New French mobile phone operator Iliad said it has signed up 2.6 million customers since launching its super cheap service in mid-January.
The buzz around Iliad’s ‘Free Mobile’ offers also allowed it to recruit 191,000 new customers to its core broadband internet service.
Iliad touched off a price war forcing its established rivals – France Telecom, Vivendi’s SFR, and Bouygues Telecom – to spend heavily to try to retain customers.
Iliad’s shares rose after it reported a better-than-expected 29 percent rise in first-quarter revenue to 655.7 million euros.
The new mobile business brought in some 97.5 million euros.
Analysts say Iliad will eventually turn France into one of the toughest markets in Europe.
Iliad’s Free Mobile launched in mid-January with a 19.99 euros per month offer, which includes unlimited calls, texts and mobile Internet up to 2 gigabytes. It also created a two euros a month package of one hour of calls and 60 texts, which it gives away for free to its broadband clients.
Beyond offering lower prices, Free Mobile also established a different business model than its larger rivals: its customers pay for their own mobiles and can leave whenever they want, forgoing the traditional generous mobile subsidies that operators give on smartphones with one or two-year contracts.