Orange has a new corporate strategy, called Lead the Future, which the company’s CEO Christel Heydemann laid out yesterday, along with its full-year 2022 earnings.
One highlight of Heydemann’s announcements was that the Orange Group will decrease its Capex spend. It plans to cut €600 million ($640.25 million) by 2025 on a previously-set cost base of €11.8 billion ($12.59 billion). The CEO said the Group’s investments peaked in 2022 and will fall from 18% of revenues to around 15% starting in 2023. This reduction is particularly centered on France and Europe, where most of the investments in fiber have already been made.
Orange, a major digital player in Europe, Africa and the Middle East, calls itself “a pioneer in fiber.” The company also has mobile networks, where it’s offering non-standalone (NSA) 5G and working toward standalone (SA) 5G.
Heydemann said its new Lead the Future strategy has four pillars:
1 - Capitalizing on its core businesses.
The company has 46 million FTTH connections deployed in Europe, representing what it says is almost a third of connections on the continent. Orange plans to strengthen its customer experience for its core businesses with the use of data and artificial intelligence.
In addition to fiber and 5G, Orange has partnered with Eutelsat to reach the most rural areas in mainland France with an enhanced satellite broadband service under its own brand.
2 - Capitalizing on infrastructure in all the countries where the Orange Group is active.
Across the fixed-line network, Orange plans to deploy 5 million additional fiber connections in Europe, where peak investment has already been reached, and 2 million connections in the MEA region by 2025.
Across its mobile network, Orange intends to get more value from its tower assets by increasing its third-party operator hosting rate from 1.37 users per site in 2022 to 1.5 users per site by 2026.
Orange will decommission its copper network in France and 2G and 3G networks in all its European countries by 2030. In Africa, Orange will continue to deploy fixed and mobile networks (4G and 5G).
3 - Transforming Orange Business Services.
With Lead the Future, Orange is transforming its business services model because it says the boundaries between networks and digital services are disappearing. It will rename Orange Business Services to become Orange Business.
“This ambitious and demanding transformation plan will enable Orange Business to return to growth in profitability by 2025 at the latest,” stated the company's announcement.
Orange has set itself the objective of becoming a European leader in the cybersecurity sector and is targeting revenues of €1.3 billion ($1.39 billion) by 2025. To achieve this, Orange Cyberdefense will continue with its organic growth and a strategy of targeted acquisitions.
4 - Continuing to grow in Africa and the Middle East.
The Orange Group has set a goal of achieving average annual revenue growth of 7% between 2022 and 2025 in Africa and the Middle East.
In addition to network services, Orange will accelerate its Orange Money platform, offering other services in addition to transfers and payments. The company said that at the end of 2022, Orange Money’s revenues had returned to growth, driven by the increase in its customer base to more than 29 million active users and over €100 billion worth of transactions during the year.