France Telecom has issued a robust defence of the amount it charges competitors for accessing its network: rivals, led by Vivendi, have accused the incumbent of abusing its dominant position at home.
Louis-Pierre Wenes, deputy managing director of Orange France, France Telecom's brand name, rejected demands that the former monopoly split off its fixed-line network activities as "attempts by our competitors to try to change the rules of the game and raise their profits," according to the Financial Times.
Vivendi and Iliad, owner of Free, France's second-largest ISP, have filed a legal complaint with the European Commission alleging that France Telecom is stifling competition.
They claim France Telecom's â‚¬7 billion ($9.4 billion) in earnings before tax and amortisation last year - as opposed to â‚¬700 million for Vivendi's SFR and â‚¬400 million for Free - is evidence of the former monopoly's continued dominance, FT says.
The two rivals claim the incumbent operator is over-charging its rivals for access to its copper-wire network. They also contend it has overpaid for television content, such as football rights and cinema, in an attempt to squeeze pay-TV rival Canal+ and competing internet service providers offering broadband TV.
Wenes pointed out that France Telecom was losing 200,000 fixed-line customers every quarter and that this demonstrated there was intense competition. The former monopoly invested â‚¬3.2bn last year to maintain and upgrade its fixed-line network, he said. "The copper network is getting old."
He added that the termination fee it charges to connect rivals with fixed-line customers was â‚¬0.51, well below the European Union average of â‚¬0.86, while the monthly access charge for using its copper-wire network was in line with the western European average of â‚¬9.29.