Merged SFR-Neuf Cegetel likely to up FTTH investment (France)Neuf Cegetel eyes Alice, strikes deal with Numericable to hasten FTTH coverage; launches in-house multiplayer online game.
Neuf Cegetel may be waiting for its principal shareholder SFR to take it over sometime between May and October this year, but not idly so.
France’s second largest fixed operator today repeated its interest in acquiring Telecom Italia’s subscale ISP Alice, which is currently up for sale, and said it will bolster its three-year, €300 million fibre-to-the-home (FTTH) network build through a wholesale fibre access deal with French cable operator Numericable.
Initially Neuf Cegetel will lease 140,000 Numericable fibre lines in Paris and an unnamed provincial town. It will use Numericable’s fibre to reach the foot of apartment buildings, after which it will install fibre vertically within the apartment block.
“We want fibre end to end, not the coax… if it works we could [go] further,” said Jacques Veyrat, CEO of Neuf Cegetel, speaking at a press conference on Tuesday.
In addition, if the SFR-Neuf Cegetel merger goes ahead this year as planned, the new entity is likely to step up FTTH investment in a bid to compete with France Telecom’s Orange.
“One of the big endgames for SFR is to prevent Orange getting too far ahead [on fibre]. Even if Orange doesn’t say it very loudly… given what they have in the ground they can go faster than us. I hope the [merger] procedure is as short as possible… that would mean an acceleration as of early 2009, said Veyrat. “We are all aware that the game is being played now… it’s becoming serious and we mustn’t hang about.”
Like Orange, Neuf Cegetel is developing its own content to fill DSL and fibre networks and complement its existing TV and video on demand services, for which it had 750,000 customers at the end of 2007.
This month the company will launch an in-house multiplayer online game, which will be aimed at both its own customers and those of other ISPs. The game will be free to download, but subject to a monthly subscription fee of under €10, with Neuf Cegetel customers paying a lower rate than those of other ISPs.
The company, which co-developed the game with game developer F4, is in discussions to licence it to other European operators, according to Michel Paulin, COO of Neuf Cegetel.
In addition Neuf Cegetel announced it has revamped its video on demand service to offer 3,500 films to which it has acquired the distribution rights.
Residential data services made up 38% of the company’s €720 million earnings in 2007, with residential voice representing 9%, enterprise 30% and wholesale 23% of the remainder. The company’s ARPU stood at €36 at the end of the fourth quarter.
Jacques Veyrat also announced Tuesday that he intends to leave the company once the SFR takeover is completed. Michel Paulin, however, said he “hopes to have a major role in the new group.”
