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French telecom company, Orange, eyeing entry into Nigeria

Orange eyes Nigeria, South Africa as possible new markets.

Orange, France’s largest telecom operator, believes it would benefit from having a wider footprint in Africa and will give itself a few months to make a possible move, Chief Executive Stephane Richard said in an interview,

“It could make sense to be in economies such as Nigeria and South Africa,” Richard was quoted as saying. “If one considers there are things to do, the time frame I am considering is rather a few months than a few years.”

The Middle East and Africa, where Orange has a presence in 18 countries, is the company’s fastest-growing market.

The region makes a large chunk of its revenues from payment transfers - a key part of the group’s diversification into financial services.

In 2017, when Etisalat Nigeria (now 9mobile) fell into financial crisis, Orange was among the supposed investors looking to swoop into the Nigerian market by purchasing a 65% stake in Etisalat Nigeria.

Orange could either seek a fresh entry, or it could acquire the licence of any of the existing telcos. Airtel, for example, acquired a licence that had been passed down from several telcos, starting from Nigeria Econet in 2001.

Regardless of its entry mode, Orange could bring fresh competition to Nigeria’s telecom sector. This as the case in 2008 when Etisalat stormed the market with relatively cheap tariffs.

The competition could also extend to the payments sector. With over 40 million mobile money users, Orange seems to be making huge revenues from its financial services arm in its current markets, and its expansion plans might be with an eye on the growing payment sector in Nigeria.

West Africa has been gradually overtaking East Africa in the growth rate of mobile money and some telcos have either already launched theirs, or are in the process of doing so in Nigeria.

 

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