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Orange Puts Brits in the Picture

Orange SA (London: OGE) is the latest European operator to launch GPRS-based multimedia messaging services (MMS), kicking off with its picture messaging service in the U.K. (see Orange Intros MMS). It plans to launch the same service in five other European countries -- Belgium, Denmark, France, The Netherlands, and Switzerland -- though it has not set dates for those territories.

The service will play an important role in Orange's quest to have 25 percent of its U.K. revenues coming from data services by 2005. In the first half of 2002, non-voice services contributed 13.9 percent of U.K. revenues, up from 9.6 percent in the first half of 2001. Given that Orange is not committing itself to an exact date for its 3G rollout in the U.K. (see Juicy Results From Orange), the pressure on its GPRS services will be even greater in the coming years.

Orange, which has nearly 13 million subscribers in Britain, is the second of the U.K.'s four network operators to launch MMS, with T-Mobile (UK) having begun on June 1 (first MMS user numbers to be released later this month). Vodafone Group plc (NYSE: VOD) and mmO2 plc both plan to launch MMS in the U.K. before the end of 2002.

Orange's service, initially for post-paid customers only but extending to pre-paid in the coming months, differs from T-Mobile's mainly in its tariff structure. Simply, it costs 40 pence (US$0.61/€0.63) to send a message -- no matter how large or small it is in terms of kilobits -- but costs nothing to receive one. However, if you request a picture message from one of the special services Orange has made ready for the launch, such as sport or entertainment, then each message requested and received costs 25 pence ($0.38/€0.39).

This compares with T-Mobile's volume-based pricing of £20 ($30.6/€31.3) each month that allows users to send 10 megabits of messages. Just how many messages that allows depends on the size of the picture and whether an audio clip is added to it, but both Orange and T-Mobile reckon the average message size will be about 30 kilobits, so T-Mobile customers will have to go some to use up the quota they are paying for.

The real key for all the operators is getting as many customers using the service as possible. A larger installed base means more messages sent between phones and downloaded. Two major factors here are the interoperability of the multimedia messaging centers that handle the messages -- Orange is using Nokia Corp. (NYSE: NOK) kit in the U.K. -- and handset supply. Both are problems at the moment.

Orange only offers one handset now, the Sony Ericsson Mobile Communications T68i at less than £200 ($306/€313) with the camera attachment. Even then, early adopters will not be able to send a picture message to T-Mobile customers using the same handset, as the carriers' systems are not yet interoperable (T-Mobile's MMS system is supplied by Ericsson AB [Nasdaq: ERICY]). Orange MMS users can only send successfully to other Orange MMS users.

This makes it all a bit limiting to start with, really. Picture messages can be sent "off net" to PCs, and if a message is sent to a phone that can't receive the message (which is just about every single one, to start with), the recipient gets a text message telling them how to access the multimedia message at the Orange Website. Orange is not committing itself to any customer target numbers in the near future, though it expects 40 percent of its customers to have MMS handsets by the end of 2005.

So what is to be done? "Interoperability with the other operators is our top priority," Suzanne Snygg, Orange UK's senior product manager for multimedia messaging, tells Unstrung. "We will have a deal signed with one of the other network operators by the end of this year," though Snygg would not say which one, "and with the other two by the end of the first quarter 2003. Handset interoperability will be an ongoing issue as new services are rolled out."

Orange expects to have Nokia's 7650 phone on offer by the end of August for between £200 ($306/€313) and £250 ($383/€391), and to have handsets from about half a dozen other unnamed vendors before Christmas. "There are some cool phones out there. Panasonic has a neat one," says Snygg.

Roaming is another hurdle to overcome, though Snygg says Orange MMS users will be able to send picture messages internationally by the middle of 2003 -- just in time for the next summer holidays -- by which time some of the other Orange networks in Europe should be offering MMS services, though Snygg could not comment on any rollouts. Will any of the others launch in 2002? "I couldn't say. I think so. I hope so!"

She did, though, outline the types of picture messages that could be downloaded from menus accessed by dialing a three-digit number: news; sports; celebrity/entertainment; business; quirky (yup, quirky); and football teams (which is what us Brits call soccer).

What? No porn (sorry: adult entertainment)? Well, not just yet.

"It's possible that there will be a content relationship of that nature in the future," says Snygg. So that's a resounding "Yes" then. "It wouldn't be Orange branded. Of course, we would do everything in our power to ensure that such material did not get into the wrong hands…" Let's stop there, shall we?

Desperate not to sound like the smuttiest of the U.K. operators, Snygg adds that one of the other carriers has a "content manager specifically for adult services." Despite some pretty pathetic pleading from Unstrung, she would not name the operator. But we'd love to hear which one it is, or even hear from that person as to the content and pricing strategy -- our message boards await. After all, there isn't a mobile operator that can afford not to offer such "compelling content" to its customers, is there?

— Ray Le Maistre, European Editor, Unstrung
http://www.unstrung.com
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