Orange, the internet and mobile phone arm of France Télécom, is seeing revenue growth in emerging markets. But in its mature markets – France, the UK and Spain – the picture is not so good. In 2006, average revenue per user (ARPU) was down and revenue gains were slim. Orange has been hit with higher operational costs in these markets due to intense competition, rebranding, and the cost of launching converged services.

Orange’s most difficult market last year was the UK, where the operator had flat revenues. But Orange says that early sales in the first quarter of 2007 indicate that churn could be slowing down and its agreement with Vodafone to share 3G radio access networks will also help to reduce operational costs.

Like other European telecoms companies, France Télécom is seeking new revenue sources to compensate for falling prices in telephony and internet access, and lost business as telephony migrates to the internet. And so Orange is launching a music version of YouTube, which follows the launch of Pikeo, an Orange photo-posting site, last autumn.

Orange Business Services in the UK has deployed Cult Hill Innovation’s Tariff Review Service Solution, enabling it to analyse each of its customer’s usage patterns online and recommend the most suitable tariff plan for them.

The system is expected to lead to much higher customer satisfaction, lower call centre costs and a significant reduction in customer churn.