Orange focuses on big spenders

MOBILE phones company Orange will concentrate in the UK on attracting and retaining business and high-spending contract clients to 'extract more value from the market' and is prepared to lose other customers.

Responding to analyst concerns the company's UK market share is slipping, John Allwood, executive vice-president in charge of UK operations, said: 'Our strategy is concentrating more on value than on pure customer numbers.'

Orange is owned by France Telecom. Its chief financial officer Michel Combes said the UK market share is little changed from a year ago when stripping out the effect of new arrival, 3.

'Similar to (the company's strategy in) France we are concentrating on keeping churn as low as possible... We have the best churn in the UK market,' said Allwood.

'By concentrating on the best segments of the market we will extract more value as opposed to going across the whole market... but that does mean that we will concentrate less on other segments where there isn't as much value.

'It's not just about total customer numbers.'

He contrasted this with the strategy of rivals MM02's O2 and 3 to 'be out there buying customers'.

Total churn in the UK in first-half 2004 widened to 26.1% from 19.9% a year earlier, compared to a French churn of 18.6% in the first half, down from 20.4%.

Among contract customers, churn in the UK was 23.2%, up from 22.7%. The company's annual ARPU is currently at £274, up from £267 a year earlier, and contract ARPU is a market leading £577, up from £568.