French supermarket giant halts MVNO service, blames Free Mobile

Carrefour, the French supermarket giant, is terminating its MVNO agreement with France Telecom Orange, blaming rising competition from Free Mobile.

The company will continue to offer a service under the Carrefour Mobile brand. However, it will only be a trade mark licensing deal with Orange and its existing customers will be transferred to Orange.

"The arrival of a fourth operator [Free Mobile] has changed the configuration of the market," a Carrefour spokesperson told La Tribune, adding that the company didn't want to disguise the fact that it was difficult to continue in such conditions.

Neither company has detailed what impact this might have on the financial agreement between them, of if any staff responsible for Carrefour's MVNO business will be employed by FT Orange.

Carrefour is thought to have attracted several tens of thousands of customers to its widely promoted mobile phone service.

Regardless of this setback, the supermarket will continue to promote low-cost mobile services under the 'Carrefour Mobile Orange' branding. The two new offers, which will not appear in Orange retail outlets, provide 100 voice minutes and 500 text messages for €4.99 per month, and prepaid cards from €4 to €48 per month valid for six months.

"This [Carrefour Mobile Orange] brand allows us to address the mass distribution sector, aiming for those with a budget of under €8," the marketing director of FT Orange told La Tribune, adding: "This brand licensing is very complementary to the one we have with Système U, but positioned more on niche areas."

Carrefour's CEO, Georges Plassat, recently unveiled a turnaround plan after announcing a net loss of €31 million in the six months to the end of June, down from a net loss of €249 million in the same period last year. Net sales were up 0.9 per cent year-on-year at €38.8 billion, according to the Financial Times.

Plassat has confirmed that the plan involves reducing debt and reorganising some assets, such as its property portfolio, and making 600 staff redundant.

For more
- see this La Tribune article (translated via Google Translate)
- see this 4-Traders article
- see this Financial Times article (reg. req.)

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