French cell companies nailed for collusion

French cell companies nailed for collusion

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Three French cellphone companies are getting hammered with fines, its going to cost them a total of $627 million (€534). Orange, SFR and Bouygues Telecom have been found guilty of sharing information and colluding between 1997 and 2003. The competition commission in France has ruled that the companies shared confidential information and divided the market between them.

The decision is clearly bad news for the companies. Besides the large amount of fines to be paid, the companies face customer backlash and potential legal action from consumer groups. This is bad press and it won’t help credibility.

Not surprisingly, no one is happy and they are going to appeal the decision. They suggest that fluctuations in income from month to month indicate that there was tremendous competitive pressure in the sector. They also suggest that controlling a market of 40 million consumers and 20,000 points of purchase is well beyond their abilities.

The fines weren’t equally spread between the companies. Orange will be paying $301 million (€256m), SFR owes $258 million (€220m) and Bouygues is on the hook for $68 million (€58m).

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