An analysis of the disruptive impact of the entry of Free Mobile into the French mobile telecommunications market

Michel Berne (michel.berne@telecom-em.eu), Pierre Vialle (pierre.vialle@imt-bs.eu) and Jason Whalley (jason.whalley@telecom-em.eu)
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Michel Berne: LITEM - Laboratoire en Innovation, Technologies, Economie et Management (EA 7363) - UEVE - Université d'Évry-Val-d'Essonne - IMT-BS - Institut Mines-Télécom Business School - IMT - Institut Mines-Télécom [Paris], IMT-BS - DEFI - Département Droit, Économie et Finances - TEM - Télécom Ecole de Management - IMT - Institut Mines-Télécom [Paris] - IMT-BS - Institut Mines-Télécom Business School - IMT - Institut Mines-Télécom [Paris]
Pierre Vialle: LITEM - Laboratoire en Innovation, Technologies, Economie et Management (EA 7363) - UEVE - Université d'Évry-Val-d'Essonne - IMT-BS - Institut Mines-Télécom Business School - IMT - Institut Mines-Télécom [Paris], IMT-BS - MMS - Département Management, Marketing et Stratégie - TEM - Télécom Ecole de Management - IMT - Institut Mines-Télécom [Paris] - IMT-BS - Institut Mines-Télécom Business School - IMT - Institut Mines-Télécom [Paris]
Jason Whalley: Northumbria University [Newcastle], IMT-BS - MMS - Département Management, Marketing et Stratégie - TEM - Télécom Ecole de Management - IMT - Institut Mines-Télécom [Paris] - IMT-BS - Institut Mines-Télécom Business School - IMT - Institut Mines-Télécom [Paris]

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Abstract: The issue of disruptive operators has recently gained interest among researchers and regulators. From a regulator's perspective, disruptive operators can increase competitive rivalry in markets dominated by a handful of large companies, thereby allowing consumers to obtain more benefits in terms of price and quality. Largely overlooked in this discussion has been the impact that the specific identity, complementary assets of operators, and their strategies have on the marketplace dynamics. In this paper we explore the impact that one such operator – Free Mobile – has had on the French mobile telecommunications market. Drawing on a wide range of secondary sources, our analysis finds that the entry and subsequent growth of Free Mobile has had a complex and multi-faceted impact on the market. Their growth has been at the expense of the other three mobile network operators active in the French market, while their innovative business model, which enables it to compete on the basis of low costs, has been copied by its rivals. The specific characteristics of Free Mobile and of its strategy have contributed to a significantly alteration to how competition occurs in this market. This, in turn, triggers a strong incentive for restructuring, which is actually restrained by regulatory concerns.

Keywords: France; Free Mobile; Mobile telecommunications; Disruption; Competition; Entry (search for similar items in EconPapers)
Date: 2019-04
Note: View the original document on HAL open archive server: https://hal.science/hal-02147914v1
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Published in Telecommunications Policy, 2019, 43 (3), pp.262 - 277. ⟨10.1016/j.telpol.2018.07.007⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-02147914

DOI: 10.1016/j.telpol.2018.07.007

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