Orange sees convergence as "pillar" for Europe growth - Mobile World Live

Orange sees convergence as “pillar” for Europe growth

25 JAN 2018

Gervais Pellissier, executive director of Orange’s European operations (pictured), is confident a big push into adjacent sectors and services will prove fruitful despite the industry’s lack of success in diversifying in the past, but added the operator will not forget its roots.

Speaking at the company’s press day for Europe (held in London this morning, 25 January), Pellissier, also group deputy CEO, said Orange was happy with what it was achieving by innovating and developing services in artificial intelligence and banking solutions, but pointed out “our main asset is infrastructure”.

Pellissier emphasised Orange was committed to maintaining its position as a “4G leader”, with 33 million customers, as well as fibre leader in Europe with 25 million households connected.

“We don’t forget that we are a carrier,” he said: “We are still keen to extend our 4G footprint and our fibre to the home (FTTH) offering across our European operations.”

Convergent play
The company’s Europe chief did, however, make it clear he believes convergence will be the key to Orange’s future growth in Europe, describing it as “the pillar of our strategy”.

A major part of Orange’s convergence play is the Love brand, which offers home internet, phone and TV services. The company first launched the strategy in Spain in 2016 and then rolled it out across European markets over the next ten months.

Pellissier added the company was able to boost its convergent performance on the back of the Love campaign and now has 3 million customers using its convergent offers.

“Convergence is mainly more loyalty from customers, with around 40 per cent decrease in churn when comparing convergent and non-convergent offers across Europe. It can also help with the launch [and] development of new telco services and new telco experiences,” he explained.

And Pellissier said Orange’s approach in 2018 would push heavily away from “connectivity for the individual” to a strategy targeted more towards an entire household and groups of people.

As part of the strategy, Orange said increasing the number of households it holds a presence in, and thus increasing the number of services it offers, could generate up to €1 billion in additional revenue by 2020.

Paolo Pescatore, VP multiplay and media at CCS Insight, told Mobile World Live it was clear Orange’s tactic is to add and cross-sell more services into households: “The future is all about bigger bundles of things and Orange is well placed with its extensive fixed and mobile assets,” he said.

Djingo and deals
Aside from convergence, Pellissier said the company was also keen to push additional services through its smart assistant Djingo, which it developed in partnership with Deutsche Telekom.

The home assistant device will launch in France in H1 2018 and in Spain in H2.

Pellissier was quick to dismiss fears an operator voice assistant would struggle to compete with rival offerings from technology giants like Amazon and Google, insisting Djingo would be used to cater to its own customers. He also said customers should not be concerned about how an operator like Orange will use its data, because “our core business is not to make money with data”.

Addressing recent consolidation rumours with its Djingo partner Deutsche Telekom, Pellissier said any sort of European consolidation was “not on the agenda”.

He added a “merger” would only have been feasible if Deutsche Telekom bought Orange, because of the former’s size and scale. But “a Deutsche Telekom takeover of Orange would have left a lot of people in France very unhappy,” he claimed.

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Kavit Majithia

Kavit joined Mobile World Live in May 2015 as Content Editor. He started his journalism career at the Press Association before joining Euromoney’s graduate scheme in April 2010. Read More >>

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