What’s up with… Intel, Telefónica, Telecom Italia

• Broadcom and TSMC eye up Intel assets
• Telefónica’s LatAm upheaval continues 
• Telecom Italia gets new investor, launches energy service

In today’s industry news roundup: Intel could be broken up if either Broadcom or TSMC make successful bids for the chip giant’s units; Telefónica has placed its operation in Peru under bankruptcy protection; Telecom Italia has a new investor in the form of Italy’s national postal service; and much more!

Intel is coming under increasing M&A scrutiny as it grapples with its turnaround plans under its recently appointed co-CEOs Michelle Johnston Holthaus and David Zinsner, both of whom took the helm late last year. Last September, Qualcomm was cited as a potential bidder for part (or parts) of the beleaguered chip giant and now, according to The Wall Street Journal, Broadcom and Taiwan Semiconductor Manufacturing Company (TSMC) are believed to be exploring possible bids for certain Intel divisions. Broadcom is said to be interested in Intel’s chip-design and marketing operations, while TSMC has its eyes on some or all of Intel’s chip-making plants, according to the report. Should either company make a successful bid, it would herald the break-up of Intel, and it seems the company’s chairman, Frank Yeary, is ready to accept such offers provided it generates a decent return for investors. According to The Wall Street Journal, Yeary “has been leading the discussions with possible suitors and Trump administration officials, who are concerned about the fate of a company seen as critical to national security… [and] has been telling individuals close to him that he is most focused on maximising value for Intel shareholders,” according to the newspaper’s sources. Intel’s fate is of critical importance to the telecom sector’s network operators and technology vendors as the semiconductor vendor’s products play a key role in every company’s operations and portfolios, to one extent or another, and changes in ownership could impact cost, partnership, supply chain and procurement considerations.

With industry speculation suggesting that its operations in Argentina and Mexico are up for sale, Telefónica’s Latin American upheaval has spread to Peru, where the telco has opted to “invoke the Ordinary Insolvency Procedure of Telefónica del Perú” so it can reorganise the company’s assets. “The financial situation of Telefónica del Perú has been very negatively affected by tax contingencies that are more than 20 years old, as well as by administrative decisions which have placed the company at a competitive disadvantage within a particularly challenging market environment,” explained Telefónica in a note to investors. To help the business in Peru get through its sticky patch, the telco’s regional business division, Telefónica Hispanoamérica, has granted a credit facility of up to €394m to meet the ongoing cash needs of the business. 

Telecom Italia (TIM), which last week provided a strategic update as it reported its 2024 financials, has a new major investor and has expanded into the utilities sector. The new investor is Italy’s national postal service operator Poste Italiane which, among other things, is a mobile virtual network operator (MVNO) that offers its services over the Telecom Italia mobile network. It has completed a share swap with the Italian state lender Cassa Depositi e Prestiti (CDP), whereby Poste Italiane gets the 9.8% stake in Telecom Italia that CDP held, in return for the near 3.8% stake that the mail services company held in digital payments operator Nexi, Il Post has reported. The stake swap comes as Telecom Italia is subject to M&A speculation, as we reported recently. It also comes as Telecom Italia enters the utility services sector, as it has just launched TIM Energia, an electricity supply offer “designed to meet the consumption needs of business owners, professionals and small and medium-sized companies”. TIM Energia was created through a strategic partnership with green energy supplier Axpo Italia, which operates in 40 international markets. “SMEs and professionals who sign up for TIM Energia will have access to a reliable, simple and advantageous energy offer, with energy 100% certified as coming from renewable sources thanks to the Guarantees of Origin of the Energy Services Manager,” noted Telecom Italia in this announcement. 

Ofcom, the UK’s telecom and media regulator, is proposing to make available the upper reaches of the 6 GHz spectrum band for sharing between commercial mobile and Wi-Fi services. It is doing so on the grounds that the division of the bandwidth between two distinct technologies will be of benefit to the British economy overall and will act as a practical demonstration of an approach that could (and presumably should) be introduced elsewhere in the world. The watchdog says the newly allocated spectrum will provide access to considerably increased transmission capacity for both mobile wireless and Wi-Fi services, thus “laying the foundations for future generations of data-hungry technologies, such as virtual and augmented reality, and AI.” In more immediately practicable terms, the effect should be to enable operators to deliver better, faster services to more subscribers, particularly in areas where demand is very high and access can be congested or throttled, such as in sports stadia and other crowded venues and places such as hospitals and railway stations. Users in rural and remote areas would also, allegedly, enjoy better services. Ofcom adds that the new spectrum will also support advanced Wi-Fi in domestic circumstances as well as for enterprises and bigger industries. The proposal stresses that, going forward under the reality of practical spectrum sharing, mobile and Wi-Fi services providers will have to be far better at integrating their technologies. It gives as an example of such improved co-operation, the case of Wi-Fi systems “sensing” the presence of a mobile network and reacting to provide “better services overall”. As it stands, the proposal envisages a two-state process. The first would allow low-power, indoor Wi-Fi across the whole of the upper 6 GHz band as quickly as possible. This is defined as “ideally” before the end of 2025. Phase 2 would permit mobile service providers to use the bandwidth, subject to the result of ongoing discussions “at a European level” on the harmonisation of spectrum usage. These discussions are unlikely to end before sometime in 2027, so mobile companies won’t actually enjoy the benefits of the newly relaxed regime for at least two years. Still, the carrot is dangling there in front of them and no doubt they’ll be reaching out to take a nibble, especially as Ofcom eulogises that European harmonisation “would see sharing of 6 GHz by mobile and Wi-Fi across the continent, and will help manufacturers, operators and users have the confidence to invest in equipment and services for the band, which we are keen to encourage.” Meanwhile, the regulator will also allow outdoor and higher power Wi-Fi to operate in the lower part of the 6 GHz band (5925-6425 MHz), “under the control of an automated database to protect other users from interference.” At the moment, Wi-Fi in this bandwidth is limited to low-power, indoor-use only. Ofcom’s proposals are now out for consultation and interested parties must make their responses by 8 May 2025.

– The staff, TelecomTV