Orange launches its towerco, stressing how independent it is

French operator group Orange has placed its passive infrastructure assets into a new company called Totem so it can flog access to other telcos.

Totem is capitalized by Orange but, since it doesn’t seem to be an acronym, we don’t see the point, especially since it requires slightly more typing effort. Orange has been banging on about it since the start of the year but hasn’t reached the number of sites it had previously hoped to. Totem France will manage 18,500 macro-sites with a mix of 58% tower sites, 30% flat roofs and 12% in other locations, while Totem Spain has 7,900 macro-sites, distributed equally between towers and roofs.

“Totem’s operational launch is an important milestone in our European infrastructure strategy,” said Stéphane Richard, Chairman and CEO of Orange. “The creation of this entity will allow us to derive value from our passive mobile infrastructure, for which we have exceptional operational expertise.

“By opening up these assets to other operators, we will optimize its use. We are determined to support Totem on both a strategic and financial level, to make it an undisputed leader on the European market and to keep control of this strategic asset as part of a long-term industrial vision. By retaining control of our infrastructure, we have made a crucial decision for our future growth.”

Richard seems to be trying to have his cake and eat it too with this move. On one hand he talks about and independent towerco that he hopes will be attractive to Orange’s direct competitors, on the other he celebrates retaining control of it. He’s going to have to do better than that if he wants to convince other operators Orange won’t get preferential treatment at these sites.

“Launched first in France and Spain, Totem has become a new player for regional development in Europe,” said Nicolas Roy, Totam CEO. “Totem will create value for all stakeholders – operators, landlords and real estate players, regional authorities, companies – thanks to its connectivity solutions and equipment sharing.”

There will presumably be all kinds of SLAs, Ts & Cs, etc, but the question still remains of why an operator looking for a European towerco shouldn’t go for a truly neutral one like Cellnex. Orange can spin off assets into new companies all it wants, but so long at Roy reports into Richard, his first priority will surely be to keep his boss happy.