FTE » Topics » Concentration of Broadband Competition

This excerpt taken from the FTE 6-K filed Apr 14, 2009.

Concentration of Broadband Competition

Broadband represented 93% of Internet subscriptions at the end of the second quarter of 2008 and DSL lines represented 94.9% of the broadband accesses (source: ARCEP, Market Observatory at September 30, 2008).

The leading Internet service providers, as well as the network operators, chose to invest in their infrastructures in order to migrate towards unbundling.



2008 REGISTRATION DOCUMENT / FRANCE TELECOM73



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At September 30, 2008, the unbundled zones covered 74% of the population.


 

Year ended December 31

 

2008

2007

2006

Number of distribution frames available for unbundling

3,668

2,956

1,789

Number of unbundled lines (thousands) (partially and fully)

6,332

5,187

3,940

Number of fully unbundled lines (thousands)

4,939

3,624

2,120

Source: ARCEP, Unbundling Indicators (third quarter 2008).


Full unbundling allows alternative operators and Internet service providers to provide their customers with a single bill including the telephone line subscription, telephone calls and broadband services (Internet access, television via ADSL and VoIP).

In the traditional voice market, there was a decline in the number of subscriptions with carrier selection, both on a per-call basis and with pre-selection, down 26% between June 2007 and June 2008 (source: ARCEP, Market Observatory), which was tied to the growth in VoIP. VoIP grew strongly in 2008, with France Telecom’s rivals gradually leading their customers to “all IP” offers built around full unbundling and naked ADSL. Changes in voice over IP communications are as follows:


 

Year ended December 31

 

2008

2007

2006

VoIP Communications (in % of total volume of communications)

44.2

38

34

Source: ARCEP, Market Observatory (third quarter 2008).


Most of the players have a “triple play” offer (Internet, telephony, television): Free, Neuf Cegetel, Numéricâble. In 2008, the retailer Darty introduced an ADSL offer with a triple play option, using the Completel network.

Fixed-line and mobile convergence offers appeared in 2006 with: Unik, the convergent GSM/Wi-Fi telephone from France Telecom, the Wi-Fi modem from Free adapted to allow telephony over Wi-Fi with a hybrid telephone, Twin, and the hybrid telephone from Neuf Cegetel over GSM and Wi-Fi. They continued their development in 2007, improving the range of Unik terminals and with the introduction of Net & Unik by France Telecom. Convergence is also illustrated by the option of having the same audio-visual content on different media (television, mobile telephone or computer).

The first investments in optical fiber (FTTx) were launched at the beginning of 2007 by France Telecom, Iliad and Neuf Cegetel. The first meeting of the Very High Speed Committee took place at the end of 2008, with the signature of an agreement for the installation of optical fiber in France and the launch of tests covering mutualization.

Optical fiber will enable higher speed and new value-added services.

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