Orange will pull out of emerging markets if it misses top-two targets, Ovum comments

(PresseBox) ( London, )
At an MWC round table attended by Ovum, Marc Rennard, Orange's Executive Vice President for Africa, Middle East and Asia, said that Orange is looking to increase revenues from its emerging markets to €7 billion by 2015 compared with €3.4 billion today. But Rennard added that if Orange cannot be the number one or two operator in its emerging markets then it will pull out.

Eden Zoller, Principal analyst at Ovum has the following comment:

"The challenge facing Orange is how to build out network infrastructure cost economically, particularly in larger African markets. Rennard said network sharing will help with this.

"The other challenge is moving users beyond voice and SMS to more advanced data services. Rennard said that Orange would be interested in joining forces with other operators to collectively source phones for emerging markets, using their collective buying power to pass cost benefits onto consumers.

"However, the pricing of data services beyond SMS to price sensitive consumers is an issue that needs to be addressed and this is problematic. Rennard did not have any easy answers but said part of the answer lies in new business models for mobile broadband. Exactly what these business models should be was not clear, particularly as Rennard had reservations about how far mobile advertising can help in this context."
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