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Orange opens doors to one-stop mobile and web shop
'Get your free broadband 'ere... Want some FMC with that, love?'

By Jo Best

Published: Wednesday 31 May 2006

France Telecom has completed the branding transformation that will see it - and its ISP subsidiary, Wanadoo, and business arms Equant and Etrali - brought under the Orange brand. The renaming exercise will be accompanied by a raft of new business and consumer services, not least IPTV, a single fixed-mobile service and a 'free' broadband package.

The artist formerly known as Wanadoo will become Orange broadband, while Equant and Etrali will be united with the moniker Orange Business Services.

Orange will eventually bring all billing for business broadband, mobile and wi-fi into a single invoice, while all business customers will have a single point of customer services and sales. According to Orange CEO Sanjiv Ahuja, Orange is aiming to be "a one-stop shop for business customers".

Ahuja also revealed the newly united telco will start trialling a converged fixed-mobile service - where a single device is used for making mobile calls and 'landline' calls over the internet via wi-fi. The product will be tested first in France and then in the UK, with Wanadoo customers who are already equipped with the company's Livebox wireless modems.

At first, there will be a "limited number of devices," Ahuja said, adding that Orange will not be seeking to block users from using the handsets with VoIP services from other providers such as Google Talk and Skype. While at the moment the fixed-mobile convergence (FMC) product will be aimed at consumers, a business version is in the offing, Orange said.

Orange will be the second provider to launch a converged service: BT beat Orange to the punch, launching its Fusion service back in June 2005. Some 30,000 customers have signed up for Fusion to date. According to BT, which will compete with Orange in the fields of IPTV and broadband access as well as FMC, its customers won't be lured away by the upstart.

Gavin Patterson, MD of BT's consumer division, said in a statement: "It's a fantastically competitive market where value-for-money services mean more than price alone. We're confident BT's comprehensive internet security, BT Fusion and our broadband TV services will mean more to customers than a rebranded company making some bundled special offers."

According to Mark Newman, director of research at analyst Informa Telecoms & Media, Orange is entering an immature market - but its brand may help it.

He told silicon.com: "All we're really seeing is the bundling of different services. FMC is something different altogether - I'm not convinced the market is ready for a full FMC solution yet. I do think having a powerful mobile brand will give Orange a head start over BT."

Orange also announced it was to ape rival telco The Carphone Warehouse by offering a 'free' broadband package. Customers on Orange mobile packages costing £30 or more per month can get up to 8Mbps broadband with some free calls thrown in if they sign up to an 18-month contract. Users can also place free voice calls using VoIP for another £6 per month.

According to Declan Lonegan, director of wireless research at analyst house the Yankee Group, pricing for bundled services is more aggressive than many had predicted.

He told silicon.com: "The bottom line is designed to win market share potentially at the expense of ARPU (average revenue per user) and there will be cannibalisation for a certain number of users.

"Will it cut down churn? I think it will. The Livebox is one more incentive to lock customers in. These are not trivial devices to get up and running, whatever Orange would have us believe."

Bundling broadband with mobile and fixed-line services is fast becoming a theme among the mobile operators - Vodafone yesterday announced it plans to resell DSL to its customers and possibly get into local loop unbundling.

Other announcements from Orange included an IPTV service to be launched later this year using a set-top box which will also distribute high definition Freeview. Orange is now in negotiations with content suppliers including Sky.

More services are already in the pipeline, including a home-monitoring security service and health-related products. Coupled with HDTV, it's all a bit of a tight squeeze down an 8Mbps fat pipe. Not to worry, Eric Abensur, Orange VP of broadband, told silicon.com - the company will be rolling out ADSL2+, which has a top speed of 24Mbps, within the next year.