FASTWEB masters full TV services.

The days of satellite dishes, TV antennas, bundles of coaxial cables, VCRs and DVD players seem to be quickly slipping away. In Europe, since 2001, FASTWEB, Italy's largest alternative broadband telecommunications operator, has managed to meet almost all entertainment and business needs through a simple Internet protocol (IP) network.

FASTWEB was created in Milan in 1999 by Francesco Micheli and Silvio Scaglia, making it the world's first player using an all-fiber network and full IP platform for the integrated management of a Triple Play service delivery (voice, data and video). Together with FREE in France and PCCW in Hong Kong, FASTWEB is among the first companies in the world to use IP Television (IPTV) technology over broadband.

Today, a new generation of networks provides a complete alternative to the traditional telephone infrastructure. Plus, value-added services can be used simultaneously over a single connection. For personal use, all that customers need to have in their possession is a traditional TV and an optical fiber terminal; and they are eligible for a wide range of features via a set-top box. Users can access all main Italian TV channels and a series of free and pay-TV digital channels, including France's TV5, Spain's TVE and the U.K.'s BBC. Viewers receive VoD access to a library of more than 5,000 programs supplied by the FASTWEB-owned ONtv channel and Italy's RaiClick channels. ONtv provides games, music, e-commerce, sitcoms and dramas, among other things. RaiClick provides more than 3,500 titles, including news and movies.

Movie titles come from direct deals with studios such as NBC Universal, 20th Century Fox, Dreamworks and Disney, while domestic fare is from Medusa. All titles are also available in their original languages.

The IPTV technology has also managed to make VCRs almost extinct: by simply pushing a button on a remote control, users can view and record their favorite programs with all the additional features: fast-forward, pause, stop and rewind; they can surf the Internet, check email, and even receive fax and phone messages--all from their TV sets.

For businesses, the FASTWEB technology offers voice-over-IP (VoIP) telephone services and broadband Internet access, new generation video communication and conferencing applications, virtual private networks (VPN), business-to-employee (B2E) services, audio and video streaming, tele-surveillance, web housing, web hosting and bandwidth-on-demand.

Today, FASTWEB is accessible in all major Italian cities and urban areas. Last-mile access is provided either on an optical fiber connection (Fiber-to-the-Home/Fiber-to-the-Office solutions), available in Italy since 2001; or over unbundled ADSL lines, available since 2003. The residential offer provides Internet access at the top speed available today in Italy (up to 10 Mbit/s for optical fiber and 6 Mbit/s for ADSL).

Currently, FASTWEB fiber network reaches 5.9 million Italian homes, and is expected to hit the 30-million user mark by the end of 2006. Today, FASTWEB counts 500,000 million users. Of these, 150,000 are also IPTV subscribers who spend an average of 30 euro per month: 20 euro to acquire programs from pay services such as SKY Italia, and 10 euro for VoD services.

FASTWEB's average revenue per unit (ARPU) for 2004 was 340 euro per client, which, in 2005, will come to an estimated 40 million euro in revenues, 15 million of which will be purely profit.

Listed on the Italian Stock Exchange's Nuovo Mercato for high-growth stocks, FASTWEB is one of the top 40 Italian stocks in the S&P index.

A full report on FASTWEB, including details on its business model and licensing arrangements with content providers, will be published in the October issue of VideoAge.