France to seek consolidation in mobile market

The French government has announced its intention to actively encourage consolidation in the country’s mobile sector, in an effort to bring an end to the price war in the mobile market.

The government plans to bring the number of mobile operators down to three, which they hope will end the price war and encourage investment in 4G services.

Since joining the market two years ago, Iliad has been leading a price war in the French market, forcing rival operators to lower their prices to compete with its low-cost deals. Strong competition has resulted in falling revenues in the French mobile market.

“Our policy of re-consolidating the sector, of bringing it down to three operators, remains all the more relevant. We will work actively in this direction," said economy minister Arnaud Montebourg in a parliamentary committee hearing this week.

The announcement follows Numericable’s €17 billion acquisition of Vivendi’s mobile unit SFR.

Rumours this week suggested that Iliad and Bouygues Telecom are reportedly looking into a merger as part of a drive towards consolidation.

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