Disruption is oft-mentioned in telecoms but usually the thing described is not a 'real' disruption (like a major rail accident, for instance) but rather a competitive annoyance. France's Free Mobile, however, is living up to the label: not only are the three mobile incumbents squirming but even the former 'disrupters' - the French MVNOs - are feeling the chill. By Ian Scales
Following the launch of its cut-price services Free Mobile has managed to upset its fellow market-disrupters, the French MVNOs, by publishing wholesale rates for minutes and texts, which they claim are above the prices being charged to Free's retail customers. French regulator, Arcep, is being urged to intervene.
The MVNOs say that the terms of Free's license mandate it to offer favourable wholesale rates to other players. Far from doing that, Free's rates have been constructed to make it impossible for MVNOs to compete with it on price (at least through becoming a Free MVNO), they claim.
While the per usage charges seem reasonable - €0.05 per minute for voice calls, €0.01 per SMS and €0.05 per broadband megabyte - MVNOs have to fork out for hefty 'pay monthly' charges: €1 million a month for wholesale access and €2 per active SIM per month, in addition to a €2 million launch fee.
The arrival of Free, and the competitive response to it, has also brought to the surface the vexed problem of so-called 'unlimited' offers.
In France, as elsewhere, regulators and consumer groups froth at the mouth over unlimited x (for broadband, calls or texts) which turn out to be underpinned by a fair usage clause or a straight cap and therefore, if you want to be pedantic about it, aren't unlimited at all.
But in many cases what's actually being sold is a service designed for a sane human being. For instance, according to French consumer group UFC-Que Choisir, one of the French MVNOs - La Poste Mobile - is guilty of limiting "unlimited" calls to 200 hours per month... 'hours!'. According to my calculations that's 6.5 hours a day, far more time than any sane person should have a phone clamped to the side of their head. If that's a problem they need to get out more!
Back in the real world, 'unlimited' offers have very high caps to reduce the risk of the service being resold in some way, or being used to refile calls or act as tethered gateways for a corporate network (for instance).
Clearly what's needed is a replacement for the word "unlimited" which gets across the intent of the service offer, implies that a cap is needed to weed out abuse, but suggests an attractive, no-strings deal - all without offending the regulator.
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