Telcos Like Telecom Italia Are Failing European Startups And It’s Got To Stop

Italy, like many Southern European countries, is struggling with an economy in the doldrums. But the innovators in this proud and ancient country are not sitting idly by. As our Techcrunch Italy event attested to this week, there has been an explosion in the number of startups coming out of the country. It may not be the biggest scene in Europe yet, but it is clearly hitting a growth spurt. Young people, in particular, are voting with their feet and joining the ranks of entrepreneurs. So when we put on TechCrunch Italy with our partner Populis, we found a great venue, the amazing Maxxi Museum, and set about getting great speakers. What we didn’t count on was Telecom Italia.

Less than one kilometre from Maxxi Museum is a business and residential area served by third party fibre providers like FastWeb. Fibre of course is amongst the best options when you want real broadband.

And yet the Maxxi Museum, unfortunately, does not have access to fibre, despite having good wifi coverage inside the building. So we found a satellite provider (yes, satellite) and put in a system we thought could serve the conference. The satellite system was sold us by Telecom Italia but was provided by one of their subcontractors, Digitaria.

But although we brought in enough bandwidth into the building to serve the 1,000+ delegates, Telecom Italia failed us. Miserably.

Despite a big satellite connection, Telecom Italia gave us a router that was simply not capable of dealing with the bandwidth we actually had access to. It was only by the second day of the conference that we were able to obtain a bigger router which could serve the conference.

But even then, we had to get the router from another company to fix the problem. Telecom Italia did not even fix the issue and did not supply a new router. This, despite the conference paying tens of thousands of Euros for their “service.”

But this is not a post just to bitch about Telecom Italia.

It’s a post that to highlight the fact that without decent Internet access you simply don’t get economic development. Countless studies are have long since proven this. It’s a fact.

But just getting decent, full-blown broadband in some parts of Europe is still a ridiculous experience. A report from shows that in half of the EU’s 28 member states there is no real competition in the telecoms sector.

And here’s an international conference, bringing in international speakers, and people who could potentially invest in a country – and what happens? You can’t get online. It’s basically a disgrace to Telecom Italia.

And it’s a disgrace when this happens at other events – when it’s not down to the organisers, who do their best to get often extremely expensive broadband into the building to service Internet-hungry delegates. These are delegates who are part of the fastest moving sector in business, one of the few growth areas in the world today.

This is the way Telecom Italia behaves when often an official from the Italian government turns up and tells all the startups how great they are. Awesome – but everyone knows they are sitting in a conference where people can’t even get online.

So as great as it is that the European Commission is beating the drum about 3G roaming costs and supporting startups, but let’s just be clear – they need to beat up on these lazy ass telecoms companies who are siting on their asses doing nothing to help their own damn technology ecosystems.

It’s highly ironic, because Italy is one European country which contains a passionate set of players, like Luca Ascani of Populis, who are really trying to grab their country by the ears and haul it into the faster era of tech startups. But they simply cannot operate in an environment where basic, simple broadband is hard to come by. Without that, none of the innovation we expect to come from startups will happen.

It was a point well made by Zaryn Dentzel, founder of Tuenti, who has been one of those participating in the Startup Manifesto project to lobby Europe and European governments on behalf of startups.

This is an excellent initiative which addresses issues like taxation, stock options, etc.

But all of that work will be wasted if we can’t get the broadband speeds we need to create the next generation of companies.

Also, Francesco Caio, head of the Italian government’s “Digital Agenda” initiative. He spoke about how tax benefits will be created by October to ignite Italian startups and investors. He estimates there are now 1148 tech startups in Italy now – an enormous difference in the last 3 years alone.

Unusually for a government appointee he was brutally frank: “Italy is number 9 on the global scale for engineering talent, – it drives me up the fucking wall that people don’t know this.”

We heard from Mattia Corbetta, Chief of the Italian Minister of Economic Development’s Technical Secretariat. He outlined how Italy is trying to re-design its labour laws and regulations around startups, such as flexible pay structures, and new rules around stock options and equity to incentivise entrepreneurs.

So, Italy, like many other European countries, has the talent and is starting to create the will amongst government and business leaders to change its economy and re-orient it towards the future and an information economy.

All of this effort – all of it – will be wasted if state monopolies amongst telcos and the slow-lane of their service culture is not smashed and disrupted.

We do not want to be left with an ecosystem which has a fantastic environment for startups, great incentives for investors, tonnes of talented people – but no-one can get online and get fast broadband.