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FT Turns Orange

Ray Le Maistre
5/31/2006

Orange (NYSE: FTE) turned bright Orange this morning as it announced a sweeping change to its service brand strategy. (See FT Unveils New Orange.)

From tomorrow (June 1), the carrier's mobile, fixed broadband, IPTV, and business services in France and the U.K. will take the Orange SA (London/Paris: OGE) brand that has, so far, served the carrier well in the mobile services world. That means the end for the Wanadoo (broadband), Equant (business services), and MaLigne (French IPTV) brands. Equant will become Orange Business Services.

France Telecom signaled this move in mid-2005 when it launched its NExT (New Experience in Telecom services) strategy. (See Eurobites: Big Guns Fire Salvos.)

The rebranding goes hand-in-hand with the announcement of a new fixed/mobile convergence service in France called Unik, which will be launched commercially in September. Like the Fusion service from BT Group plc (NYSE: BT; London: BTA), it enables calls in the home to be routed via a home gateway and out of the home over a fixed broadband line. (See BT Goes Blue.)

French customers with Orange 8-Mbit/s broadband can now get high-definition IPTV, high-definition VOIP, various multiservice bundles and packages, a single online services portal, and a single customer support contact for any of the Orange services. Mobile customers can subscribe to an all-you-can-eat mobile TV service.

In the U.K., the company is, as expected, offering a free DSL broadband connection to mobile customers who sign up for a contract worth at least £30 (US$56) per month. That package also includes free calls over the broadband connection, via a Livebox home gateway, to any Orange mobile customer. (See Orange Juices Free Broadband Battle.)

Orange UK currently has 15 million mobile customers and 1 million broadband customers that have signed up for the Wanadoo UK service. The company announced job cuts last month as it combined the mobile and broadband operations. (See France Telecom Culls UK Staff.)

The new Orange Business Services unit comprises Equant, which offers international services in 220 countries, the current Orange mobile business services, and Etrali, a specialist financial trading subsidiary.

But Ovum Ltd. analyst Mike Cansfield has doubts about extending the single brand into the business market. In a research note issued today he says the "logic is sound enough for the consumer and SME segments of the market," and reckons the "free broadband" package on offer in the U.K. is "an impressive bundle."

But he says Equant is "a very well established and respected brand in this segment." And although a number of other brands have disappeared from this market in recent years -- including Concert, Infonet, KPNQwest, and MCI -- "stability is highly prized in this segment, not only because communications is the lifeblood of corporates, but also they all remember the near industry meltdown of a few years ago. So changing brands is risky."

— Ray Le Maistre, International News Editor, Light Reading

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