Two huge sites that has lead Free in parallel

For Free, it is cheese and dessert. The Internet access provider put on fiber optic and mobile telephony for future growth. Two huge sites that has lead Free in parallel. On the occasion of the publication of its annual results, Iliad, the mother House of Free, confirmed yesterday that it intended to invest EUR 1 billion in very high here in 2012, and all flow in the mobile. A sum for the less plump for a group who made last year a net result of EUR 100 million, down 33 following the acquisition of Alice...

Free horizon in the mobile emerged with the decision of the Government to pave the way for a fourth operator. The company now anticipates the launch of the call for entries "in April" for a grant of the licence "at the end of the year". If the folder is chosen which it does not appear to doubt it plans a commercial launch "twenty months later. Despite a number of frequencies lower than three operators in place, Free believes that it "can be used without any problem more than ten million subscribers with national coverage," according to the Director General, Maxime Lombardini. "Our preference is to pick up our single mobile licence," said founder Xavier Niel, without however completely close the part to partnerships.

Concerning the development of very high-speed Internet, Free view, the France is "almost ready" for a massive deployment and still is 4 million homes linkable from here in 2012. But for the time being, the operator limited its investment to EUR 80 million last year, "pending clarification of the regulatory framework. This should not delay. At the time, Free anticipates "a rise in investment from the second half of power".

"Generation of cash".

But the access provider is not eyes bigger than stomach in an attempt to play on two tables Free has worked, yesterday, its efforts to allay fears about its ability to finance the fibre and the mobile.

"The emphasis will be placed on the generation of cash," said Maxime Lombardini. "Free cash flow generated from our ADSL business was multiplied by nine last year without taking into account of Alice and it will be more than one billion euros cumulative for the period 2009-2011", continued the Chief Financial Officer, Thomas Reynaud. But where will come the second billion euros for investment Free intends to improve its profitability by being less dependent on France Telecom. This means, first, by unbundling and then by fibre optics. Free view to achieve a gross margin of 85 by client connected to the fibre, against 50 today with an unbundled ADSL Subscriber.

Improvements in the efficiency will be increased also by the relief of Alice, who lost "EUR 1 million per day in 2008" and the redemption last August moved net debt of Iliad at 882 million at year end.

Because of this, the company expects a "strong increase" of its net income in 2009. It also plans to limit its debt to a level equivalent to that of its gross operating surplus at end of 2009, either with one year in advance from the initial plan.