Orange, Alcatel-Lucent CEOs reiterate pleas for French consolidation

The CEOs of Orange and Alcatel-Lucent continue to call for greater consolidation on the French market--a move they say would provide a more level playing field for the market's mobile operators.

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Orange CEO, Stephane Richard

According to Reuters, Orange CEO Stephane Richard said consolidation has now become an "urgent" need, and that there could be some movement in this direction in the coming weeks.

"It is urgent after the deal that was signed between SFR and Numericable," Richard said in an interview with French radio BFM, Reuters reported.

While Orange and the French government had hoped SFR would merge with Bouygues Telecom to reduce the number of French mobile players from four to three, Vivendi agreed to sell the unit to Altice instead. Altice plans to merge the mobile operator with its majority-owned Numericable cable unit, thus creating an even stronger player on the market that would compete with Orange, Bouygues Telecom and Free.

Alcatel-Lucent CEO Michel Combes also added his voice in favour of a greater consolidation of the market, saying it was time to reform the country's politics of competition, according to Les Echos. Also interviewed by BFM this week, Combes said a greater "rapprochement" between operators would allow them to realise the necessary investments for their networks. That, of course, would be good for Alcatel-Lucent's business too.

France's government has already been pushing for greater telecoms consolidation to reduce competition, and reports emerged earlier in May that Orange is in talks with Bouygues over a possible merger with its telecoms unit. Numericable has also made an offer to buy Virgin Mobile France, which operates as a full mobile virtual network operator (MVNO).

The French mobile market has only just started to emerge from a ruinous price war that has seen the launch of low-cost brands such as Orange's Sosh and Bouygues Telecom's B&YOU to compete with the more competitive tariffs launched by Iliad's Free Mobile.

French regulator Arcep reported recently that although prices dropped very rapidly between mid-2012 and spring 2013, the rate of decline has slowed considerably since then.

For more:
- see this Reuters article
- see this Les Echos article (sub. req., in French)

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