In recent months I have been fairly critical of Free, a company that I long admired and suggested in the past might be a blueprint for a successful broadband operation without the legacy of past telco organisation and thinking. Not only did Free's numbers slowly deteriorate in the last couple of years, but their innovation machine seemed to be stalled and their public declarations suggested that they might gradually be shifting to thinking like an incumbent.
A stunning set of features
For a couple of months now, Free suggested they were about to make a revolutionary announcement, and that announcement was today. It's a new CPE, and it's called the Freebox Revolution. On the face of it, it might be hard to imagine that announcing a new CPE would be in any way revolutionary and yet looking at the feature set that was announced this morning, it might very well be. Here's are the top-line features, there's probably more little stuff that hasn't been announced yet (or that I haven't seen):
- as its predecessor (the so-called Freebox HD or v5), the Freebox Revolution is actually two devices, a router and a set-top-box.
- the router is now called the Freebox Server and features 4 GE ports (for LAN) and a Wifi 802.11 3×3 solutions for an announced 450Mbps peak throughput.
- the Freebox Revolution hard drive is now lodged in the Freebox Server (it used to be in the STB as DVR was the main perceived usage) and acts as a NAS and UPnP server.
- the Freebox Server also acts as a DECT phone base.
- the Freebox Revolution will be delivered with a two-way BPL to ensure connectivity between the Freebox Server and the Freebox Player.
- the set-top-box (now called the Freebox Player) features an Atom CE4100 1,2 GHz processor (Free says that's three times the processing power of the recently released SFR Evolution STB) and an in-build Bluray player. It features a DTT decoder as well, as the previous generation did.
- the remote control features a gyroscope and an accelerometer to help navigate through TV channels and content stores.
- the Freebox Player will be fully open to 3rd party developers with an SDK to be released soon. It will also feature video games (including 3D games) developed by renowned studio Gameloft. The Freebox Revolution will be delivered with a dedicated gamepad.
- starting in January, Free will offer (or sell) an iPhone/iPad app to access all contents in the NAS, manage the TV offering, and act as virtual keyboard.
- the Freebox Player also features a full web browser. The remote control's gyroscope will allow it to act as a mouse, and the browser will feature a virtual keyboard enabling point and click with the remote.
Pricewise, the Freebox Revolution will apparently be free for subscribers who have changed their previous Freebox 4 years or more ago, and be subject to a retroactive fee of 120 EUR – 3 EUR per month for customers who get the new STB and leave before the next 4 years. It's not entirely clear to me what existing customers who have been subscribers for less than 4 years pay.
The subscription triple-play package stays the same with a couple of twists: unbundled customers (and, I suspect, FTTH customers although that's not clearly spelled out) will pay an extra 6 EUR/month as a "fee to access the dedicated local loop". In addition, any increased in VAT as part of the new legislative framework for bundled services will be applied. All in all, unbundled customers can expect to see their monthly bill increase from 30 EUR/month to close to 40, not far from my earlier prediction.
The new package includes free calls to all mobiles 24/7 though, and that was the last "big" chunk of pay as you go communications, so all in all it probably means that people won't be worse off and many might even end up a little better off. Customer support will (finally) be free and on-site support within 10 hours will be offered as part of the package for non-resolved issues.
Is it the revolution that Free needs?
There is little doubt that the feature-set at the price Free sells its services is astounding and in that sense – on the scale of the French market (one of the most advanced broadband markets in the world in terms of features for price ratios) – it is a revolution. The real question, however, is "is it what Free needs to regain the innovation leadership in the market?" There, the answer is trickier.
Free pushed the all-in-one concept to its extreme with this new CPE set and in that sense, their offering is no longer triple-play: internet, television and phone are now joined by a number of displaced external devices, namely DECT phone, blu-ray player, NAS server and game console. While the DECT and NAS capabilities might be attractive to existing customers and geeks, the other two are the features likely to attract new customers. There's a large portion of customers in France who still have no blu-ray player, and while displacing game consoles might be more hypothetical, it's an added feature that will most likely be welcome. Finally, while it might look secondary in the face of the feature set here, the inclusion of all mobile calls in the basic package is an important factor of economy.
A deeper look at what's happening in the French broadband market however suggests that despite being the broadest feature set imaginable for such a CPE, Free might not have what it takes to stop the erosion. The main reason that Bouygues Telecom is leading in broadband customer acquisition is that they offer a quad-play offering. Orange is now following in Bouygues Telecom's steps, and it's doubtful that SFR won't have a 4P offering within a few weeks. Unfortunately for them, Free cannot match that anytime soon. Their mobile offering won't be available before 2012, and in fact there's no mention of femtocells in the box (which doesn't necessarily mean it's not there, just that there was little point in announcing one…)
I will be closely following the numbers (and I will also be getting a Freebox Revolution as soon as Free will let me) to see if the innovation drive (Free's offering) weighs more than customer savings (Bouygues Telecom's and others' 4P) in broadband retention and acquisition in the next few months. One thing is quite clear though: Free has spared no effort to make a big splash with this one. Success now will be a combination of execution (how fast can they ship out the boxes), promises met (is the ergonomy up to it ?) and customer appetite for more as opposed to cheaper…
Addendum: In case you want to delve deeper and you speak French (or are willing to use online translators), excellent tech guru and blogger Olivier Ezratty has written two very detailed posts about the hardware of the Freebox Revolution (Les Entrailles de la Freebox 6) and the Software and UI (Les Logiciels et Contenus de la Freebox 6). Well worth a read.
Second Addendum: Olivier has written a third, very comprehensive post on the competitive play of the new Freebox (La concurrence de la Freebox v6 et ses enjeux) and says a fourth and last post will cover the organisation and team within Free that has allowed the Freebox v6 to see the light of day.