In Q3, Orange Polska proved its potential on the Polish telco market

This was the best quarter in two years for our postpaid consumer mobile segment, our convergent potential is growing systematically, and fiber internet proves to be the powertrain of Orange Polska’s transition. Thanks to welcoming BlueSoft to Orange group, we’re stronger on the B2B market. With recent deregulation of subsequent local broadband markets and 5G on the horizon, we’re focused on grasping those growth opportunities.

If I was to wrap up Orange’s performance in the past months, I’d simply say: by betting on new services and bundles based on high-quality fiber network, we made the right choice.

In the beginning of October Orange ?wiat?owód reached 4 million houses and flats throughout Poland. It means that our fiber network is available to almost 30% of all Polish households. We see that customers appreciate the benefits of super-fast internet and are willing to opt for it. In the last quarter alone, 39 thousand new customers have chosen our fiber. We are all the more happy because this market is highly competitive. In this context, we welcome the decision of UKE to extend deregulation to new municipalities in Poland, which gives us the opportunity to more effectively compete with the quality and attractiveness of services. This is good news for customers and the market. Previous deregulation, launched in 2014, prompted the development of this superfast internet network in Poland. Since 2015, Orange alone has invested more than PLN 2.6 bn in rolling out optical fiber. The results that we see prove that this was a smart choice. Today, Orange Polska’s pure fiber network reaches more households than the whole cable network of our largest cable competitor. Still, 85% of fiber customers come to Orange from the market – a number that stayed on a similar level for many quarters now. We are happy that the saturation of Orange ?wiat?owód is steadily growing, now at 12%, still it means that we have the potential to further monetize this network on the operators’ market. In the past quarter one of our competitors launched commercial sales of services based on our network – and believe me when I say that it makes me happy to see the word ‘?wiat?owód’ more and more in the public space.  

As for convergence, during yesterday’s call with investors I was asked: why does convergence grow slower? The answer is: the base is evolving. This is a healthy growth. We have migrated most of our mono customer base. In the end of September, 61% of all our broadband customers had our flagship Orange Love bundles (versus 55% a year ago). In the case of mobile customer, it was 49% (versus 45 in Q3 2018). Now, more and more we are building what we call ‘new new’ base – meaning that more and more convergent customers come to us from the market. This is an important development for us. Please bear in mind that in the past 9 months we have introduced two key changes in our convergent offers in line with the More for More strategy: new, more high-end packages with the most extensive TV offer on the market and new pricing on existing bundles. It is still too early to clearly evaluate those two moves, but the initial response from the market and customers is rather good. As a result of those value-accretive actions, this quarter we saw an increase in ARPO. Revenues from convergent offers grew by 19% year on year.

Last but not least – our B2B teams keep doing a great job. For the first time we’ve consolidated BlueSoft results, an IT company that joined Orange Polska group in June. It boosted the results, but even excluding the effect of BlueSoft – our revenues from the IT&integrated services market grew by 27% year on year. We’re happy that Polish companies choose Orange to be their partner for digital transformation. Which brings me to the most important topic that’s ahead – 5G.

5G will be the most important event on the Polish telco market in 2020. The regulatory office already announced that they’re planning the main spectrum – that is 3.4-3.8 MHz – auction in the very beginning of the year. Orange Polska has been preparing for this evolution in mobile network for many months now. We were the first in the country to conduct lab and field trials, including the ongoing live 5G tests with our individual and business customers in Warsaw and Lublin. We’re working with all major equipment suppliers and Polish authorities to make sure that we are ready for this transition.

There are exciting things ahead, so stay tuned!