REGISTRATION DOCUMENT AND FINANCIAL REPORT - Iliad

6. OVERVIEW OF THE GROUP’S BUSINESS
6.1 PRINCIPAL ACTIVITIES
protocol, unlike conventional transmission networks which use ATM/SDH protocol. The Freebox DSLAM has a
Giga Ethernet output and was designed to accommodate the high bandwidth requirements of the new audiovisual
services launched in December 2003.
The Freebox modem. The Freebox modem is a multi-function ADSL modem developed to enable customers to
receive services that can be offered via broadband Internet access. In addition to traditional access using a
personal computer connected via a USB or Ethernet socket, the Freebox modem has one telephone socket for
voice-over-ADSL services and a SCART TV socket and is capable of decoding audiovisual content compressed
in MPEG-2 and MPEG-4 formats.
A new Freebox was unveiled on April 19, 2006: the HD Freebox. Designed and developed by Iliad’s research
and development team, it is fitted with a range of features, including a DTT tuner, WiFi MiMo (Multiple Input
Multiple Output), PLC technology, Freeplugs, and high definition television. It also features an encoder and hard
disk.
The Freebox modem and the Freebox DSLAM include components acquired from third party suppliers and
assembled by companies which are not part of the Group. However, the software used has mainly been
developed in-house by the Group using open source software such as Linux.
The use of both the Freebox modem and the Freebox DSLAM allows Free to provide its customers with the best
in ADSL and ADSL 2+ technology as well as a very high theoretical bandwidth (up to 28 Mbit/s) while reducing
the loss of bandwidth over distance. Free has used this high bandwidth capacity since December 2003 to offer
value-added optional services such as audiovisual services over ADSL (MPEG-2 and MPEG-4 formats) and
voice services, as well as high-speed Internet access of up to 28 Mbit/s since July 2006.
Free’s unbundled service offering enables the company to have complete control over the network from end to
end and thereby over the transmission of traffic and the quality of its services, with:
• a presence on the subscriber’s premises in the form of a Freebox modem;
• a presence in the France Télécom sites in the form of the Freebox DSLAM;
• optical fibers between the France Télécom sites and Free’s regional POP; and
• optical fibers between Free’s regional POP and the Free server center.
Telephone service offered to subscribers with a Freebox modem
Since August 25, 2003, Free has been offering a voice-over-ADSL (VoDSL) service to all its subscribers with a
Freebox modem, enabling them to make and receive calls over a fixed-line telephone connected directly to their
Freebox modem. In order to receive this service, the Freebox subscriber applies for a new telephone number on
Free’s website. Free is the first operator in France to provide this type of offering. Based on a policy of
per-second billing and a very attractive per-minute tariff, Free’s telephony service is very appealing not only for
local, national and a large number of international calls, which are free, but also for other international calls and
calls to mobile phones (see above for details of the telephone service provided through the Freebox modem). The
availability of this service to Freebox subscribers is a result of the upgrading of the Group’s network since 2002
to allow it to carry voice traffic, combined with the impact of developing a billing system following the takeover
of One.Tel, and the company’s control over the design process for Freebox DSLAMs and modems.
Since March 18, 2004, as shown in the table entitled “Details of Internet access services provided by Free”
above, each new subscriber under Option 1 or Option 5 has been provided with a Freebox modem free of charge.
This gives them access to the ADSL telephony offering which includes free local and national calls to fixed
telephones in mainland France and 70 other countries.
Audiovisual content offered to subscribers with a Freebox modem
At the end of November 2003, Free launched an audiovisual content service available from December 2003 to all
subscribers with a Freebox modem in an unbundled local loop area. This offering allows subscribers to receive
free-to-air general interest or public service channels, as well as pay channels and packages from €0.25 per
month by linking the SCART socket of the Freebox modem to their television.
Iliad – Registration Document 2007 - 35