France is Europe’s leading market for VoIP and IPTV services, both of which are hugely popular. Three main service providers – neuf Cegetel, France Telecom and Free (Iliad) – compete for customers. VoIP traffic accounted for 17% of all voice traffic by mid-2006, and was forecasted to reach about a third of all traffic by the end of 2007, placing a major strain on France Telecom’s voice revenue. In addition, VoIP-only providers may face the wall in coming years as the technology becomes a minor component of content-driven triple and quad play offerings.
Digital TV take-up was boosted in 2006 with the launch of numerous channels and a geographic widening of the service’s reach. The merger of Vivendi Universal with Canal+ and TPS effectively presented Vivendi with control of the French digital pay-TV market. Seven of the nine new-launch DTTV channels were reprimanded in September 2006 over their performance and broadcasting quotas, prompting further diligence from the broadcasting regulator to oversee the sector in 2007 and coming years.
France’s mobile penetration rate remains substantially lower than the EU15 average, but thus provides considerable room for further growth in 2007. The MVNO market share is likely to remain relatively small in coming years, perhaps gaining 17% of the market by 2010, compared to 27% in neighbouring Germany. Threats to the dominance of the main network providers exist from a growing number of low-tariff providers and third-party resellers. Despite their small market share, these operators rapidly increased their subscriber base in 2006 and were certain to continue this growth as the government remains determined to develop the sector as an effective competing force.
Growth in the Swiss mobile market slowed during 2006, with the market approaching saturation, yet the mobile data sector promises to considerable progress in 2007 given that almost half of Swiss households have UMTS/GPRS phones. Data applications such as MMS have become increasingly popular, while data technologies such as HSDPA have been widely promoted.
Growth in the Swiss broadband market continued strongly in 2006, while new legislation to make the provision of broadband a Universal Service Obligation in early 2007 will dramatically increase broadband availability to outlying rural areas.
France remains a leader in high speed broadband developments, with ADSL2+ and VDSL2 roll-outs gaining momentum, and thus stimulating demand for triple play services. The fibre sector has become one of the most advanced in Europe, supported by innovative municipal projects in Paris and other major towns, and expecting to deliver fibre to at least 80% of all buildings by 2010. The provider Free launched an ambitious regional fibre deployment using an open network strategy, promising great opportunities for competing operators and content providers in coming years, which will have access to some ten million people.
Regulatory controls have continued to advance broadband in France. By mid-2006 local loop unbundling was available to around 54% of installed lines, making France the second largest ADSL market in Europe. Recent growth has come mainly from fully unbundled lines, and the trend is likely to continue into 2007, thus creating further difficulties for France Telecom as the company haemorrhages customers to streamlined and cheaper competitors. For those needing high level strategic information and objective analysis on this region, this 100+ page report is essential reading and gives further information on:
How municipal backing for widespread fibre networks will affect promote take-up of triple play services and provide further opportunities for content providers; How increasing demand for VoD and IPTV will stimulate higher bandwidth connections beyond urban areas; How the impending digital switchover will impact on broadcasters and content; The changing face of converged media with widespread triple play services becoming a standard feature in homes.
