BARCELONA, Spain--Orange is taking a chance by launching a new $40 (€35) smartphone and data package for the Middle East and Africa markets, according to Marc Rennard, the operator's EVP International for Africa, the Middle East and Asia.
Marc Rennard told FierceWireless:Europe the new package, announced here at Mobile World Congress, reaffirms Orange's commitment to emerging markets, and that the company believes the concept will work, based on the initial reaction of its affiliate companies, which are clamouring to launch the package. "It's the first positive thing…that there is an interest in the local affiliates," Rennard noted, explaining that Orange's affiliate companies are "closer to the market."
However, while Rennard said he is sure the company will succeed with the new package, he conceded that "perhaps I will be wrong."
The company is gearing up to launch the package in 13 MEA territories in the second quarter. The package includes a 3G smartphone produced by Alcatel One Touch, voice, SMS, and data airtime.
Despite the admission he could be wrong, Rennard said he expects the company will "sell a lot" of the packages and, at the very least, create a positive image of Orange.
Price is the key element in Rennard's confidence. "In emerging countries…you have the high value customers…who can buy an iPhone. And you have the bottom of the pyramid who…cannot pay $200 or $300" for a device, Rennard explained, adding: "In emerging countries, $300 is not the right price because you don't have a significant middle class."
Orange's $40 smartphone and data offering delivers "significant Internet" access to users in emerging markets, "not only Internet with 2G, with EDGE, with limited capabilities. You need to improve the situation," Rennard noted.
The Orange executive conceded that his view in the past was not centred on handsets and devices, because there was a network of independent device retailers and a well-established grey market. However, today Rennard said the operator must provide an "affordable solution with the handset" to increase usage of mobile Internet, and Orange's 3G networks in particular.
Rennard also provided an update on an Orange reorganisation of its structure that will see 20 affiliate companies that were previously run through six holding companies brought under a common umbrella company. "[W]e are working hard on this topic, and the target is to finish this process end of June. I think…we'll do it a bit before, two weeks before. So we are on track," he noted.
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