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French operators report mixed fortunes


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Three of the four main mobile players in the French market reported their results this week, with the results of low-cost new entrant Free Mobile contrasting with those of established players SFR and Bouygues Telecom.

In the 15 months since its launch, Free has secured around 9 per cent of the mobile customer base in mainland France. The launch of its low-cost, no contract tariffs sparked widespread price cuts in the market, as the existing operators looked to improve the appeal of their products in response.

Illiad Group, parent company of Free Mobile, said that sales in its mobile business had increased by 202 per cent to €294.5 million from €97.5 million, with the company adding 870,000 mobile subscribers during the first quarter to take its total to 6.08 million.

While Illiad did not report income figures for the period, the company has previously recorded losses related to the ramp-up of its mobile business.

Meanwhile, revenue at SFR fell by 11.4 per cent to €2.59 billion from €2.93 billion, with EBITDA decreasing by 41.5 per cent to €328 million from €561 million.

Mobile revenue of €1.64 billion was down 17.4 per cent.

Parent company Vivendi said that the figures had been impacted by price cuts as a result of competition in the French market, as well as cuts related to regulation. Without the impact of regulatory decisions, revenue fell by 7.3 per cent.

Vivendi is reportedly considering options including an IPO of SFR, as the media and telecoms conglomerate looks to shift its balance in favour of the former from the latter.

At the end of the quarter, SFR’s total mobile customer base was 20.72 million, with growth in its contract customer base offsetting weakness in its lower-cost prepaid propositions – the market where Free is active.

And Bouygues Teelcom showed “good commercial resilience”, its parent said, gaining 20,000 new mobile customers during the quarter.

Its telecoms revenue for the period was €1.15 billion, down 16 per cent from €1.37 billion, noting that in the first quarter of 2012 it had “not yet been hit by the disruption in the mobile market”.

The company said that measures taken last year would secure savings of €400 million in the mobile business this year, instead of the €300 million initially planned. It said that additional measures decided in the first quarter of 2013 “are in progress and have still not paid off”.

France Telecom-Orange, the other key player in the French mobile market, reported its first quarter numbers late last month.

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