is not possible to attract any investment interest from the private sector. The government typically funds the entire network construction and the infrastructure remains government-owned.Public DBO projects work in much the same way as public outsourcing. A private-sector contractor is awarded a contract to design and build the network infrastructure on behalf of the government. However, the government creates a separate, publicly owned company, which then manages and operates the broadband network. The main difference from the public outsourcing model lies in the public-sector operation of the network, rather than its construction. The publicly owned company takes full responsibility for making the wholesale open-access network available to other service providers on a competitive and open-access basis.In the public DBO model, then, the government is fully responsible for financing the broadband infrastructure and therefore takes on much of the financial risk – and the operational risks. In return, the government retains greater control over the design of the network and the technical and service-performance criteria. Having ownership control may allow the government to re-use assets from SOCs, providing they are fit for purpose. It should be noted that the publicly owned company has to meet the performance milestones itself, a job left to the private sector operator under the private DBO model.16 Trends in Telecommunication Reform 2016