The smoke came out this Tuesday, March 28. Arcep has delivered its verdict. The telecoms policeman has decided to increase the unbundling rate. That is to say the price paid by SFR, Bouygues Telecom and Free to access the Orange copper network, used for ADSL and fixed telephony. From April 1, alternative operators will have to pay 10.04 euros per line and per month, against 9.65 euros previously.
This is a success for Orange, which had started a legal tussle with the telecoms regulatory authority to obtain an increase in this unbundling rate. Hearing by the Senate Christel Heydemann, general manager of the incumbent operator, had advanced his arguments. While the number of ADSL subscribers continues to grow – there are now fewer of them than converts to optical fiber – the costs associated with maintaining the copper network continue to increase.
With regard to an aging network, in service since the 1970s, the costs of its maintenance have, it specifies, increased by 37% between 2018 and 2021 to reach 500 million euros per year. Despite the cash flow from the unbundling – the 6 million copper lines from Free, Bouygues Telecom and SFR customers – the operation would be loss-making. Orange would have recorded 130 million euros in losses last year.
Compensate for the rise in Ifer
Orange had also justified its request to Arcep, which dates back to October 10, by the expected increase in the amount of Ifer. Collected for the benefit of local authorities, this flat-rate tax on network companies is indexed to the number of antennas and frequencies emitted. With the deployment of the 5G network, it is expected to increase sharply, rising from 270 million euros in 2022 to 500 million in 2027.
With these 39 cents increase in the unbundling price, Orange is still far from its claims. The operator was counting on an increase of 2 euros in mid-February on the occasion of the presentation of its new strategic plan. However, new room for maneuver should be granted to it. On April 3, Arcep will complete a public consultation on the evolution of regulation for the period 2024-2028.
The Authority makes a future increase in the unbundling tariff conditional on the deployment of fibre. In fiber areas for a long time and where the copper network is commercially closed, Orange will no longer be subject to the price cap and will be able to charge a “non-excessive price” to competing operators who use its network.
Alternative operators, turkeys stuffing?
These good provisions with regard to Orange are likely to fuel the anger of these alternative operators. Not only will they also suffer from the rise in Ifer, but they will have to put more money in their pockets to access the latter’s copper network.
In a recent hearing in the Senate, Xavier Niel did not have enough harsh words to denounce the “situational rent” constituted by the unbundling tariff collected by the incumbent operator. Allowing deregulation would, in his view, be a mistake. “None of the countries in Europe has increased its unbundling rates,” he said.
While the boss of Free pleads to tighten the timetable for the closure of the copper network, this deregulation would encourage, on the contrary, Orange to maintain this aging infrastructure longer. Gradual, the technical extinction of the copper network will be staggered until 2030 with an end to the subscription of commercial offers in ADSL from January 2026.