France Tele Hits Hotel Hotspots

France Telecom move could make life hard for the tiddlers in this market

March 13, 2003

2 Min Read
France Tele Hits Hotel Hotspots

France Telecom SA (NYSE: FTE) has become the latest European incumbent operator to push the rollout of public wireless LAN networks by announcing plans, via its national Orange France (Paris: OGE) subsidiary, to launch 900 hotspots in Accor-owned, business-class hotels throughout its home nation (see French Hotspotting Hotels).

According to a France Telecom spokeshomme, 300 hotels will be equipped by the end of the year, with business users the core target market. The deployment timetable calls for 50 hotels to be networked by June 30.

Its decision to roll out hotspot networks is in keeping with analysts' belief that European service providers will dominate wireless LAN in this region, rather than aggregators or specialized providers (see Hotspots: Getting Hotter? and Euro Hotspots in Growth Spurt). This is France Telecom's second wireless LAN announcement recently (see FT Outlines WLAN Plans).

While carrier rivals SFR and Bouygues Telecom remain tight-lipped over their own future hotspot plans, France Telecom’s inroads into this market could spell problems for smaller players in the region, including ADP Telecom, Wifispot, Wifix, and Netinary [ed. note: can never remember if a netinary has one hump or two...].

“A smaller player in this market, dependent purely on wireless LAN as a business, is going to find it very difficult to succeed,” prophesies Evelien Wiggers, senior research analyst at IDC. “Mobile operators are going to drive the wireless LAN hotspot market, as they already have the subscriber base.” She adds that ADP Telecom’s strong presence in French airports could mark it out as a prime candidate for possible future acquisition.

If rollout remains on track, the hotel project will make La Grande Orange the largest wireless LAN provider in France by the end of 2003. Evelien Wiggers expects the carrier to concentrate efforts solely on its home country for now, rather than going on a European rampage -- after the fashion of Swisscom AG (NYSE: SCM) (see Swisscom Buys a Bevy of PWLAN) -- and to increase market share by arranging roaming agreements with other hotspot providers.

In geographic terms, France is widely assumed to be in Europe, just north of Spain. It's alleged to be a nice place to go on one's holidays.

— Justin Springham, Senior Editor, Europe, Unstrung

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