France Telecom to expand in African mobile markets

Telecom Lead Africa: France Telecom is planning to expand its presence in African mobile markets by entering Benin, Togo, Burkina Faso and Mauritania.

Elie Girard, the group’s head of strategy and development, said plans for Africa also included seeking to sign management contracts with telecom groups in Libya and Algeria.


He said no talks on acquisitions were currently underway, but Africa and the Middle East were a priority for growth.

“If we manage to enter Benin, Togo, Burkina (Faso) and Mauritania, for example, that would be very valuable for us. The countries’ proximity to Orange’s existing operations in Mali and Senegal made them more attractive,” he told reporters at a briefing in London.

Recently, Analysys Mason said telecoms revenue in the Middle East and North Africa (MENA) is expected to grow by 27 percent between 2012 and 2017, at a compound annual growth rate (CAGR) of 5 percent.

Telecom revenue will increase from $70.3 billion in 2011 to $96.4 billion in 2017. Fastest growth area during the forecast period will be mobile data services, with handset data revenue set to grow at a CAGR of 17.9 percent between 2012 and 2017.

However, growth rates in subscriber numbers will continue to decline, as will mobile voice prices.

According to Gartner, IT spending in Europe, the Middle East and Africa (EMEA) will reach $1.154 trillion in 2013, a 1.4 percent increase from 2012 projected spending of $1.138 trillion.

Gartner estimates that spending on mobile devices (notebook PCs, mobile phones, ultramobiles and tablets) in EMEA will amount to $136 billion in 2012, reaching $188 billion in 2016. In Eastern Europe and the Middle East and Africa, mobile phone shipments will dominate the market, with tablet adoption increasing through to 2016.

France Telecom markets its services under the brand Orange and operates in 21 Middle East and African countries.

Orange is the third-largest mobile operator in the region, behind South Africa’s MTN and Britain’s Vodafone.

A presence in Benin would improve a link between the company’s network in Niger and the submarine cables that carry Internet traffic between Africa and the world.

France Telecom wanted to expand into Libya, Algeria and Ethiopia, and would seek contracts to manage other operators’ telecom networks as a way to get a foot in the door.

“There are two operators in Libya today and there is a tender for management contracts and we are working hard to get one of those. Algeria as a large, underdeveloped market was also strategically interesting, but any progress would be slow,” he added.

France Telecom has set a target to double its turnover in emerging markets to 7 billion euros by 2015, and has said it is on track to reach that after making acquisitions in Morocco, Tunisia, and Iraq in the past two years.

At the end of 2011, it had 14 million customers in Africa and the Middle East, according to its annual report.

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