Posted on September 23, 2022 at 4:21 PMUpdated on September 23, 2022 at 4:48 pm
Nicolas Guérin, the general secretary of Orange, did not get there by four ways. As all the major telcos gathered Thursday at the Arab World Institute in Paris for regulator Arcep’s annual “Connected Territories” conference, the group’s main lobbyist took the opportunity to defend the plan to withdraw from the old copper network of Orange. And put the dots on the i’s, with very spot words.
As a reminder, Orange had committed at the end of 2019 to decommissioning its copper network by 2030, with a two-stage plan: commercial closure (no new subscriptions) by 2025, then strict technical closure from 2026. Basically, all players agree. The copper network is not only aging and subject to failure, it is becoming empty of subscribers and doubling up on fiber, which is faster and consumes three times less power.
But SFR, Bouygues and Free believe that Orange is not going fast enough. The longer Orange delays, the longer it will continue to receive unbundling revenue (fees charged by Orange to other operators using its copper network). Competitors also fear that without an official communication from the State to make this change neutral, the incumbent operator will take advantage of this transition to encourage its copper subscribers to migrate to its own fiber and thus increase its fiber market share.
“2030 may seem distant, but it is not. We need this time so that we don’t rush consumers and businesses. You have to take advantage of this time, replies Nicolas Guérin. Our plan is ambitious, concrete, available, with a mapped out route. Technically there will be no problems, except perhaps in the business market”.
2 to 3 billion euros of unamortized value
Specifically, Orange will proceed by geographical area, depending on the availability of fiber, the presence of operators, the local economic fabric, etc. A first batch of 200,000 homes has been identified for commercial closure from the end of 2023 and a second batch of 900,000 is currently being prepared. But the problem is that Orange must remove the copper… while maintaining a certain quality of service, the network is still used by 21 million French people. But on this subject, Orange has no intention of going through the box.
“If you give us quality of service obligations on copper, you finance them! Nicolas Guérin launched in front of the parliamentarians present in the Rafic Hariri auditorium, recalling that the copper network represented “2 to 3 billion euros of unamortized economic value”. “Each year we invest 500 million euros in our copper network and carry out 615,000 interventions. On the other hand, our copper revenues are falling in the tens of millions of euros every year. Orange is a private player, listed on the stock exchange. We are prepared for everything, but we have to solve the economic equation”.
On this issue, it is up to Arcep to decide: the regulator must decide on a possible rise in the unbundling price, as Orange wants. Otherwise, the copper network “will continue to deteriorate”, acknowledged Nicolas Guérin. One thing is certain: the “project of the decade” promises great battles in telecommunications in the coming years.