Again, it becomes a habit, officials of Iliad, the parent of Free, showed great satisfaction at the presentation of first half results on Wednesday in Paris. The financial performance is looking good with revenues of € 2.3 billion (+ 6.3% over a year) and profits up 17% to € 190 million.
The group is particularly pleased to be once again become the market number 2 on the fixed with 6.3 million customers against 6 million a year ago, representing a market share of 37%. The operator had lost that position following the merger between SFR and Numericable. “We caught the delay in less than 18 months, which once again proves the relevance of our model”, is congratulated Maxime Lombardini, CEO of the group.
“We take advantage of our fully unbundled network wide, not just limited to high-density areas “, asserts the head,” but also because we are the only ones not charge monthly the box “. These arguments are in effect, such as the price supplied by multiple online promotions offered by the operator on-sale privée.com. A strategy that inevitably weighs on the average revenue per subscriber.
Thomas Reynaud (CFO) and Maxime Lombardini (general manager)
“We assume fully this strategy, the number of promotions is the same as last year. There is a slight pressure on ARPU, which is 33.9 euros months, but this is not an issue for us, “adds Thomas Reynaud, CFO.
2016, the year of inflection in the fiber
To consolidate this position, Free will accelerate in fiber optics: the group now has 250,000 subscribers (+ 25% in one year) to 3.1 million and made a target of 4 million at the end of this year (20 million at end 2022) through use in less dense areas of EPON technology less expensive and easier to deploy than GPON used previously in very dense areas. “The investments are starting to bear fruit, year 2016 is a true inflection,” said Maxime Lombardini.
But the CEO is concerned about the weight of growing Orange in this sector. “The incumbent is on a too easy terrain, the regulator must act, we can not let him climb to 80% market share, we need improvements.” Iliad he blames Orange to invest? “As a percentage of sales, they invest less than us. But the main problem is the exchange of information at Orange, information that we do not have.”
Meanwhile these “arrangements” claimed, Free will not engage as its competitors in exclusive content convergence strategy to enhance its offerings. “When you see the results elsewhere, this is not very convincing”, asserts the head. “We remain true to our strategy of distributing everybody.”
As for the new Freebox (v7), expected to be launched this year, it’s radio silence, Maxime Lombardini refusing to deliver any comment on the issue: “we usually never comment a product or service that is not yet available. ”
No news of the new Freebox
On the side of the mobile, the engine still running at full speed with a gain of 400,000 customers and revenues up 14%. For 18 quarters, Free Mobile remains the leading recruiter net subscribers and now climbed to 17% market share with 12 million customers. The group emphasizes the strong growth in the premium package at $ 19.99 per month (record of recruitment in H1) and migration from the package 2 euros also rising. Without giving figures on the breakdown or the ARPU …
The 4G covers 69% of the population remains the engine of this growth (5 million subscribers, a 4GB average months of data consumed) and Free will accelerate thanks to the rapid improvement of its coverage (75% referred to the end of the year) and the use of its new frequencies (700 MHz). Only gray area: the consequences of the phasing out of homelessness 2G / 3G with Orange that may impact the less dense areas subscribers. Remember that this phasing out will be accompanied by a gradual drop theoretical speeds offered through this agreement.
The group promises to fill the gaps as quickly as possible, its 3G coverage is 85% today the population, much less in terms of territory. “Our deployments are faster than the competition,” said the group nevertheless compares different times …
Free Mobile also intends to feed this virtuous circle with the likely arrival in Italy. Recall that the group is in exclusive talks to resume many assets from the merger of Hutchison and VimpelCom in the country. Once the merger approved by the European Commission, the operator can start almost immediately, with an equally aggressive model.
“We have the capacity to be operational very quickly with many assets to to become number four in the country, “said Maxime Lombardini. And to put forward a roaming agreement in the country “just 10 times cheaper than in France” …
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