23 January 2013

South Africa: Orange Eyes South African Opportunities

France's Orange Telecommunications has launched a new subsidiary, Orange Horizons, to seek out business opportunities in promising new markets - and has made its first moves in South Africa, with more set to follow.

Orange announced last week that the first of its Orange Horizons projects had launched in South Africa, in the form of an e-commerce website - store.orange.com/za - selling telecoms-related devices and accessories, combined with a country website, providing a variety of online content tailored for a South African audience.

The launch of these services coincided with the start of the 2013 Orange Africa Cup of Nations (Afcon) football tournament, sponsored by Orange and hosted in South Africa.

These initiatives were aimed at establishing the group's brand in South Africa while feeling out ways of breaking into a lucrative mobile market dominated by MTN and Vodacom.

Orange, owned by France Telecom, reportedly aims to launch a launch a mobile virtual network operator (MVNO) service - one that piggybacks on another company's wireless network - in South Africa.

According to technology news website ITWeb, the company has confirmed that these are its plans, while stressing that it will take a step-by-step approach aimed at building a solid base in the country.

Orange Horizons MD Sebastien Crozier told ITWeb this week that the group was not interested "in being a partial MVNO, or an operator by brand only. We want to be a competitor and be able to do more. We want to create a global system and be able to offer the same services as mobile operators."

However, the group's immediate focus in SA would be on products and services not yet available in the country, Crozier said, with niche telecoms services for tourists soon to come, and physical stores in the pipeline.

"In 'Orange countries' where we are an operator, we see 1.2-million people coming in to SA each year," Crozier told ITWeb. "The opposite is true as well - there are many South Africans who choose Orange countries as a travel destination. We want to help people to have better and easier telecoms access when they are in a foreign country."

Crozier told Business Day that while the South African mobile market was mature, the country still offered room for growth, especially given that local data prices were still relatively high.

"Crozier did not rule out acquisitions in the future, but he said it was too early to discuss this as the company had chosen 'a light (expansion) model'," Business Day reported.

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