FREEMOBILE TO CHALLENGE THE FRENCH MOBILE INCUMBENTS
RUNNING HEADER: FREEMOBILE TO CHALLENGE THE FRENCH MOBILE INCUMBENTS
FREEMOBILE TO CHALLENGE THE FRENCH MOBILE INCUMBENTS
DANIEL TORO
SOUTHERN NEW HAMPSHIRE UNIVERSITY
FEBRUARY 20, 2015
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RUNNING HEADER: FREEMOBILE TO CHALLENGE THE FRENCH MOBILE INCUMBENTS
Identify The Key Economic Characteristics Of The French Wireless/Telecom Segment
(U.S. Sic Code 4813, Uk Sic 6110) Of The Communications Services Industry.
The French telecommunication market is considered to be the largest in Europe with a valuation of $29.2 Billion dollars. Previous to 2012, the mobile communications market was control by three companies (France Telecom's Orange, the Vivendi-owned SFR, and Bouygues Telecom).
In a push by the French government to bring prices down, created a new legislation to let telecommunication companies to place new bids to award new licenses for the 3G and 4G. Iliad group decided to place a bid to win the licenses for the 3g and 4g business and won it. However, one of the conditions by the French government was for Freedom mobile to be able to cover 75% of the French population by January of 2015.
Free mobile understood that the telecommunication industry was operating inefficiently and that the implementation of new technology (Internet and Wi-Fi) could bring the cost down and improve its service to the end user. The company started offering lower cost plans with better benefits that its competitors; this strategy was aimed to take its competitors customer with a very minimal investment in marketing or opening new retail stores, the idea was to fight its competitor mainly on price. The perception of this new player in the telecommunication industry has been well received by the customers but not by the competition, “The company's mobile proposition offered a 50–60% price reduction on the cheapest closest-matching plans offered by the most price-aggressive mobile operators and low-cost brands.” (stylehatch, 2012).
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RUNNING HEADER: FREEMOBILE TO CHALLENGE THE
FREEMOBILE TO CHALLENGE THE FRENCH MOBILE INCUMBENTS
DANIEL TORO
SOUTHERN NEW HAMPSHIRE UNIVERSITY
FEBRUARY 20, 2015
1
RUNNING HEADER: FREEMOBILE TO CHALLENGE THE FRENCH MOBILE INCUMBENTS
Identify The Key Economic Characteristics Of The French Wireless/Telecom Segment
(U.S. Sic Code 4813, Uk Sic 6110) Of The Communications Services Industry.
The French telecommunication market is considered to be the largest in Europe with a valuation of $29.2 Billion dollars. Previous to 2012, the mobile communications market was control by three companies (France Telecom's Orange, the Vivendi-owned SFR, and Bouygues Telecom).
In a push by the French government to bring prices down, created a new legislation to let telecommunication companies to place new bids to award new licenses for the 3G and 4G. Iliad group decided to place a bid to win the licenses for the 3g and 4g business and won it. However, one of the conditions by the French government was for Freedom mobile to be able to cover 75% of the French population by January of 2015.
Free mobile understood that the telecommunication industry was operating inefficiently and that the implementation of new technology (Internet and Wi-Fi) could bring the cost down and improve its service to the end user. The company started offering lower cost plans with better benefits that its competitors; this strategy was aimed to take its competitors customer with a very minimal investment in marketing or opening new retail stores, the idea was to fight its competitor mainly on price. The perception of this new player in the telecommunication industry has been well received by the customers but not by the competition, “The company's mobile proposition offered a 50–60% price reduction on the cheapest closest-matching plans offered by the most price-aggressive mobile operators and low-cost brands.” (stylehatch, 2012).
2
RUNNING HEADER: FREEMOBILE TO CHALLENGE THE