French Provider Free Could Buy US Branch of T-Mobile

Guybrush_T (980074) writes Iliad, the parent company of Free, confirmed today having made an offer to buy 56% of the U.S. branch of T-Mobile. This could be very good news for the U.S., since the provider reduced significantly the average price of mobile plans in France since they entered the mobile market two years ago. Their disruptive strategy, featuring an all-inclusive €20/month plan and a €2/month plan gathered 11% of the French market in only two years and lowered the price of plans by a factor of 5 to 10.

Comments

Um... good for whom in the US?

[gwstuff]

Do you mean the US shareholders of T-Mobile? The CEOs? The Execs?

You couldn't possibly mean good for the US consumer... or did you? It's a bit awkward this. You must excuse me, you see we in the US have never really had any experience with that sort of thing - a company doing something that's good for the consumer... wow, I wonder how that feels like. Is that like when a Comcast sales rep signs you up for a promotion that actually costs you money in the long run, but gives you a refund when you spend hours on the phone, in effect being all nice and not ripping you off?

Re:Um... good for whom in the US?

[Meeni]

20 euros is inclusive of taxes. France taxes are not super heavy, but still on the upper side, and I'd bet US taxes are lower overall.

When I lived in France I had Free. Excellent service, very disruptive market strategy. I'm very excited with the news. I'd switch in an eyelash.

Re: Um... good for whom in the US?

[Anonymous Coward]

Un France (but not exclusively), the expectation and the law is that the advertised price is the price that you will pay, period. Even restaurants have service included in the price, tipping is no longer required, expected, nor is it in the habits of locals anymore.
Consumers are well protected overall by legislation, anything aiming to deceive them is considered scandalous and fixed in the following law.
It's not perfect, but it certainly makes day-to-day life easier.

Re: Um... good for whom in the US?

[christophe]

French Free customer here.

The expectation is that the advertised price is the price that you will pay, right, and that's usually the case. But "advertised" means sometimes that the subscrition is N euros, and it is not clear (or in very small letters) that the compulsory routeur is M euros, and other options are X eurs, or that the price will double after 6 months, and so on. Our main provider (Orange, formerly France Telecom) and the others are very fond of this game. But Free does not, the 20 euros is really all included, no surprise.

As for tipping, it still exists in France, on a smaller scale. I often let 1 euro on the table if I'm pleased by the service.

Rejected!

[Anonymous Coward]

According to TmoNews, this was rejected.

http://www.tmonews.com/2014/07/french-telecoms-company-iliad-makes-bid-for-t-mobile-us/

Re:Rejected!

[ArmoredDragon]

I bet I know why they rejected it: If they accept it, then they'll miss out on the $2 billion Sprint will have to pay them when Club Fed rejects the takeover.

However after that takeover fails (you already know it will,) they pass go and collect $2 billion, and then they can consider Iliad's bid again.

Perspective

[Anonymous Coward]

As a French, I'm not sure that I like that idea, Free spending lots of money to buy marketshare in the US instead of enhancing their network in France.

AOL tried to do the inverse a while ago. They bragged that they were leaders in 'America', about to obliterate French providers. It ended awfully for them.
Free (and SFR, others) killed them.

Re:Perspective

[Salgat]

They are doing it to increase revenue/future profit. This is a long term strategy, don't be fooled into thinking they are doing this to be charitable. I think it's great because it means they will have more money to invest in infrastructure in the future.

Please NO

[markdavis]

Please everyone just leave T-Mobile alone. They are doing great the last few years. I don't want them ruined by Sprint or Iliad or Dish or anyone else!

Competition is good and T-Mobile is proof of it. Even if you don't use T-Mobile and never will, you have STILL BENEFITED from many of the things they have done lately which have been forcing other carriers to make changes.

Just today:
"T-Mobile posted its second quarter earnings today, and the carrier is continuing momentum as far as customer acquisition is concerned. The Uncarrier managed to add an additional 1.5 million customers in the second quarter, which makes it the fifth consecutive quarter in which the carrier added more than 1 million subscribers. The influx of new customers meant that T-Mobile's revenue rose by 15.4 percent to $7.2 billion. 50 million total subscribers now."

Re:Please NO

[synaptik]

Please everyone just leave T-Mobile alone. They are doing great the last few years.

I agree, but T-Mobile is doing great because they don't *want* to be left alone. They are being so aggressive with their pricing because they want to be targetted for a buy-out. Their parent company, Deutsche Telekom AG, has made it clear that they want out of that business.

Re:As a T-mobile subscriber...

[Richy_T]

Good news... For anyone who lives in a city with coverage and never travels.

Re:As a T-mobile subscriber...

[schnell]

it won't matter which carrier you have, since eventually you'll be able to roam on any network.

Nope, sorry. For three reasons:

1. 1.) VoLTE on one carrier is not necessarily compatible with VoLTE on another carrier. VoLTE is not plain VoIP - like Skype etc. - where it is a pure "over the top" Layer 7 application that any IP network should support. It is built at a much lower layer in the OSI stack, and each carrier's implementation will be optimized for their own network and may not be compatible with another carrier's.
2. 2.) To roam on "any network" (at least in the US) requires your phone to be able to access all the different LTE bands licensed to different carriers. Most phones sold in the US don't because it costs extra money to support the frequency bands of multiple carriers which is pointless when 95% of customers will use the phone for its two-year lifetime on the carrier that they bought it from
3. 3.) Also - to roam onto another network, by the way that GSM cellular technology works, your home carrier must have a roaming agreement with the "other" carrier. Generally speaking, the big US carriers have roaming agreements for international use and for remote rural use, but not in domestic areas where they have their own networks. The simple explanation is that if you lose your Verizon signal for a second and your phone tries to go roam onto T-Mobile, that costs VZ a lot of money.... whereas in that area it's more likely that you will get a VZ tower back within a few minutes and not cost them any roaming fees if you didn't attach to a roaming network. TL;DR - somebody will always pay more if you are using a network other than your "home" carrier, and that somebody will end up being you - at a rate that will make it economically unfeasible.

Lastly, if you thought that VoLTE was going to mean that you could just use any given carrier at your convenience, I'm sorry but that's just not how cellular works. In the mobile (GSM and its successor technologies like LTE) world, you have a "home" carrier (who gave you your SIM and sends you your monthly bill) and you will always use your home carrier whenever possible because it's less expensive for them. To use another carrier - even if they have better coverage in a certain area, and your device has the other carrier's frequencies enabled - means that your home carrier will absorb roaming charges and they will pass those along to you. With a markup. So it makes no economic sense for you or your carrier to just let you use the network that has the strongest signal in any given area... or if they do, be prepared to pay out the frickin' wazoo for every time you surf the web on a carrier that isn't your home provider.

Re:As a T-mobile subscriber...

[cbhacking]

The west coast in general has good TMo coverage (all the cities including the little ones, every time I checked when driving the I-5 from Seattle to SF, and the local ski areas) but the only other place I've checked was in DC (where it was fine). However, I scarcely even consider that "travel". For *REAL* travel, TMo is by far the best carrier option. I spent a month in Europe earlier this year. Six countries, and I had service everywhere in every one of them including on the Swiss ski slopes. I sent/received well over a thousand texts and a number of MMS, streamed music all day (at 128Kbps, that adds up fast), did email and web browsing and so forth, and Skyped with friends and family. I also received several calls which I let go to voicemail, then checked the voicemails. All on my normal US T-Mobile SIM card.

Extra cost for all that stuff while abroad? $0.00.

It would have cost something to use voice calls over the cellular network, but with things like Skype or Google Voice (plus the free and unlimited - though not super-fast - data), that was never needed. T-Mo's "WiFi Calling" feature also lets you make or receive calls, while overseas, without any charge as long as you're on WiFi. I'm planning to visit Indonesia soon, and T-Mobile says I'll be covered there too. It's a *fantastic* carrier for people who travel.

Don't forget the Internet

[Lorens]

Before launching their mobile telephony offering and forcing the previous oligopoly to slash their prices, Free did the same with ADSL Internet (and ISTR with dialup before that). I pay something like USD 45/month for:

- uncapped broadband with static IP and valid rDNS (living in an area well covered by DSL that is about 17 Mbps down, but if/when their fiber gets here I'll pay the same price for 1 Gbps!)

- plus unlimited telephone to fixed and mobiles in France, to fixed in some 100 other countries and to mobile in some countries, relatively low rates otherwise

- a SIM card with unlimited SMS, 50Gb 3G/4G data/month, 2 hours phone (the unlimited version would set me back some USD 22/month more) and extremely competitive rates for anything not included

- Some 600 television channels (some of which you have to pay extra for, sure), with timeshifting, pay-per-view video on demand, and free replay (usually the last week of popular series, depending on the channel)

- an ADSL box "Freebox", extremely well thought out (hello Rani) with a really excellent user interface (web browser, games, what have you), a 4-port gigabit switch, a Blu-Ray reader, a 250 GB disk that can be used as a NAS and for recording television programs

- lots of techie goodies (IPv6 if I want it, messages left on my answering machine can be forwarded to an e-mail address, I can force certain MACs to an IP so that I have the same IP whether connected by WiFi or Ethernet, and, and, and, isn't there a length limit on comments here?)

I'm looking at moving to the US (like SF or NY, https://www.linkedin.com/pub/l... ), so I read the Comcast horror stories with interest. In comparison, I have called Free tech support once in six years, after a storm killed my Freebox. It was replaced (without charge I believe), and nobody even hinted that I might like to buy anything more. If they manage to buy a US provider, no question, I'll be their client.

This might just be bad news.

[christophe]

Another French here. I don't think the higher prices that we paid before Free appeared were so good for investments. On the contrary: since Free appeared, Orange and the 2 other providers pushed and marketed heavily the "4G" (LTE), that Free does not offer. They had to compete on quality because they could not cope with the price. In 2005 (Free was not a mobile provider yet) they were together sentenced to 535 million euros due to an unlawful agreement. The market forces did not apply anymore, a big problem on the long term. We did not destroy the France Telecom monopoly in order to have a private oligopoly. Private firms will not invest on hardware if they can avoid it. Either they do it to provide better product or service (and the price will be higher), or they are forced by law.

Re:Consumers

[fnj]

You're completely right. It's your IQ being over 70 that makes the surrender joke not funny.

If I may be permitted to demur, I don't think that's got it either. For me it's history of a longer range than a few years that makes it not as funny as it otherwise might be. The way the American Revolution would have been unquestionably lost without the aid of the French. The way the dear sweet young generation of France reddened the soil of their homeland with their blood to save it in the Great War. The way young and old went underground full of fight when the Nation was overwhelmed in 1940.

All that just sharpens the contrast with today, now that we see the nation of France, along with so many others, surrender to the evil ravening islamic mob in the streets of their own capital.