France Telecom curbs impact of Free Mobile

26 July 2012 | Kavit Majithia


France Telecom’s sales and profits dropped in the first half of 2012 but there were some indications that the impact of Free Mobile’s entrance in the market was beginning to curb.

Iliad’s Free Mobile entered the French market earlier this year and began operations by offering some existing customers free fixed-line services.

The development caused France Telecom to lose 615,000 customers in the first three months of the year. This number was reduced to 155,000 customers in Q2 and the company’s chief executive Stéphane Richard said the results showed “a marked improvement over the first quarter with a return to growth in the contract customer base in June”.

France Telecom announced increased sales in its Spanish business by 4.8% and the company’s chief executive Stéphane Richard told the Financial Times the company was looking to make acquisitions in Europe. It is thought the company is in the market to acquire TeliaSonera’s mobile unit Yoigo in Spain.

The group’s sales fell 2% to €21.8 billion, largely due to a 4.5% decline in France.