Telefonica is Spain's main telecoms operator, with an extensive fixed line service at home and in several Latin American markets, as well as three substantial mobile brands in Movistar, operating in 14 Spanish-speaking territories, Vivo in Brazil and O2 in Germany and the UK. The group established its position in the international market through a series of high profile and aggressive deals in the 1990s and 2000s. It became the leading telecoms business in Latin America following the purchase of a clutch of separate operators covering several separate countries across the region, and consolidated that position in 2010 by taking full control of Vivo of Brazil, the region's single biggest mobile service by subscribers. The group has also become a leading force in other European markets through the acquisition of O2, a leading operator in the UK, Germany and other countries. A move into the media business proved less fruitful. During the 1990s, Telefonica acquired stakes in several broadcast and television production companies, and merged its Terra Networks internet business with Lycos of America to form a short-lived online giant. Most of those businesses were later sold or abandoned. Telefonica re-established its media credentials in 2014 by taking control of Spain's leading pay-TV service. Group revenues for 2018 were €48.7bn with net income of just under €4.0bn. Europe as a whole accounted for 55% of revenues and Latin America for 43%. Spain is the most important market by far with revenues of €12.5bn and operating income of €3.1bn. Telefonica is the local leader in mobile, fixed line and now also pay-TV. The latter was previously a joint venture with Grupo Prisa under the name Canal+. Telefonica took control of the business in 2014, and relaunched it as Movistar+. Brazil is the group's #2 market with revenues of €10.1bn and operating income of €2.3bn. Vivo is the leading mobile operator with almost 40% market share. Other Latin American markets - including Argentina, Chile, Peru, Colombia and Mexico - contributed combined revenues of almost €10.8bn. Operations in some smaller Central American markets were sold in 2019. Jose Maria Alvarez-Pallete is group CEO.
Capsule checked 23rd January 2020
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Recent stories from Adbrands Update:
Adbrands Weekly Update 31st Mar 2016: The 70-year-old chairman & CEO of Spanish telecoms giant Telefonica is set to step down later this year. Cesar Alierta has led the company since 2000. Current COO Jose Maria Alvarez-Pallete is almost certain to be his successor. That appointment is to be put before the group's board next week.
Adbrands Weekly Update 23rd Oct 2014: Spanish telecoms giant Telefonica has cancelled a plan announced in July to shift its global media account to Publicis Groupe, and will instead consolidate the business within Havas Media, which had previously managed part of the business. Publicis-owned ZenithOptimedia had been due to take over the business from January 2015. However, circumstances have changed since that appointment was made. Specifically, Telefonica signed a deal to acquire Vivendi's Brazilian telecoms subsidiary GVT... and Vivendi's executive chairman and largest individual shareholder is Vincent Bollore, who is also the controlling shareholder in Havas. It is widely believed that, as a sidebar to the GVT deal, pressure was put on Telefonica to rescind the Publicis appointment and instead park the account at Havas Media.
Adbrands Weekly Update 25th Sept 2014: Telefonica of Spain secured a deal to acquire Brazilian fixed line operator GVT from French group Vivendi for €7.24bn in cash and stock. The agreement allows both groups to achieve key strategic goals. The addition of GVT to its existing Vivo mobile operation in Brazil makes Telefonica the clear leader in that country's telecoms market. Also part of the payment is being made with the transfer of most of Telefonica's controversial shareholding in Telecom Italia to Vivendi. At the same time, Vivendi ends its direct involvement in the telecoms industry, having now divested all but a few minority investments in the sector.
Adbrands Weekly Update 4th Sept 2014: Spanish telecoms group Telefonica looks set to become the market leader in fixed line communications in Brazil, as a result of exclusive talks to acquire competitor GVT, currently a subsidiary of Vivendi of France. If completed that deal would boost Telefonica into the #1 spot by local market share, narrowly ahead of rivals Oi and America Movil. Telefonica is already the market leader in Brazilian mobile through its Vivo unit, but ranks third in fixed line services. It has offered to acquire GVT for €7.45bn.
Adbrands Weekly Update 7th Aug 2014: Telefonica of Spain has offered to acquire French group Vivendi's last remaining telecoms asset, the Brazilian fixed line operator GVT, for €6.7bn in cash and shares. Vivendi originally acquired the business in 2009 following a bidding war with the Spanish operator, but a change of strategy since then has prompted to gradually extricate itself from the telecoms sector - it agreed to sell control of its biggest business, French mobile operator SFR, earlier this year. To sweeten the deal, Telefonica is also proposing a transfer to Vivendi of its minority stake in Telecom Italia. The acquisition of GVT would strengthen the Spanish group's already considerable interests in Brazil, where its mobile service Vivo is the market leader by a large margin.
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