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Is wireless better in Europe?
If you live in the United States and have used your cell phone on a European holiday, it's very likely you became acquainted with Orange. I'm not talking about the color or the fruit, but rather the cell phone carrier.
Incorporated in 1994 and now a division of France Telecom, Orange is the fifth largest telecom operator in the world with both wireless and fixed data networks. That's not a small feat by any means, particularly when you consider that the company employs 166,384 people and serves 182 million customers in 32 countries. What's more, it also serves as a roaming partner for U.S. GSM carriers.
Up until this week, the main thing I knew about Orange was that it was the debut iPhone carrier in France. On Wednesday, however, I had the opportunity to talk with Olaf Swantee, Orange's executive vice president of operations for Europe and sourcing. Born in the Netherlands, but now with a home in Switzerland and an office in London, Swantee oversees Orange's business in 11 countries in Europe and the Caribbean. Swantee was candid and informative as we discussed wireless growth in developing countries and whether cell phone networks in Europe really are that much better than in the United States.
Q: What is your business focused on right now? A: It's much more about retention than acquiring new customers. First, we're focusing on after-sales services like customer care to make sure that our existing customers stay with us and spend more money with us.
The second key leader is efficiency. In mature markets you need to spend much more time defining the "how" than the "what." It's not so much about reducing costs, but about doing things better.
The third thing is new services. We really try to take our "people interface" really seriously. We want to make sure that our 90,000 employees working in call centers and in shops are installing things for the customer. We're helping people use their phones after they buy them.
That interface is the point of our differentiation, but it can't be just for free. This is something that operators are not used to. Mostly, they include [services and features] as part of a bundle or a package. In contrast, we're saying that there is a lot that's part of a bundle, but if you want something specific, you pay a small amount. We turn that interface into a profit center.
Q: A popular notion in the United States is that this market is behind Europe in wireless use and adoption. What do you think the differences between the two regions really are? A: There are a few things. To start, the networks [in] the Europe and the U.S. are different. Most of the time it's CDMA technology [in the United States], but [Europe] has networks built around GSM technologies like HSUPA and HSDPA. Our advantage in Europe is that those technologies scale a little bit better. So we don't need to have LTE tomorrow morning.
In the United States, [LTE] is a much bigger priority because the current networks are not sufficient to cope with the data growth. That's an important difference. We can do with twice and three times the growth right now. It's fascinating that even in small countries like Armenia, where the GDP per head is a tenth of what it is in the United States, data use is 40 percent of our revenue.… Read more
