Innovation through transformation

By Isabelle Paradis
President, HOT TELECOM
November 2014

Orange has now climbed into second position in the ranking of International Wholesale Voice providers in terms of traffic and is also a leader in mobile data roaming and signalling. I had the chance to discuss this achievement with Alexandre Pebéreau, CEO Orange International Carriers USA as well as how Orange is succeeding in differentiating itself from the pack through quality, efficiency, agility and innovation.


What wholesale trends will have the greatest impact over the next few years?
There are three key trends transforming the wholesale industry at the moment and impacting our business: IP, Quality and Fraud prevention. Obviously, the first one and most important is the migration to IP, which is transforming the industry from top to bottom. Further than that, quality is becoming an axis of differentiation for a growing number of wholesalers, including Orange, as we have our group’s retail customers in mind. Positioning vis-à-vis quality is definitely the second big trend impacting how carriers do business at the moment.

Finally, maybe more from an Orange point of view, the third trend of importance is everything to do with the fight against fraud. Wholesalers can have a direct impact on fraud and must take advantage of this unique position to help their customers increase and protect their revenue.

On that front, Orange is developing new algorithms and tools to detect fraud and find its source, which means developing new systems which can learn by themselves based on fraud occurrence throughout the global network. And this completely changes the relationship between wholesalers and their customers. From an Orange perspective, maybe I would like to add a fourth trend or perhaps I should call it an opportunity, and this is the liberalisation of mobile payment and mobile banking in Europe, opening payment management to telecom operators. Consequently, under these new regulations, telcos are now authorized to organize the payment over mobile devices, making full use of the IP technology which made it possible. And this is a perfect application to put over a secure, quality guaranteed platform such as IPX.


Orange has the benefit of being part a mobile group and of being able to capitalize on its mobile operator members to build its IPX footprint. Do you think there is still a space for pure wholesalers in the industry?
The large mobile groups, such as Orange, have identified International interconnection as a source not only of profit, but of efficiency and agility and we can add great value to the group. Orange is not the first one to build such an international carrier business unit but we are not the last one either, as this trend is picking up in pace. This said, we have 60% of our business which is conducted with third parties, outside of the Orange group, so we are also a wholesaler for others.

But ultimately, the aim of large mobile or retail groups is to interconnect directly between each other, increasing efficiency and profitability of the interconnections, and to complement these direct relations with interconnects with large wholesalers such as Tata Communications and BICS for example.

But I think some of the smaller groups will still look at outsourcing their International business to large wholesalers, as the level of expertise required to run their International arm is high and the CAPEX needed to keep this type of unit at the forefront of the competition is constantly growing. So this will contribute to a level of consolidation in the wholesale market in the next 5 to 10 years.


How does Orange Carriers Services approach innovation?
ince we are a young business (we were created as a separate business unit only 4 years ago), we had to invent everything. It is one thing to have experts in the international carrier area, but it is another thing to ask them to generate revenue through their work. And this is one of the ways we innovate at Orange, by changing our processes and organisation to focus each individual on revenue generation. This is an obvious thing to say as a private company, but it is not that easy to turn into reality.

So to achieve this, we had to be innovative in the way we are organised and the way we coordinate our activities. We re-organized people, traditionally used to working in silos by expertise, to give them responsibilities for a destination from start to finish. We turned our people into destination experts, which at the end of the day enabled them to serve customers better, work more efficiently and at the same time generate more revenue for the company.

These destination experts have to master not only the routing, the marketing and the context of each destination, but also the pricing and last but not least the quality of the route. So we completely reinvented ourselves and for us that was a major innovation.


What in your opinion will be the biggest challenge for the wholesale industry in the coming years and how should wholesalers tackle it?
Finally, as the real challenge is the OTT and the new world, we have to defend our business. To achieve this, at Orange we believe that the industry has to work together in the same direction, rather than be insular and solitary, and this is a value that we want to promote. So if carriers need help in growing their business, they will find it within Orange. This is what we call the sense of the community!

About the Author:

Isabelle Paradis

Isabelle Paradis, President of HOT TELECOM is an international telecoms expert, with over 20 years working experience in the Americas, Europe, Asia and Africa.

HOT TELECOM has been serving global operators, governments, equipment vendors and telecom investors for over 11 years, providing leading edge market research and consulting services to industry leaders around the globe.

For more information on our HOT INTERVIEWS program, please contact Isabelle Paradis at: or at +1 514 270 1636