Orange Concessions starts work on rural FTTH
It's been a busy week for Orange on the infrastructure management front: just days after officially launching its tower company, Totem, the France-based operator has announced that Orange Concessions is now operational.
Initially unveiled in January 2021, Orange Concessions brings together the operator’s 23 "public initiative networks" with a total of 4.5 million deployed or planned fiber-to-the-home (FTTH) connections across France. Public initiative networks form part of the French National Broadband Scheme and are open to all operators on a wholesale basis.
Orange owns 50% of the venture, while the other 50% is owned by a consortium made up of La Banque des Territoires (Caisse des Dépôts), CNP Assurances and EDF Invest. The operator decided to sell 50% of the venture as part of efforts to share the cost of deploying FTTH networks in rural areas.
Orange said the strategic partnership, which valued Orange Concessions at €2.675 billion (US$3.16 billion), was finalized on November 3.
Jean-Germain Breton, an Orange executive who is said to have a solid track record in managing public initiative telecoms networks and working alongside local authorities, is to take on the role of chairman of Orange Concessions. He will oversee a team of 100 people, 60% of whom will be located in the regions, close to the local authorities.
Stéphane Richard, chairman and CEO of Orange, said 30% of FTTH connections in rural areas of France will be operated by Orange Concessions by 2025.
"I am now delighted that long-term investors – recognized for their infrastructure expertise and their proximity to local authorities – have acquired a stake in Orange Concessions. Orange is more committed than ever to being the go-to partner for local authorities in their regional digital development projects," Richard said.
Totem in pole position
Totem, meanwhile, has been up and running since Tuesday and will manage all key passive mobile infrastructure assets on a neutral and independent basis.
As of November 2021, the towerco's portfolio includes over 26,000 sites in France and Spain – the two largest countries where Orange is present. Totem France will manage 18,500 macro-sites with a mix of 58% tower sites, 30% flat roofs and 12% in other locations. Totem Spain will manage 7,900 macro-sites, distributed equally between tower sites and flat roofs.
Totem initially has around 100 employees in France and 50 in Spain. About 20 people will be working for Totem Group. The towerco will also consider the option of incorporating other European passive mobile infrastructure assets from the Orange group.
Richard described Totem's operational launch as "an important milestone in our European infrastructure strategy."
"The creation of this entity will allow us to derive value from our passive mobile infrastructure … by opening up these assets to other operators, we will optimize its use. We are determined to support Totem on both a strategic and financial level, to make it an undisputed leader on the European market and to keep control of this strategic asset as part of a long-term industrial vision. By retaining control of our infrastructure, we have made a crucial decision for our future growth," he said.
As well as Totem and Orange Concessions, Orange Poland has formed a partnership with Dutch pension fund APG that aims to speed the rollout and reduce the cost of its FTTH network throughout the country. The operator created a 50:50 joint venture called FiberCo with APG, which is the asset management division of ABP.
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- Orange's Richard hopes to hang on as chairman after 2022
— Anne Morris, contributing editor, special to Light Reading