Orange's three-year plan to weather downturn

Having announced satisfactory results for its mobile division, France Telecom (FT) has unveiled a three-year strategy for Orange that aims to reduce costs and investments, while keeping the group's annual cashflow from now until the end of 2012 equivalent to the €8 billion ($10 billion) it generated in 2008.

FT said Orange had performed well by adding over 11 million new subscribers, bringing the total to nearly 122 million. Of interest was the increase in mobile broadband users, rising to 26.7 million, compared with 15.7 million at the end of December 2007--a 70% increase.

But to keep the ship steady over the next three years, FT has detailed a three-point plan for Orange Group:

- Simplifying the customer experience - improve customers' understanding of new technologies, by making retail designs and marketing material simpler, simplifying product usage, and creating a dedicated design and ergonomics team to improve call center procedures;

- Enhancing the agility with which the group carries out its business--rationalize the offers so as to accelerate the time to market and focus on new opportunities;

- Ensuring performance that is durable over time--further sharing of networks, information systems and platforms.

FT also piled more tasks onto the Orange management team asking them to go after new growth markets in content and online advertising, as well as improving the interactivity and personalization, and the ability to deploy multi-screen services across TV, PCs and mobiles.

All of this is to be achieved at the same time as Orange is being required to cut costs and investments by €1.5 billion annually until 2012.