Telecom Italia SpA was condemned by a Milan appeals court last month for abusing its dominant position by refusing to provide network connections to virtual private network provider Telsystems SpA. The court said Telecom Italia must pay reparations for the loss of revenue it caused its tiny rival. This marks the first time an Italian […]
Telecom Italia SpA was condemned by a Milan appeals court last month for abusing its dominant position by refusing to provide network connections to virtual private network provider Telsystems SpA. The court said Telecom Italia must pay reparations for the loss of revenue it caused its tiny rival. This marks the first time an Italian company has been condemned in civil court for abuse of its market position. This allows us now to finally trust in the liberalisation scenario, Telsystems president Arturo Artom told Computergram. Telecom Italia issued a vigorous no comment. The decision marks the end of the second of two actions Telsystems had brought against the operator, one administrative, via the Antitrust Authority, and a second civil complaint. The court said the amount of damages will be fixed later by judicial authorities with help from a panel of three industry experts, who have until September 27. Specifically, the court has ordered them to determine the expenses Telsystems had to incur at a pure loss for the lack of being able to start up its proper activity in the first few months of last year and the profit it would have generated as well. Finally, and most controversially, the panel must determine if Telecom Italia’s behaviour caused Telsystems to lose the opportunity to present itself on the market as The first company operating in the Italian voice telephony market for closed user groups under a liberalised regulatory regime. In any case, Artom estimated the total could amount to a few billion lire. The court’s decision came only a couple of weeks after Telecom Italia announced that it had signed a contract to provide a private virtual network aimed at small companies in Florence and Vicenza. The network, which will connect phones, facasimile machines and computers, is a project of the Italian industrial association Confindustria, which decided to find a way to provide telematic services for companies that often find them too complex or expensive. The operator said it should provide them with discounts of up to 30%. Florence and Vicenza follow similar projects in Prato, Pesaro and Urbino, where telephone traffic is heavy and the demand for telematic services is high. In Florence alone, 300 companies signed up for the service, including among them Salvatore Ferragamo SpA, Le Monnier SpA, Nuova Italia SpA and Conte of Florence. Il Sole-24 Ore noted that Telecom Italia responded promptly to Confindustria’s proposal in an effort to counter-attack in this market segment, where it is under attack by Telsystems, and also by major international players like British Telecommunications Plc and France Telecom.