The announcement of French multinational Orange's partnership with Nashua Mobile has been met with cautious optimism by industry analysts, who say the move ultimately amounts to a precursor step in the course of the company's long-term local strategy.
Six months after announcing its plans to ripen its presence in the local consumer telecommunications market, Orange yesterday revealed it had partnered with one of SA's largest independent telecoms service providers to open physical retail arms across the country.
IDC analyst Spiwe Chireka says she sees the move as Orange using Nashua Mobile - a well-known local brand with 150 outlets across SA - to tentatively grow its own brand among South African consumers.
"This is not a bad move, partnering with a strong brand like Nashua Mobile, but for now I think they are planning on taking their time to slowly grow their brand presence - so that when and if they launch their own network, people won't be asking 'who are they?' It looks like Orange is using Nashua primarily as a channel to market."
While SA is yet to see tangible services coming from the French operator, "it is not to say that this move will not work".
MVNO motion
There are two ways new companies enter the market, says Chireka. "You can either come into a market and grow as you get more customers - or you can come in and spend two or three years growing your distribution channels, brand presence, etc." She says Orange has opted for the latter option, and is laying a foundation for what the industry anticipates will be another mobile virtual network operator (MVNO).
Orange Horizons MD S'ebastien Crozier has made it clear that the company would like to launch as a competitor to SA's incumbent operators - but says it will take time as "[Orange] does not want to be just a brand service provider".
If Orange is to launch as an MVNO in SA, says Crozier, the company will need stable and decisive regulation. "It is not a question of our ability to launch. We can, but we need good regulations. When we have everything we need in place we will launch, but for now the partnership with Nashua Mobile is our focus."
Chireka says this is a "good start" on Orange's part. "Kudos to Orange for taking their time and seeing how they can differentiate themselves in the market. Now let's see what is next. I believe they will switch on [network services] eventually."
SA boon
World Wide Worx MD Arthur Goldstuck speaks of the unique vantage point for South African consumers in terms of the telecoms travel products Orange has brought to the market.
He says the partnership with Nashua Mobile was a bit of an unexpected move. "I am amazed the industry hasn't done more [in the line of telecoms products for travellers]."
Goldstuck says Orange's products provide a "much needed service" - especially for South African travellers visiting other countries. "It is the bane of their lives, trying to find a decent prepaid answer to their roaming needs."
While he concedes the company's inaugural move - which for now only includes products aimed at Botswana and France - does not entirely meet travellers' telecoms needs, it "certainly solves the problem of data roaming and making calls in other countries".
The expectation is that Orange will roll out similar services to a range of other countries in due course, says Goldstuck. Crozier has confirmed he will be back in SA next month to coordinate the addition of other Orange countries ("and to prepare for the launch of new products"), and says the process will happen sooner rather than later.
Crozier mentions Mauritius, Kenya, the UK and Spain as possible additions to the current duo of countries in Orange's fledgling product portfolio.
Goldstuck says Mauritius is a good example of where a service of this nature would be valuable. "If you go to Mauritius, the best deal for 3G is Orange's services - but it is so difficult to find and set up. If a traveller was able to purchase and set up their services locally, it would mean they wouldn't need to spend an inordinate amount of time over there doing it."
The choice of a developing country like Botswana and a first world country like France represents a balance of markets, Goldstuck says - "but the South African part of the equation will really be the proof of concept for the company going forward".
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