Hacker, peep shows, jail: the story of a French tech billionaire

Artificial intelligence is the next realm to be conquered in legendary tycoon Xavier Niel’s colourful career

Xavier Niel announced a €200million investment in AI following business success in internet, media and property
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Xavier Niel is already an entrepreneurial legend in France, and his latest venture looks set to consolidate the myth – and his money.

Listed as the 365th richest person in the world by Forbes in 2023, with a sprawling empire spanning some 800 different companies, Mr Niel’s main interest is technology.

AI project supported by Macron

Last autumn, he announced a €200million investment in artificial intelligence, including the purchase of a supercomputer and the creation of a dedicated research laboratory.

The project has garnered strong support from President Emmanuel Macron, who declared AI a “technological sovereignty issue” in which France needs to position itself “among the frontrunners” alongside US companies such as OpenAI, Google and Microsoft.

“When a tech revolution erupts, we want to be part of it,” Mr Niel said.

“Twenty-five years ago, the revolution was the internet – and we were there. Today, it’s artificial intelligence – and we’re making sure we’re there for that too.”

Read more: $193bn: how did this French businessman get so rich?

Sinclair ZX81 computer changed his life

Xavier Niel was born on August 25, 1967, in Maison-Alfort (Val-de-Marne) into a middle-class family. His father was a patent director in a pharmaceutical company and his mother a bookkeeper.

His career trajectory was set when he received a Sinclair ZX81 computer as a Christmas present aged 14.

“It changed my life because I was given something over which I had control,” he said in an interview with La Chaine Parlementaire.

“I had a little sister who ruled the roost in our house. I was the one who wasn’t listened to or who had to do whatever she wanted us to. But this computer, when I asked it to complete something, it did it. It obeyed me.”

Set up sex chatline on Minitel

An average student, he dropped out rather than follow his peers to university and, aged 17, forged his father’s signature to get a second phone line installed to the household’s Minitel – a French computer network, predating the worldwide web, which was open to anyone with a telephone and brought ‘online’ banking, travel reservations (and porn) to the masses.

Mr Niel used it to chat to fellow computer geeks and helped develop Minitel Rose, a chat service dedicated to cybersex. It became one of the most lucrative on the network.

Clients would call lines he owned and pay up to 60 francs per hour.

His expertise with computers also got him noticed by the security service after he was caught hacking the French channel Canal+.

As a teen in the 1980s, he claims to have worked undercover on cyber issues for the Direction de la Surveillance du territoire (DST), during which time he was tasked with hacking the database of French mobile phones, including then-president François Mitterrand.

Read more: Tributes to Jacques Delors after he dies aged 98

Charged with pimping at his peep show chain

Alongside the sex chat services, Mr Niel was part-owner of a chain of peep shows.

One of these was later found to be a front for prostitution and in 2004 he was arrested on charges of aggravated procuring (pimping).

While the charge was ultimately dropped, Mr Niel spent four weeks in jail for concealing the misuse of corporate funds in connection with income from the peep shows.

Free internet wiped out competitors

In 1993, when he was just 25, Mr Niel invested in France’s first internet service provider, called WorldNet.

His timing, when he sold it for €40million seven years later, was impeccable – just before the dotcom bubble burst.

Under the parent company Iliad, founded in 1990, Mr Niel launched a second internet service business in 2002 – Free.

Offering the world’s first triple-play package of phone, television and internet on a single broadband connection, the Freebox was a huge hit.

At €29.99/month, it wiped out competitors such as AOL and Club Internet, which offered separate subscriptions for each at prices which were sometimes twice as high.

“Whoever gets Free gets it all,” screamed the commercials flooding TV screens.

Broke up Orange, Bouygues and SFR monopoly

Ten years later, in 2012, he moved into the mobile services market with Free Mobile, offering unlimited voice calls, text and data at the lowest price in France (€19.99/month).

Mr Niel’s decision was motivated, in part, by revelations that the three main players in the sector – Orange, Bouygues and SFR – had agreed to keep prices high to maintain their monopoly. They were ultimately fined €534million for it.

Mr Niel said in Free Mobile’s keynote presentation: “I am going to tell you something extremely simple. Look at your subscription when you get home.

“If you pay more than €19.99 and do not call your service provider or come to Free, you are the sucker and you know it.”

Free quickly claimed a million new customers, depopulating Orange, SFR and Bouygues of 400,000, 200,000 and 134,000 clients respectively in several weeks.

The Iliad Group, as a whole, now boasts 45.3 million subscribers, including in Italy and Poland.

Read more: Free, Orange, SFR: which mobile operator best covers France?

Support for tech entrepreneurs and angel investing

Mr Niel’s unorthodox journey to self-made billionaire makes him regular fodder for magazine and newspaper features.

More than simply a savvy businessman who made the internet affordable for millions, however, he has spent a large proportion of his fortune helping would be entrepreneurs follow in his footsteps.

In 2013, for example, he opened 42, a tuition-free coding school in Paris named after the number Douglas Adams identified as the “answer to the ultimate question of life, the universe, and everything” in sci-fi classic The Hitchhiker’s Guide to the Galaxy.

The school, hailed a techie’s version of a grande école, has since opened branches elsewhere in the world, including the US.

Mr Niel is also behind the start-up incubator Station F in Paris and, in March 2010, he co-founded Kima Ventures, a fund dedicated to invest in 50 to 100 new businesses a year.

The project prompted Business Insider to describe Mr Niel and his co-founder Jeremie Berrebi as the most active angel investors in the world.

Newspaper and TV interests

Mr Niel also has interests in the media, boasting a controlling stake in Groupe Le Monde, which publishes not only the daily newspaper of that name, but magazines such as l’Obs and Télérama.

In 2020, he acquired Groupe Nice-Matin, as well as the horse-racing newspaper Paris-Turf.

He is also a share-holder in Mediawan, a TV content creation firm and, with a passion for property, is the main private shareholder in the international commercial property company Unibail-Rodamco-Westfield.

His other assets include a five-star hotel in the ski resort Courchevel (Savoie) and Lys Chantilly golf course.

Mr Niel was recently awarded the Légion d’honneur and is regularly named among the most influential personalities in technology.

He lives with Delphine Arnault, the daughter of one of the world’s richest men, Bernard Arnault, in Paris.

‘Pirate’, ‘French Steve Jobs’ and other nicknames

Xavier Niel’s most popular nickname is the pirate, which dates from his early hacking days.

One unauthorised biography even takes its title from that moniker: La voie du pirate (The Path of the Pirate).

Another is an analogy with the former CEO of Apple – Mr Niel is commonly referred to as the French Steve Jobs by journalists. However, Mr Niel has publicly spoken of his admiration for another Apple giant, the US engineer/designer and so-called ‘father of the iPod’, Tony Fadell.

However, it is as the casseur de monopoles (monopoly breaker) that Mr Niel would like to be immortalised on his tombstone, according to an interview he gave to Décideurs TV: “I have an aversion to monopolies that abuse their position,” he said.

“I want to break them endlessly, even if it is unsustainable from an economic standpoint.”

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