By ADEBAYO OBAJEMU
France’s largest telecom company, Orange, has indicated intention to invest in Africa, namely Nigeria and South Africa. “I can tell you Orange will change the telecom landscape in Nigeria, deepens the stiff competition to the advantage of subscribers. What we should know is that the French company is one of the largest, most efficient telecom companies in the world”, was the reaction of Mr. Wale Saliu telecom analyst and Managing Director of Walex Computers , when asked by BusinessHallmark to react to news of planned foray into Nigeria by Orange.
As the telecom company eyes Nigerian market, analysts believe it will shake the existing firms out of their complacency, and the end result will be a plus for subscribers who will have options to go for the most efficient.
Idowu Olorunleke, an analyst with Telecom Watch told this newspaper that “because of poor regulation and oversight by the Nigeria Communications Commission, NCC, a lot of irresponsible behaviour by these telecom companies are not checked, the relevant agency should use the plan by Orange to come to the Nigerian market to overhaul the existing regulation with a view to protecting subscribers and offering quality service.”
Most of the analysts spoken to say France’s Orange is more than capable of taking over the Nigerian market with over 266 million customers worldwide. According to reports Orange is looking to widen its footprint in Africa by establishing a presence in these countries but this might take a few months.
Orange is France’s largest telecom and is said to have big imprints across the globe. It has a measure of its portfolio in the Middle East and Africa – 18 countries – and according to a recent survey, the French telco has fastest-growing market, until now, it has yet to make a confirmed move to enter the region’s biggest market.
Recall that Orange had previously been linked with the acquisition of some telco units across Africa, notably in 2016, when it acquired four of Airtel’s units in Africa. The current expression of interest will be the first time it is making any play for South Africa’s telecom market, though it had previously made investments in eCommerce, WiFi access and business services.
In 2016, the telecom giant invested €75 million (₦32.7 billion or ZAR 1.45 billion) in African Internet Group (Jumia). BusinessHallmark can establish that this is not the first time Orange has reportedly shown interest in Nigeria.
We recall that in 2017, when Etisalat Nigeria (now 9mobile) came to financial difficulties, Orange was among the supposed investors waiting in the wings to wrangle its way into the Nigerian market by buying a 65% stake in Etisalat Nigeria. Now the option left for the French telco giant is to either seek a fresh entry, or it could acquire the licence of any of the existing telcos.
A good model was the case of Airtel, which acquired a licence that had been bequeathed down from several telcos, starting from Nigeria Econet in 2001.
What is important for the country’s telecommunication market is not even the mode of entry, but the refreshing fact that Orange could bring fresh competition to Nigeria’s telecom sector. It was the case in 2008 when Etisalat stormed the market with relatively cheap tariffs.
The competition could also extend to the payments sector. With over 40 million mobile money users, Orange seems to be making huge revenues from its financial services arm in its current markets, and its expansion plans might be with an eye on the growing payment sector in Nigeria.
West Africa has been gradually overtaking East Africa in the growth rate of mobile money and some telcos have either already launched theirs, or are in the process of doing so in Nigeria. Although how and when these entries will take place is still anyone’s guess, it is important to acknowledge Orange’s involvement in the acquisition of some telco units across Africa.
From its record across the globe, it is pertinent to note that Orange is more than capable of taking over the Nigerian market with over 266 million customers worldwide, and 89,000 employees in France and 59,000 employees in other parts of the world where its operations are situated.
It is also, the tenth-largest mobile network operator in the world and the fourth largest in Europe after Vodafone, Telefónica, and Veon.
The payments space could also see a significant impact. With over 40 million mobile money users, Orange seems to be making huge revenues from its financial services arm in its current markets. Nigeria has a consistently growing market space and this expansion plans may be with that as the target.
Though there’s not much information detailing the shift, for now, competition might inject new life to Nigeria’s telecom market and possibly fuel the adoption of mobile money.