The second B2B operator behind Orange, SFR Business completes the integration of Completel, Telindus France and Numergy. Which goes through a new business organization.
It was a bit forgotten at the end of a particularly hectic 2015 with its takeover by Altice, Patrick Drahi’s conglomerate, but SFR also has a significant business hub. “We have one million B2B customers worldwide,” said Pascal Rialland, a former boss of the same business at SFR last November. Newly appointed boss of Altice’s B2B hub, the latter will say little about the potential synergies with its various B2B businesses around the world (Portugal Telecom, Orange Dominicana, Hot in Israel, and Suddenlink and Cablevision – two American cable operators recently acquired by Altice).
SFR accounts for 20% of the French BtoB communications market
However, with € 2.2 billion in B2B revenue, SFR accounts for about 20% of the tricolor business communications market (a market valued by Arcep at € 10.1 billion in 2014). With 3,970 employees and 250 “SFR Business Spaces”, its B2B division claims 190,000 client companies, from TPE to CAC 40 companies. Renamed SFR Business in September, the former SFR Business Team has dedicated a large part of 2015 to put itself in order of battle in order to integrate Completel (former B2B division of Numéricable) and Telindus France, an integrator inherited from Vivendi.
With a turnover of around € 350 million, the former Completel is a significant contribution to SFR Business, although the new set had to get rid of Completel’s old DSL business, resold to Kosc Telecom, a consortium, which includes OVH, created to meet the requirements of the Competition Authority. Another contribution is that of Telindus France (approximately 250 million euros in sales), a specialist in the operation of IT infrastructures from Vivendi, which has logically joined the B2B division of the new complex.
Strong of a new commercial organization based on the principle of a single interlocutor for all its offer (fixed, mobile, network services, security, CRM, cloud, M2M, Internet of things, datacenters), Guillaume de Lavallade, SFR Business’s new chief executive since September 2015 and former SFR B2B customer relations manager, considers himself well-equipped to consolidate its number two French position with companies, especially in the fixed – which accounts for two-thirds of activity. “We are ahead of Orange in the number of municipalities for which companies are eligible for fiber optics,” said SFR Business’s Executive Director (1). “We are here [toujours dans la fibre] in 95% of cities with more than 50,000 inhabitants, and 50% of business sites with more than twenty employees are eligible – with a target of 70% by the end of 2017 “, he continues. A way for SFR Business to reaffirm the the group ‘s sometimes controversial commitment to fiber optics (2).
An added value highlighted in business recovery plans
Another differentiating factor: the recovery plans (PRA) of vital operators (OIV) in areas such as energy, transport, sanitation, hospitals or civil security, where telecoms play a crucial role. Same analysis when it comes to cybersecurity. “We have less and less equipment on site and we always focus on our points of presence and our data centers,” says Guillaume de Lavallade.
The integration of Numergy’s offer is underway
In the cloud, the integration of Numergy, following its 100% takeover by SFR, is under the leadership of Guy Roussel, the former boss of the Sovereign Cloud Supervisory Board. A logical recovery in that Numergy relied exclusively on SFR’s servers before its main shareholder (47%) took control. “We are integrating the two portfolios,” confirms Guillaume de Lavallade, noting that SFR will retain an OpenStack offering.
On the distribution side, the operator acts either directly, through its 1,800 sales and its Business Spaces, or through LTI Telecom and Futur, two specialized operators resulting from the acquisition of Completel, now responsible for animating a network of 650 independent partners for SMEs.
SFR Business is still far behind Orange Business Services (OBS), which is credited with more than 60% market share (or even more depending on offers). A dimension that has not escaped the Competition Authority, which, following a lengthy investigation initiated by Bouygues and SFR, has just sentenced Orange to a fine of 350 million euros for “abuse of a dominant position “on the business market.
Takeover of Bouygues Telecom Companies: SFR Business vigilant
A somewhat anachronistic situation since the Authority itself acknowledges that this situation still persists today! This raises the question of the future of Bouygues Telecom Entreprises (which has a turnover of around 600 million euros) in the event of Bouygues Telecom’s merger with Orange. Asked by JDN, SFR Business does not comment specifically, other than to point out the regulatory hurdles it could pose and the need to be extremely vigilant about the already significant weight of OBS in this market. An analysis to reconcile the conditions imposed by the Competition Authority when the acquisition of SFR by Numéricable, Completel being then forced to separate from its DSL network due to a “risk of duopoly with Orange” in certain geographical areas. Not surprisingly, the other B2B players, mainly Bouygues Telecom Entreprises and Colt, are far behind with around 6% and 3% market share, respectively …
(1) 710 communes according to SFR; 480 common for Orange according to Ariase, a site specializing in comparing the offer of telecom operators, quoted by SFR.
(2) Of the order of 2.5 million households connected in FTTH, compared to 5.2 in FTTB, a total of 7.7 millions of households eligible for fiber, all technologies combined, in November 2015, according to SFR.