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| Free Mobile: Paris cloud, Bottoms-Up design, LCHV profit |
| Written by Dave Burstein |
| Friday, 27 January 2012 04:54 |
 Xavier Neil's 20 euro ($27) unlimited voice, data, and SMS deal is drawing a million customers a week to Free Mobile. He's changing the mobile world by selling at half the price of any major operator in the U.S., France, or Canada. It's not a gimmick. Xavi understands that wireless costs per minute go down dramatically with volume. Free's low cost, high volume model will net half a billion a year if he runs it well. High cost, low volume carriers like Stephane Richard's France Telecom can bluster but that won't be enough. Brian Williamson of Plum Consulting has a good look at wireless costs that suggests Free Mobile will do very well. Every honest official is thinking how to copy France. Every operator in the world is scared they will succeed. Every investment analyst is trying to decide which carriers are vulnerable and need to be downgraded. Xavi's trump card is that his "Bottoms-up" network design is years ahead of almost everyone else. He has 5M WiFi and femtocells to serve his mobile customers. Paris is now a Free WiFi cloud. Jennie, I and iPad had a wonderful two weeks in Paris in September. We rented an apartment in the Marais with Free DSL that came with WiFi. Everywhere we went, including Chartres, we could log on to Free WiFi, WiFi and femtos aren't "tower offload" in the Free network design but are the primary connection. Less than half the traffic will ultimately go to the towers, saving both construction and spectrum. Everyone including AT&T and China Mobile has been talking for several years about building networks "Bottoms-up." Xavi revolutionized the Internet once with the 20 euro triple play. He�s about to do it again to mobile. |