MuniWireless

ARCEP, the French regulator, released the results of its quarterly survey on the electronic communications services market in France for Q1 2008.  In the first quarter of 2008, fixed and mobile telephony services in France accounted for 54.2 billion traffic minutes, up 4% from the same period last year. They generated a total revenue of €10.7 billion, to which was added €2 billion for interconnection services and sales on the wholesale market between operators. The net revenue from electronic communications services alone in the end user market (i.e. excluding operators’ related revenues like sales of terminals, directories, advertising, hosting or call centre management, etc.) was €9.9 billion in Q1 2008 (an increase of 3.1% over one year).

Broadband VoIP rescues fixed telephony

In the fixed telephony and Internet segment, the survey claims there are 40 million subscribers to a telephone service as of the end of Q1 2008. The growth of this number is attributed to the success of broadband telephony (VoIP). France now has 11.9 million subscribers to a broadband VoIP service, representing 30% of all fixed telephony services. This number is growing at the rate of 1 million new subscribers per quarter. Dial-up subscribers are declining at a rate of 700,000 per quarter. They were 28.1 million at the end of Q1 2008. Customers are now switching their PSTN lines to support only VoIP and DSL or cable services. Operators have created a “naked ADSL” offer based on fully unbundled lines taking advantage of the regulation requiring France Telecom to open its “historical” local loop to other operators.

Unlimited “free calling” bundles

The revenue attributed to traditional fixed telephony (subscriptions and calls) was €2.6 million in Q1 2008, declining 4.6% year to year. The subscription part of this revenue grew slightly (1.4%) and the revenue from the calls plunged 10.9%. Traffic originating on fixed phone lines reached 28,1 billion minutes for Q1 2008, a 4.7% increase from the Q1 2007. IP calls represented 11.4 billion minutes or 40.5% of the traffic, growing 57.6% over a year. This strong movement can be explained by the marketing of new telephony-on-IP offers which systematically include unlimited calling to national fixed phones in bundled packages. IP traffic was particularly high to destinations benefiting from so-called “unlimited calling” offers (offers included in most multiplay packages). For fixed international calls, the share of IP was even significantly higher (59%). It was also high (42%) for national calls, but was just 18% for fixed-mobile traffic (for which there are no “unlimited calling” offers).

DSL is king

There were 17.6 million subscribers to Internet access at the end of Q1 2008, of which the vast majority (92.4%, or 16.3 million) was for high-speed Internet service. The number of high-speed subscriptions rose by 2.6 million over one year (+18.8%). ADSL technology took the lion’s share, with 15.5 million at the end of the first quarter 2008. Revenues from the Internet access business topped €1.2 billion in Q1 2008.

- - - - - - - -

About the author

Alain Baritault is the Editor in Chief and co-founder of Cités Numériques, a French publication for elected officials and technology decision makers in the French municipalities, territories and the national government. He has been a journalist, analyst and columnist based in Silicon Valley for the past 20 years covering technology and business for French magazines and newspapers as 01 Informatique, La Tribune, Sciences et Vie Micro and l’Informaticien. Along with his press activities, he has been an analyst and consultant for French companies, organizations and local governments focused on emerging technologies as wireless technologies and all technologies related to mobility. He is also following the emerging ultra high speed broadband market in France. Previously Alain was Editor of several French computer magazines as Decision Informatique and Temps Micro. He has an MBA and post-graduate degree (DEA) from University Paris 9 Dauphine.