The ratings on France Telecom S.A. (FT) reflect the group's disciplined financial policy, robust free operating cash flow (FOCF) generation, and leading positions in the French mobile- and fixed-line telecommunications markets, as well as the growth opportunity offered by the group's strong international mobile franchise. The ratings remain constrained by the high level of competition in France's broadband market, the rapid technological changes transforming the traditional fixed-line business model, and the group's somewhat limited flexibility to reduce labor costs owing to the still-high number of civil servants in its French workforce. France has one of the EU's most competitive broadband markets, with 51% held by alternative operators, notably through rapid local-loop unbundling. Nevertheless, FT has stabilized both its market share
