In an explosive report of the parliamentary office, the father of Sophia Antipolis denounced an outrageous cost of licences which might entail an "industrial disaster" in Europe.
The cost of UMTS licenses was thrown back into question. Whereas there are more and more people denouncing the hysteria which has spread in the financial, political and industrial world concerning the telephony of the third generation, the senators Pierre Laffitte, the father of Sophia Antipolis, and René Trégouët, have just presented in Paris an explosive report of the parliamentary office for the assessment of scientific and technological choices. A part of this report was made from a consulting of high tech entrepreneurs on the French Riviera (IBM, Realviz, Activia, Sigma technologies, Nortel, Cisco, etc).
70 billion francs spent before starting!
What is denounced? The outrageous cost of UMTS licenses in France as well as in a few European countries as in Great Britain and Germany. This bill, which includes the price of licences (900 billion francs in Europe) and the development of networks (about the same amount) may lead to an industrial disaster and ruin the advance that Europe has on the United States in the sector of the mobile telephony.
We have been in charge of a survey on the consequences of the scientific and technical evolution in communications since a year, the senator Laffitte notes. However, since then, the allocation of UTMS licences in Great Britain, Germany, and France was a disaster. Both of us, -the senator Trégouët and myself-, rised up against the costs that we found totally excessive. If you take the case of France, between the debit (32 billion francs) and the cost of the network development (about 40 billion francs), an operator would have to spend 70 billion francs even before earning the slightest centime."
15 billion francs at maximum for the 4 operators
"How can you offer services to the general public at an affordable tariff whereas so much money has been spent, whereas a technique which doesn't exist yet has to be developed, whereas services which don't exist yet will be offered? An evaluation which takes into account the amortization of investments, running expenses, and the remuneration of services, should put the monthly package between 600 and 1,000 francs. Is the general public, which doesn't have yet the practical of digital loops in France, ready to pay this price? Certainly not."
"Besides, the A.R.T., during the allocation of licences last week, has done the same analysis than us. The regulation authority for telecommunications has even published the figure it had given to us confidentially: the maximum debit for the four operators is 15 billion francs (or a bit less than 4 billion francs per operator). We are very far from the 132 billion francs claimed."
Start from scratch
But didn't it begin yet? Isn't it already too late to back-track and start again on bases which suit more a market, which sobered up nowadays? The senator Laffitte thinks that, on the contrary, something has to be done. We say that we have to start from scratch not only in France but also in Europe, in Great Britain, Germany. Besides, we sent the report to Tony Blair, to Gerhard Schröder. The stake is enormous when you know that the NTIC contribute to the third of the economic growth. If the UMTS reveals to be a disaster, the sector of NTIC won't be able to develop. The social and fiscal losses will be enormous."
"However, I am going to go further myself. We have to get this opportunity to put an end to the monopoly of TDF which is very expensive for all broadcasting companies and which isn't justified anymore whereas television and telecommunication monopolies ended. These important points on which TDF could be used by the telecom operators, all the more since there is a convergence between television and telecommunications. Frequencies need to be considered too. That will be dealt with during a big meeting at Sophia Antipolis on the two last weeks of December 2001 and when everybody will meet: telecom operators, television broadcasters, authorities, etc."