Earnings: France Telecom Net Profit Up 41 Percent, Triples Mobile Broadband Customer Base

Pan-European telco France Telecom reported a 41 percent rise in net profit for the first half of the year, on the back of a lower tax bill and a rise in broadband subscriptions, particularly in its home market; net income was 3.31 billion euros ($4.5 billion) compared to 2.35 billion euros a year ago.

Mobile broadband on the rise, but ARPU falling: In the last year Orange tripled its number of mobile broadband subscribers to a total of 8.94 million. The company currently has some 60 channels available on directOrange, its mobile TV service. Mobile revenues were up five percent to 14.1 billion euros, largely due to operations in emerging markets–specifically Poland, Egypt and Romania–and to recovery in Spain and the U.K. In total, the mobile units added 2.44 million mobile customers. Annual ARPUs generally fell across its subsidiaries: in the UK, to £258 ($525) from £261; in France, to 403 euros from 417 euros; and in Spain, to 301 euros from 307. But revenue from data services in the top markets of the UK and France are growing by around 11 percent, driven largely by non-messaging revenues.

Broadband service “significantly” offsetting declines in traditional telephony, but less than one-fifth of IPTV-enabled homes are actually subscribing to television services. Revenues from FranceTel’s “Home Communication Services” were 11.168 billion euros for the first half, down 0.5 percent versus the first half of 2006. Consumer ADSL subscribers in Europe were 10.524 million at June 30, 2007, growing by 23.1 percent over the last year. There are some 5.216 million Liveboxes installed (this is FranceTel’s all-in-one ADSL wireless router, VoIP box, and IPTV receiver), but only 872,000 people using the livebox have opted for TV subscriptions. The bulk of FranceTel’s success has been in its home market, where it has 837,000 ADSL television subscribers, a three-fold increase since last year, and reports 938,000 paying VOD downloads in the first half of 2007.
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