REGISTRATION DOCUMENT AND FINANCIAL REPORT - Iliad

6. OVERVIEW OF THE GROUP’S BUSINESS
6.2 PRINCIPAL MARKETS
Since mid-2002, most of the Group’s main competitors have decided to focus on providing ADSL-based
broadband offerings. The proliferation of different service offerings accompanied by increased segmentation and
strong competitive pressure on prices stimulated growth in the Internet market between 2003 and 2007.
Over the last two years, Orange, Neuf and Free have established themselves as the major players in the market.
Since the end of 2002, local loop unbundling has provided a major opportunity for growth for the Group,
particularly with regard to profitability and the development of service offerings (such as fixed telephony and
audiovisual services).
In addition to pursuing market growth for broadband access in order to increase broadband use in the home as a
means of winning new customers, Internet service providers also aim to migrate as many subscribers as possible
from dial-up services to broadband in order to benefit from higher average revenue per user.
6.2.2 Telephony operators
Competition in the fixed telephony market is characterized by the overwhelming dominance of the incumbent
operator and by the considerable number of emerging operators.
Since January 1, 2002, all subscribers have been able to choose which operator to use for local calls, as had
already been the case since January 1, 1998 for long distance and international calls and since November 1, 2000
for fixed-to-mobile calls. The operator can be selected on a call-by-call basis or by automatic carrier
pre-selection which allows subscribers to specify that all calls be automatically routed through the operator of
their choice. There was a significant fall in subscribers opting for carrier selection in 2007 and this trend looks set
to continue. Based on information published by ARCEP, there were some 39.2 million telephone service
customers (retail and corporate) in France at end-2007, including 5.3 million who had opted for carrier
pre-selection and 1.7 million for call-by-call selection.
The following table taken from ARCEP provides a breakdown of fixed telephony subscriptions.
100%
80%
60%
40%
20%
0%
Répartition des lignes fixes supportant le service
téléphonique selon le nombre d’abonnements téléphoniques
3%
4% 5% 8%
9%
10% 12%
10% 14%
12%
12%
13%
14% 14%
88% 86% 84% 81% 77% 75% 72%
T1 2006 T2 2006 T3 2006 T4 2006 T1 2007 T2 2007 T3 2007
uniquement abonnement RTC deux abonnements (RTC et IP) uniquement abonnement Vo IP
In order to boost its position vis-à-vis its principal competitors (France Télécom, Neuf Cégétel, TELE2), One.Tel
is continuing to encourage its customers to opt for carrier pre-selection and is firmly positioned as having one of
the most attractive pricing structures of any alternative operator in the market.
Iliad – Registration Document 2007 - 41