At the end of 2020, Brussels validated the acquisition of Covage by SFR under certain conditions. Indeed, in order to avoid competition problems, the operator with the red square had to sell part of its networks. Altitude Infra and Axione had expressed their interest and had positioned themselves to acquire all the networks concerned.

In a joint press release, Altitude Infra, which manages 19 RIPs and claims to have deployed 1 million outlets, and Xp Fibre, the entity created by the merger between SFR FTTH and Covage, with 7 million outlets deployed, announced that they had entered into exclusive negotiations for the full acquisition of the assets. The transaction is expected to be finalised in the second half of 2021, following approval by the European Commission.

The 25 networks concerned correspond to Covage's fibre optic local loop activity in the Public Initiative Networks. This represents 95% of the operator's FttO (Fibre to the Office) activity. Among them, 15 Covage subsidiaries active almost exclusively on the wholesale market for capacity services on BLOD (Dedicated Optical Local Loop) and 10 Covage subsidiaries active marginally on the wholesale market for capacity services on BLOD and which also deploy FttH networks.

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Source : Univers Freebox

Last November, the European Commission approved the acquisition of Covage by SFR FttH. The company is now called Xp Fibre and has a portfolio of 7 million fiber optic connections. It includes 24 Public Initiative Networks (PINs), operated under public service delegations (PSDs); five AMEL zones and two proprietary networks; and 2.6 million outlets in AMII zones.

Its role remains broadly the same as that of SFR FttH, i.e., network deployment, operation and marketing of its own outlets, or through public partnerships, depending on the areas to be equipped.

In detail, SFR FttH already had 5.5 million outlets throughout France, notably through 16 public service partnerships, three AMEL zones and the AMII zone. With this acquisition, Xp Fibre now has 8 DSPs and 4 proprietary networks (including two AMEL).

Each of the deployment areas will benefit from a fiber optic network open to all commercial operators, Xp Fibre being an infrastructure operator. The general public, businesses and local authorities will all be able to subscribe to the access provider of their choice.

"The new entity, made up of the assets of SFR FttH and those resulting from the acquisition of Covage, gives rise to a new, even more ambitious player in the field of fiber for territories and a key player for commercial operators," commented Lionel Recorbet, President of Xp Fibre.

The capital of the new entity remains composed of the Canadian fund OMERS (one of the main defined benefit pension plans in Canada), Altice France and the infrastructure funds of the Axa and Allianz groups, as was that of SFR FttH.

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Source : Clubic

In July 2020, Free approached the Arcep, asking it to specify the conditions of access for market players to SFR's FttH network in less dense private initiative zones (AMII). Iliad's subsidiary demanded that SFR's tariffs for access to the terminal part of its network be regulated, limiting any increase to the indexation provided for in the mutualization contract between the two operators and making any change beyond this scale subject to the signature of a rider "negotiated in good faith".

This is a hot topic, because already last April, the Arcep said it was ready to put the "points on the i's" in the issue of the increase in connection rates to SFR's fiber network in private areas. In fact, the Authority had already demanded from the mark with the red square the cancellation of the increase in its tariffs in force since the beginning of the year 2020 after having been seized by Bouygues Telecom last winter.

Free, which therefore demanded the revision of the co-financing rates demanded by SFR, in the AMII zone, so that they do not exceed €5.12 per line and per month (or €513.6 per line for the non-recurring rate) for a co-financing up to 20%.

This request was accepted by Arcep, which asked SFR to adjust its tariffs in the AMII zones but also in the AMEL zones. The Gendarme des Télécoms justifies this position by stating that SFR's infrastructure branch "has not produced any specific elements that would allow it to understand its costs" and believes that increases in access tariffs must "be justified by cost elements".

As in the dispute between Bouygues Telecom and SFR, the Arcep has enjoined the brand with the red square to return to its co-financing rates applied before February 2020. However, it has the possibility of adjusting them in a much more modest manner by means of an amendment. This decision was eagerly awaited by certain players in the sector, for whom the survival of the principle of sharing the terminal part of the Orange and SFR fiber networks, in force since 2008, was at stake.

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Source : ZDNet

Altice, via its SFR FTTH branch, entered into exclusive negotiations a year ago to acquire 100% of the wholesale operator Covage.

The Association of Alternative Telecom Operators was quick to express its concern, because this merger was not "without raising profound questions about the preservation of an already fragile competitive intensity in the business and local authority market".

The European Commission "has cleared under the EU Merger Regulation the proposed acquisition of Covage by SFR FTTH, a company jointly controlled by Altice, Allianz and Omers. The clearance is subject to full compliance with a series of commitments offered".

Two commitments are made by SFR FTTH:

• "The sale to a suitable purchaser of 25 subsidiaries and assets corresponding to Covage's "optical local loop"" business in the territory of 30 public institutions. These subsidiaries and assets consist of FttO networks and represent in total approximately 95% of Covage's FttO business.
• "The offer of a transitional service contract, including access to all assets and services required to operate the divested business under competitive conditions for a period of time allowing SFR FTTH to become fully independent".

In conclusion, the Commission states that "the final commitments address the competition concerns identified by the Commission with respect to the acquisition of Covage by SFR FTTH and have been substantially improved following comments provided by market participants. The Commission has therefore concluded that the proposed transaction, as modified by the commitments, no longer raises competition concerns".

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Source : Next Inpact

After ten months of proceedings, the Arcep ruled in favor of Bouygues Telecom regarding the wholesale prices charged by SFR FTTH to other national or regional operators. The latter are grafting themselves onto SFR's optical fiber network in the countryside in order to be able to offer this technology in areas where their own networks are less developed.

The Arcep was seized last January by Martin Bouygues' operator, after a price increase on the SFR side. Indeed, to access a "package" of SFR lines, operators had to pay 5.80 euros per line and per month, compared to 5.48 euros for Orange. Line rental prices had increased to 16.40 euros per month and per line.

SFR FTTH was able to increase its prices because, when it comes to optical fiber, only Orange's rates are regulated. For its part, Bouygues Telecom demanded two things: a return to the rates in effect before the February 1, 2020 increase and a reduction in line rental prices, with a range of 12.20 euros to 13.20 euros.

The regulator ruled in its favor on these two issues. SFR will therefore have to offer Bouygues Telecom an amendment to the contract to restore the old rates within one month. As regards line rental, SFR is required to propose a new tariff to Bouygues not to exceed 13.20 euros per month and per line.

This is a real setback for SFR, which by the end of 2018 had sold half of its fiber optic network in the three-fund campaigns. The latter had paid a very high price for this asset, no doubt enticed by the promise of high and long-term rental revenues.

But two years later, the operator had to lower its prices. In addition to this, Free has also filed a complaint with the Arcep on the same subject.

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Source : Les Échos