While the old copper network is due to close in 2030, Orange is discreetly increasing the unbundling price. An increase that operators could pass on to the price of their ADSL packages, which Free categorically refuses.

While the old copper network is due to close in 2030, Orange is discreetly increasing the unbundling price. An increase that operators could pass on to the price of their ADSL packages, which Free categorically refuses.

What if, at a time when fiber is becoming the standard for fixed Internet connection in France, ADSL subscribers are penalized by increasing the price of their package? As curious as it may seem, this hypothesis could well materialize in the coming weeks, following the authorization that the Regulatory Authority for Electronic Communications, Posts and Press Distribution (Arcep) has granted to Orange to increase the “rent” of “unbundling”…

Copper network: an aging and costly infrastructure

To fully understand what is likely to happen, you should know that ADSL is based on the traditional telephone network, which is commonly called “copper network”, because it is essentially made up of electric cables. Originally designed to transport the voice in the form of an analog signal, it was diverted from this unique original vocation by ADSL, a particularly clever technology allowing digital information to be transported over simple telephone lines – which did not have were intended for this use. And it is this technology that enabled the rapid development of broadband in France from the 2000s, without having to rebuild a new physical network to serve individuals, all already connected to the telephone.

But times change and technologies evolve. Having reached the end of its physical possibilities, copper and ADSL are gradually giving way in homes to fiber optics, which are more modern and more efficient, with much higher speeds, much better suited to current uses of the digital Internet, especially streaming video. Having become particularly costly to maintain, the aging and fragile telephone network will thus bow out in a few years. Its final dismantling is scheduled for 2030, the time to make the transition in areas where fiber is not yet available and to remove the thousands of kilometers of cables deployed on the territory. The sense of history, therefore.

What’s stuck then, and which is raising the tension between Orange and the other telecom operators? Unbundling. You should know, in fact, that it was France Telecom – the former name of Orange – which, in the wake of the PPTs, built this telephone network during a good part of the 20th century.^e century, in order to give telephone access to all citizens in France. And who still owns it? However, if communications between the NRAs – the connection nodes – are privatized by other operators (Free, SFR, etc.), the section of cable that connects each subscriber to his telephone exchange is exclusively in the hands of Orange , which maintains it. And to be able to directly connect their subscribers to their equipment, the operators rent this section, which is called “local loop”, by paying Orange a monthly rent, corresponding to the famous unbundling. A flat rate, the amount of which is set by Arcep, and which allows Orage to maintain the network

But if a gradual closure of the copper network is planned, the costs of its operation weigh heavily on Orange, which has therefore asked the telecoms policeman for an increase in the unbundling tariff in order to cover the maintenance costs of the network – which have caused it 130 million euros in losses in 2022. However, as reported The echoes, Arcep announced its intention to increase it by 39 cents per month. Also, for an ADSL package sold around 30 euros per month, Free, SFR and Bouygues Telecom will have to pay 10.04 euros to Orange, against 9.65 euros previously. Consequently, either the operators do not change the price of ADSL subscriptions and make less profit, or they increase them so that this increase is paid for by the users – who will not have a better quality of network for all that. Strangely, we suspect their choice…

ADSL: an increase in the unbundling rate that is debating

This situation is far from pleasing everyone, starting with Xavier Niel, the boss of Free, who made a rather noticeable exit during his hearing before the Senate Economic Affairs Committee on March 22. He accused Arcep of making a “financial transfer” towards Orange – a gift in short – by considering a measure that would allow the incumbent to raise the prices of unbundling for the transition from the end of the copper network. He denounced “an Arcep that sets in front of Orange” and criticized Christel Heydemann, the latter’s chief executive, for referring to his “deal with Arcep”. Moreover, he would have planned “an overextended schedule for the project, as well as “conditions envisaged for the cessation of copper which are not satisfactorys“.

Indeed, for Xavier Niel, 2030 is far too distant a deadline, especially since third-party operators must remunerate the incumbent operator for ADSL customers, who are now in the minority. He felt that it is possible to speed up the process considerably by forcing users, which he calls “irreducible”, to adopt fiber. A statement that was not at all to the liking of the Association of Cable Cities (Avicca), which responded to it in a blog post – Xavier Niel is not named there, but the turn of the sentences leaves little doubt. According to her, the reason for the slow dismantling of the copper network is simple: no city in France is yet 100% covered by fiber. Indeed, 0% of municipalities are “fully covered (or almost) in optical fiber by private operators in very dense areas”, 11% are completely (or almost) covered by fiber optics by private operators in the AMII zone, and 25% are completely (or almost) covered by fiber optics by local authorities in the public initiative zone. In Paris, for example, there are still 55,551 premises to be connected, compared to 109,545 in Marseille or 39,347 in Toulouse. It is therefore impossible to withdraw the ADSL offers there without transition.

End of ADSL: prices that are likely to soar during the transition

But this is not the only source of discord between Xavier Niel and the regulatory authorities. Indeed, Senator LR from Ain Patrick Chaize asked him about his aggressive pricing policy and whether it was tenable, given that Free is the only operator not to have officially increased the prices of its packages and subscriptions for compensate for the increase in energy costs – on the other hand, it has discreetly increased the price of the Booster option offered on its package to €2 (see our article). “Now I’m walking on the moon! Are you telling me ‘raise your prices’?”hallucinated the boss of the Iliad group, before replying vehemently that Free’s extremely low prices were one of its assets and pointing out that Free was the only operator not to increase its prices when its customers switch to fiber, unlike to Orange, which offers ADSL 10 euros cheaper than fiber – enough to discourage more than one from making the transition.

So, real anger like a com stunt? It is worth pointing out that by opposing other operators and defending an aggressive pricing policy, Xavier Niel draws media attention to himself and highlights Free’s main advantage: attractive prices for consumers. Still, this interview highlights the tensions between telecom operators in France and the difficulty of finding a balance between competitive prices for consumers and the profitability of operations. On the Orange side, the increase in the unbundling price would push its competitors to reduce their fleet of ADSL subscribers more quickly to accelerate the transition to fiber. And he obviously intends to go further since he presented in mid-February its “Lead the future” strategic plan, where he indicated that he wanted to increase the unbundling rate by 2 euros in the coming years. The prices of ADSL subscriptions could therefore rise dramatically…