France Télécom Essay ⋆ Business Essay Examples ⋆ EssayEmpire

The company France Télécom is the main telecommunications company in France and one of the largest in this field in the world. Until 1988 it was a part of the Ministry of Posts and Telecommunications, and was known as the Direction Générale des Télécommunications. The ministry traces its origins back to the 18th century when the French monarchs controlled the transportation system for the country. In 1794, five years after the French Revolution, the monopoly was broken and private companies were permitted to transport packages, but it was soon found that this removed a lucrative source of income from the government, and in 1804 Napoleon reintroduced the monopoly. The government also controlled the telegraph system when it was introduced but started to relax this in the 1850s.

In 1878 the first telephone was introduced to France, and three telephone networks were established; these were later merged to form the Société Générale de Téléphone (SGT), much to the joy of many people who objected to unsightly telephone lines along the streets. The Paris telephone exchange opened in 1881 and it was soon apparent that the SGT was interested in establishing a telephone network only in Paris and the major cities. It had its license renewed in 1884 for five years, but the system lagged that in many other countries, and in 1889 the French government took control of the SGT and started running the telephone service itself with the Ministry of Posts, Telegraphs and Telephones, and produced the first telephone directories in 1890.

Even under French government control, the system still lagged that in many other countries, and in 1900 there were only about 30,000 telephones in the country. By comparison, in 1909, the 100 largest hotels in New York boasted 27,000 lines. The congestion at the telephone exchange was also so bad that in 1905 it took two minutes for a connection. The government decided to improve the service and by 1912 there were 72,000 telephones in Paris, accounting for more than half of the telephones in the country.

In the years just before World War I, the French telephone service, worried about spies, removed anybody who had German ancestry or heritage. During World War I, the telephone network in northern

France was disrupted by the German invasion, but the French army tried desperately to maintain it. When the U.S. forces arrived, the American commanders were shocked by the telephone service in Paris and rebuilt the entire network.

During the 1920s and 1930s, about half of the subscribers in France were still living in Paris, and in addition to the regular telephone directory, the company Didot-Bottin produced a commercial directory listing businesses and also many private subscribers, not only in France but also overseas, especially in the French Empire. With the outbreak of World War II, the French telephone system was put under considerable strain by the military, but their commander General Maurice Gamelin was so distrustful of the telephone service that he refused to reply on telephones in his headquarters in Vincennes. German engineers were brought in to repair some of the telephone lines during the war, and the system was not that badly affected during the liberation of France in 1944.

After the end of World War II, the French telephone network in the countryside, especially in southern France, was dramatically expanded, although Paris continued to make up about a third of the subscribers in the country. The French telephone engineers were also responsible for constructing the telephone network in much of the French Empire, especially in Algeria and Morocco. In addition, French telephone engineers were employed on the telephone service in Egypt.

In 1988 the French government finally decided to sell the telephone service and it was privatized. It still continues to help with telephone networks around the world, and employs about 191,000 people, half of whom work outside France. It also has about 159 million customers around the world, and in the 12 months ending in September 2004, it had a revenue of US$60.1 billion; in 2007, its revenue was €52,959 billion. In 2005 France Télécom bought a 77 percent share in Amena, the Spanish mobile telephone company, and renamed it Orange Espana, and in November 2007 it was able to buy 51 percent of Telkom Kenya from the government of Kenya. Until 2003, it also had a large share in Telecom Argentina, selling it down to 1 percent, and also owned the telephone network in El Salvador.

Bibliography:

Pierre Aulas, Les origines du téléphone en France (Paillart, 1999);
France Telecom Laws and Regulations Handbook (International Business Publications USA, 2008);
Ben Hall and Andrew Parker, “France Telecom Turns Its Attention to Africa,” Financial Times (September 16, 2008);
Philippe Lorino, Competence-Based Competence Management: A Pragmatic and Interpretive Approach; The Case of a Telecommunications Company (ESSEC, 2007);
Eli Noam, Telecommunications in Europe (Oxford University Press, 1992).

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