Rodrigo Sepúlveda Schulz (hat tip: Om Malik) reports on the incredible broadband price wars going on in the French market.  For instance, free.Fr offers 20 Mbps service for €29.99, or $1.50 euros per Mb/s a month.  Neuf (subway ad shown to the right) has an 8 Mbps access monthly package for €14.90, whereas Noos (an MSO) offers 10 Mbps for €10 a month. 

So what's behind all this?  Could it all be due to France Telecom's decision to "be all it can be" (to borrow the catch phrase for US Army recruitment)?  France Telecom (FT) opted to offer the maximum throughput available on all ADSL lines in France, having pretty much reached an almost universal plateau of 6 megs to the majority of its customers last year.  This is in sharp contrast to its neighboring incumbents (BT and Deutsche Telekom), that are still engaged in limiting their DSL data rates.  FT's DSL penetration is roughly 90 percent and is expected to grow over 95 percent this year.  Also, this year, ADSL 2+ will be deployed and speeds will go up to 16 Mbps (pretty amazing).

But despite all that progress, Rodrigo wonders whether or not these service providers are committing harakiri in dropping rates so low that even costs are no longer covered.  I am drooling thinking "what if" Bell Sympatico and Rogers could ever offer us such value (dream on).  But what will the French net citizens do with so much bandwidth?  That's a pretty valid question.  HDTV is roughly 19 Mbps, and one of the highest riders.  Perhaps video conferencing? 

What if Vonage were to offer a three-way conference calling service in France and call it "Vonage à Trois"?  Are you laughing?  It certainly would not be beyond the realm of possibility.  Mark Evans reported on a poll that Vonage Canada conducted with the help of Decima Research, geared towards finding out who people would want to engage in phone sex with.  The result?  Brad Pitt (the top choice for the ladies) and Angelina Jolie (the top gentlemen's pick).  This is all a part of a branding campaign launched just in time before Valentine's Day.

Despite some gloomy forecasts out there about the wireline capex impact of the fusion between SBC and AT&T, there will be also a few opportunities to be had.  Management's guidance was that there is little impact in capex plans for 2005 and that there will be some savings of 3% of their total budgets (roughly $200 million).  It is debatable whether or not those will hold true, but the fact remains that AT&T (NYSE:T) and SBC (NYSE:SBC) mostly have a non-overlapping footprint (with the exception of some of AT&T's metro networks). 

From a TDM switching perspective, the legacy Lucent and Nortel Class 4 and 5 switches will stay in the SBC network until either their useful lifetime expires or there is a real compelling business case for migration to IP.  SBC has been evaluating softswitches from Alcatel, Nortel and Sonus for quite sometime, and there are some rumors that Nortel might have a slight edge over its competitors.  While SBC has been slow out of the gate in replacing its Class 5 infrastructure (when compared to Verizon), it could be conceivable that the new SBC might accelerate those plans, particularly considering the IP-centric nature of AT&T's core.

On the AT&T side, a capacity upgrade of the backbone might become necessary to support the extra SBC traffic, with such a deal being pegged at a quarter of a billion dollars.  The usual DWDM suspects will be in the running for such an RFP when it is announced, including Lucent and Siemens.  It is also likely that AT&T will develop some video infrastructure to support the offering of triple play services.

Regardless of the above-mentioned opportunities, it is true that historically, carrier consolidation disrupts vendor sales.  At the end of the day, a vendor like Cisco might sell less IP gear because SBC might no longer have to build its backbone on a nationwide scale.  But the flip side of that argument is that if carriers are integrating networks, this might accelerate the migration to an IP infrastructure. Also, the pursuit of synergies might lead a carrier like SBC/AT&T to pursue a newer architecture such as IMS (IP Multimedia subsystems).