Rewiring France

"For me," French President Valery Giscard d'Estaing likes to say, "France represents what is best in the world." But not, surely, when it comes to telephones. By almost any standard, France trails the rest of the major countries. It has the fewest private telephones in relation to total population (117.5 per 1,000 v. 460 per 1,000 in the U.S.), the fewest public ones (4.3 per 1,000 v. 13.9 in West Germany), and the longest waiting time for new installations (up to seven years).

Equipment is antiquated and erratic. Phones ring but the connection is dead. At other times three or four simultaneous conversations become scrambled on the same line. Fewer than 60% of all calls go through the first time they are dialed, and callers must often wait three seconds or more between tries for a dial tone.

Until fairly recently, the French did not take the telephone very seriously. Successive governments scrimped on expansion; from 1935 to 1968 almost no new equipment was installed. As late as 1962, the French Secretary of State for Posts and Telecommunications blithely dismissed the phone as a "gimmick." Charles de Gaulle would not even tolerate a telephone in his presidential office at the Elysee. His successor, Georges Pompidou, had a single phone on a side table but rarely used it; one of Pompidou's aides reportedly got only three calls from him in nine years.

Better Service. Now France's phone phobia is rapidly disappearing. After Giscard's election in 1974, one of his first acts was to have a modern telephone console installed next to his desk, and he uses it often. Other Frenchmen are beginning to want more phones too. New orders rose to 1.3 million last year, up from 291,000 in 1968, and a consumer group has been formed to lobby for better service.

It is on the way. At a recent Cabinet meeting, Giscard declared that modernization and expansion of the French telephone system was a top priority. The government plans to spend $23 billion on it over the next four years. Since France lacks the technological know-how for the job, Paris has turned to two foreign firms, the U.S.'s International Telephone & Telegraph and Sweden's LM Ericsson. Through a series of complex deals, Thomson-CSF, a big French electronics company (1975 sales: $2.7 billion), will acquire the French subsidiaries of ITT and Ericsson, thus gaining access to their technology and expertise. ITT and Ericsson, in turn, will receive big payments for their subsidiaries as well as large licensing and engineering fees. If Giscard's plan proceeds on schedule, the French level of service should be close to that of the U.S. by 1982.

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