{"id":80792,"date":"2020-09-22T19:43:07","date_gmt":"2020-09-22T19:43:07","guid":{"rendered":"https:\/\/www.mobileworldlive.com\/?p=297022"},"modified":"2020-09-22T19:43:07","modified_gmt":"2020-09-22T19:43:07","slug":"blog-is-iliad-set-to-become-next-european-powerhouse","status":"publish","type":"post","link":"https:\/\/itteacheritfreelance.hk\/wordpress\/index.php\/2020\/09\/22\/blog-is-iliad-set-to-become-next-european-powerhouse\/","title":{"rendered":"Blog: Is Iliad set to become next European powerhouse?"},"content":{"rendered":"

<\/p>\n

\tFrom being known as France\u2019s disruptive newcomer which instigated a long-running price war forcing the big boys to slash charges, billionaire Xavier Niel\u2019s Iliad is now starting to establish itself in the mobile sector as a major European player.<\/p>\n

This week the company struck a \u20ac3.5 billion deal, [1] including debt, to take control of Poland\u2019s Play, a move which, if it clears the relevant regulatory checks, adds 15 million subscribers to its portfolio and would see it enter a country with huge potential.<\/p>\n

Iliad\u2019s proposed push into Poland comes two years after it replicated its disruptive domestic model and took the fight to Italy\u2019s major players, launching as the country\u2019s fourth operator, where it has steadily grown its market share [2] to 8 per cent as of end-June.<\/p>\n

Indeed, Niel is renowned for going to market with aggressive price plans and effectively upsetting the status quo by undercutting the established competition.<\/p>\n

Looking back, it did exactly that in France in 2012, when it added mobile to its fixed-line offering, launching its Free brand to rival Orange, SFR and Bouygues Telecom.<\/p>\n

And six years later, it made similar strides in Italy.<\/p>\n

In its statement announcing the Play deal, Iliad explained it was attracted to the operator as both companies had a lot in common, experiencing \u201cexceptional growth\u201d over the past 15 years.<\/p>\n

It added both had been \u201cgame changers in our markets\u201d by opening access to mobile usage, describing the tie-up as a perfect strategic fit.<\/p>\n

However, there was also an indication from the French company that the deal would mark a shift away from its established underdog approach.<\/p>\n

Iliad said adding Play to its operations “cemented” its position as a pan-European mobile player, operating in three of the region’s largest markets.<\/p>\n

And to underline its point, the company said it had 41 million subscribers across those three markets, making it the sixth-largest mobile operator in Europe.<\/p>\n

Different dynamic
\nUnlike mobile entrances in France and Italy, its push into Poland represents a different dynamic for Iliad, considering it will hardly be starting from scratch.<\/p>\n

Play, with a 29 per cent market share built up since launching in 2007, is now ahead of Deutsche Telekom\u2019s local T-Mobile unit, Orange Polska and Polkomtel.<\/p>\n

Kester Mann, director for consumer and connectivity at CCS Insight also pointed out similarities between Iliad and Play, which are both known for being challenger brands based on simple pricing.<\/p>\n

But, while Iliad is indeed taking control of the country\u2019s current largest operator, it doesn\u2019t necessarily mean it won\u2019t look to shake things up.<\/p>\n

\u201cWith many household budgets strained due to the impact of Covid-19, the timing of Iliad\u2019s investment into a disruptive provider appears astute,\u201d explained Mann. \u201cPoland is a country with 38 million people, so there will be plenty of opportunity for further growth and disruption. Notably, with a broadband penetration of 55 per cent, it will see an opportunity to disrupt in this market.\u201d<\/p>\n

Mann noted Poland is somewhat different to Italy and France, particularly when it comes to consumer pricing.<\/p>\n

Play, for example, is already synonymous with value-for-money offers, so Iliad\u2019s approach in Italy is unlikely to have the same impact in Poland.<\/p>\n

Despite a heritage of low prices, Mann believes rivals in Poland will need to remain \u201con-guard\u201d.<\/p>\n

But its biggest impact could lie in a foray into the broadband market, a push it has also embarked on in Italy. [3]<\/p>\n

\u201cA move into fixed-line and likely also convergence, will probably be the biggest impact from the deal that consumers will see. It will likely use its experience from other markets to drive this strategy,\u201d added Mann.<\/p>\n

In a research note to Bloomberg, Haitong Bank analyst Konrad Ksiezopolski added if Iliad does indeed harbour convergence ambitions, more acquisitions in Poland, in particular fixed-line assets, could well be on the cards.<\/p>\n

Taking on Europe\u2019s big boys
\nThe Play acquisition comes less than a year after Niel tightened his grip on the company [4] through a \u20ac1.4 billion share buy-back, increasing his holding to 72 per cent.<\/p>\n

At the time, the move was positioned as a way to offer shareholders a way out following quarterly declines.<\/p>\n

Indeed, the Play deal has met with something of a cool reception, with Iliad\u2019s share price dropping 3 per cent immediately after it was announced.<\/p>\n

Iliad remains under pressure to invest in its networks in Italy and France, and Stephane Beyazian, an analyst at MainFirst Bank, said the \u201cadventure in Poland” was a surprise for investors who would have liked to see improvements in existing markets first.<\/p>\n

Any scepticism is, however, unlikely to deter the boss. Mann believes the company could well be targeting further growth, with any opportunity to expand or disrupt an appealing prospect.<\/p>\n

\u201cIliad is a maverick company and in Niel it has a major shareholder with deep pockets. It would be no surprise to see it make further additions to its European portfolio,\u201d he said.<\/p>\n

The company has already shown it is not afraid to enter more established markets, like Italy, or emerging ones, like Poland.<\/p>\n

Iliad has made its Polish play. The location of its next playground is anyone\u2019s guess.<\/p>\n

The editorial views expressed in this article are solely those of the author and will not necessarily reflect the views of the GSMA, its Members or Associate Members.<\/p>\n

[1] https:\/\/www.mobileworldlive.com\/featured-content\/home-banner\/iliad-targets-poland-in-latest-european-push
\n[2] https:\/\/www.mobileworldlive.com\/featured-content\/home-banner\/iliad-remains-resolute-despite-covid-19-hit
\n[3] https:\/\/www.mobileworldlive.com\/featured-content\/top-three\/iliad-targets-converged-move-in-italy
\n[4] https:\/\/www.mobileworldlive.com\/featured-content\/top-three\/iliad-boss-commits-e1-4b-to-share-buyback<\/p>\n\n

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From being known as France’s disruptive newcomer which instigated a long-running price war forcing the …<\/p>\n

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