December 10, 2013 / 12:10 PM / in 6 years

Iliad steps up French mobile broadband price war

PARIS, Dec 10 (Reuters) - French low-cost telecoms operator Iliad said on Tuesday it would include 4G broadband service in its cheapest monthly package, stepping up its assault against bigger rivals rolling out the superfast technology at higher prices.

Iliad opened a new front in the mobile price war last week when it said it would add 4G to its 19.99-euro ($27.43) monthly package at no extra cost, prompting Bouygues Telecom to retaliate by upgrading all of its 3G customers to 4G.

Now, Iliad said its 2-euro monthly Free Mobile package will feature 4G at no extra cost for users downloading up to 50 megabytes of data. Beyond that the service will cost 5 euro cents per megabyte, the company said in a statement.

In comparison, its 19.99-euro mobile package offers 4G for up to 20 gigabytes, or 400 times more downloading capacity.

The move heaps more pressure on France’s leading telecoms operators, Orange, Vivendi’s SFR and Bouygues, which had hoped their newly built fourth-generation networks would command higher prices and help restore profits hit by the emergence of Iliad.

Since Free Mobile joined the market less than two years ago, mobile prices in France have fallen by 11 percent in 2012 and a further 8 to 10 percent this year. Free Mobile took a 10 percent market share in the process.

Shares in Iliad were up 1.1 percent at 1157 GMT. Shares in Bouygues and Vivendi were 0.75 percent and 0.94 percent higher, respectively, while Orange shares were down 0.47 percent.

Iliad is still in the process of building its mobile network across France, but it chose equipment made by Nokia’s NSN that runs both 3G and 4G simultaneously. It said last week that, as of Dec. 1, it had 700 mobile antennas capable of handling 4G speeds.

Orange had 3,439 activated 4G antennas at Nov. 1, SFR had 718 and Bouygues 4,655, according to data provided by French regulators. ($1 = 0.7289 euros) (Reporting by Natalie Huet; Editing by Louise Heavens)

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