When you have operating costs of 2 billion EUR ($3.1 billion) per year, it’s only obvious you want to cut them down. Telecom Italia acknowledged this problem and is embarking on a wide-ranging cost cutting strategy to reduce the expenditure. The goal is to cut a total of 40% of cost base within the next seven years in order to boost the company’s profitability.
One of the ideas is to invest in optical fibre infrastructure that would require less maintenance while providing higher service quality. In addition, cuts will be made across Telecom Italia’s customer service, advertising and marketing efforts.
But it’s not all about the cost cutting, Telecom Italia also eyes expansion in other markets. The company’s chief executive Franco Bernabe said he is in talks with private-equity partners to co-finance international deals, to help Italy’s largest operator expand its overseas operations through smaller joint-ventures in developing countries.
According to Financial Times, TI’s share price has fared worse than other European incumbent telcos this year, falling almost 35%.
[Via: FT]