Orange Business Services (Orange) Analyst Event July 2020

Orange Business Services (Orange) Industry Analyst Event Introduces the ‘Digital Dexterity’ Theme; Main Priorities Include Digital & Data, Smart Mobility, Cloud & Cyber-security 

Summary

Orange Business Services organized its first fully virtual industry analyst event ‘Analyst Day 2020 – Digital dexterity for new value creation’ during July 8 and 9, 2020. The company leveraged an online Webinar platform to brief the analyst community on its performance during 2019 and strategy and road-map looking forward within the context of the Orange Group Engage 2025 program.

In terms of a first effort for a virtual event Orange organized and ran the series of plenary presentations and breakouts very effectively. There was good access to the executive team for Q&A, the sessions ran to schedule, and there were no technical glitches experienced (at least not by this analyst!).

2019 - a Year in Review

Orange Business Services grew its overall revenue during 2019 by +1% to achieve €7.8 billion compared with the previous year 2018. During the course of 2019, Orange focused on its core network assets business, as well as four specific growth domains, namely:

• Digital & Data
• Smart Mobility Services
• Cloud
• Cyber-security

Orange Business Services  reports the following professional staffing numbers and data centre assets worldwide:

• Cloud – 2,400 experts, 70 datacentres around the world
• AI and digital data experts - 3,900 experts
• Cyber-security – 2,100 cyber-defence experts
• Smart mobility services – 750 design, development and integration experts

Looking forward Orange  intends to focus on being a ‘network-native’ service provider, and grow its business in cloud and managed SD-WAN, with the latter service area extending deeper into the customers’ locations via a managed SD-LAN push in partnership with Cisco. In early July 2020, Cisco announced its ‘SD Access’ solution initiative. Cisco SD Access leverages three main components: a controller-based architecture; network fabric; and programmable infrastructure. Cisco states that the service gives better visibility and performance-control for LAN-based devices. It achieves this by defining and applying group-based access policies, network segmentation for traffic isolation, integrated security and threat protection, and policy consistency from users to applications.

Orange Group Engage 2025 Program
The ‘Engage 2025’ model is about reinventing the operator model.  Engage 2025 is also about co-creation for a future proof company and delivering global digital equality. Orange Business Services is shaping its strategy in accordance with the Group level objective of concentrating on AI and data as focal points for innovation.
The Orange Group sees the B2B opportunity as strategically important with good potential, and aims to back the Orange Business Services business unit to accelerate growth. Additional areas that the Orange Group aims to support and achieve accelerated growth include the Africa/Mid-East region; and mobile financial services.
Sustainable growth for the Orange Business Services B2B activity will see priority development in the following product and service areas:

• SD-WAN
• Smart Mobility Services, which includes IoT, Mobility and 5G Workspace
• Edge computing
• Trusted digital foundations

Future Roadmap & Strategic Directions

• Digital consumption models will be developed to give on-demand and pay as you go commercial flexibility.
• The company aims to develop and offer more cloud-native products. The above areas are seen as sustainable business models for the future of Orange.

Integration and Services
Orange’s Multisourcing Integration (MSI) program has made strong progress in the market, and the company intends to grow its pipeline and capabilities. Consulting is also an area where the service provider expects growth, and it has strong credentials in terms of qualified and experience professionals to help deliver.

Operational Technology (OT) is an area that Orange believes it can capitalize upon, especially as manufacturers migrate towards Industry 4.0, as well as other opportunities in Smart Mobility (connected car, smart city, etc.). Orange is in a strong existing position to bolster its OT position, leveraging existing market entrenchment in IIoT and cellular connectivity solutions, and proven skill-sets and consulting expertise.

Orange Business Services has grown its MSI business very successfully and Clavem Research believes the ambition to further grow the MSI pipeline is highly feasible. However Orange  will face increasing competition from large SIs, as well as other telcos and market disruptors.

HPE for example now has a strong SD-WAN capability through its acquisition of Silver Peak, which will increase the competitive pressure on Orange in the network integration segment. The combination of Aruba and Silver Peak within HPE gives the MNC segment attractive integrated network and cloud transformation options including edge-to-cloud networking for wired, wireless LAN and WAN connectivity.

Orange can highlight its network assets as a differentiator.

Meanwhile other providers such as Cato Networks are making aggressive plays on SASE. Aryaka is flexing its muscles with partnerships: including cooperation with 8x8 to offer UC, a new agreement with Check Point for integrated security with SD-WAN-as-a-Service, and a relationship with Alibaba Cloud giving access to new markets in China and internationally.

Covid-19 Highlights
Orange Business Services did not pause in its activities to provide and support its customers when most of Europe and other parts of the world were in lock-down. Moreover, Orange did not furlough any staff. Ongoing business continuity was an objective from the outset, whilst Orange Healthcare and mobility solutions and AI/data skill-sets proved to be very important to help control the impact of the pandemic.
Orange Business Services took positive initiative to add capacity to its network to support the new dynamic of remote working (WFH – work from home) as well as upgrading and strengthening bot security and cloud platforms.

Looking forward, Orange thinks that the virus will change the way we do business and in response it will focus on the following areas to deliver service to clients in the post-Covid-19 world:

Analyst Opinion

• Smart Mobility Services – Orange can build upon its market entrenchment in smart mobility, based on land and expand strategies for its current base of 19 million connected devices; which includes customers for Industry 4.0, Connected Cars, Smart Cities and Smart Buildings projects.
• ‘Low Touch-High Care’ – In response to the global Covid-19 virus pandemic, Orange Business Services made sure it could support new and rapidly changing requirements for its clients. The first step was moving quickly to boost capacities for large scale remote work video collaboration. Examples of other initiatives enacted at speed on behalf of customers include Orange’s moving quickly to support 6,600 new Web conferencing users for Audi; enabled 15,000 Heineken staff enabled to work from home, and launched a Chatbox to EU government administrators to support queries for efficient home working. Orange  proved itself to be nimble and fast-responding to these new dynamics for large scale and globally distributed companies. The experience gained will reinforce Orange Business Services’ sales messages, consulting, MSI and solutions moving forward as the world learns and adapts to doing business in new social distancing and quarantine demands.
• Strong Opportunity with Orange Business Services and Cisco Cooperation to Develop SD-LAN – Orange has correctly recognized that the explosion of connected ‘things’ makes LAN administration highly complex and prone to problems for support staff. Extending the benefits of SDN-based central orchestration deeper in the LAN environment will drive Orange’s value deeper into clients, promote loyalty and reveal new cross and up-sell opportunities. It is well known that LAN Wi-Fi challenges can occupy IT teams’ time even for fairly basic issues. Having intelligence down to device level and a programmable network gives Orange/Cisco a strong position in the market. Orange can seek to apply AI to help with troubleshooting LAN problems, and give first level ML-based support to solving the more simple to fix issues (e.g., Wi-Fi router mis-configuration and reboot, or password reset).