TIM sets aside €548m for risks associated with DAZN deal

Telecom Italia (TIM) has set aside €548 million to cover contractual risks associated with its agreement with sports streamer DAZN, holder of Serie A football rights in Italy.

TIM’s provision includes accrual of the net present value of the negative margin associated with the partnership. Under its agreement with DAZN, the latter provides coverage of Serie A football, including all matches of the 2021-22, 2022-23 and 2023-04 seasons in return for TIM bearing part of the cost of rights.

TIM said that its agreement with DAZN had failed to fuel the lift in ARPU and subscriber numbers that it had expected, with technical problems related to concurrency and rampant piracy contributing.

The pair are currently renegotiating the terms of their contract.

TIM’s EBITDA was negatively impacted by a number of factors including the cost of football, with EBITDA down 21.9% to €1.4 billion for the fourth quarter, and down 6.6% to €6.2 billion for the full year. Group revenues stood at €4 billion, down 4.4% for the quarter, and €15.3 billion, down 1.9% for the year.

TIM has also outlined its plans to separate its infrastructure arm into a new NetCo company, incorporating primary and secondary domestic fixed networks and the Sparkle international wholesale arm.

A separate SerCo will provide services to consumers and businesses in Italy, and will include mobile network and data centres along with TIM Brasil.