Telefónica

Telefónica is the second largest corporation in Spain, behind the Santander Group.[12] It operates under the movistar and O2 brands with the first being the largest broadband and phone (both mobile and landlines) provider in Spain.

Telefónica's FTTH network in Spain is the most extensive fibre-to-home network in Europe, as of April 2016,[13] and the shut down plan for the legacy copper network is already in progress.[14]

Telefónica was the parent of Telefónica Deutschland, which held two alternative IP carriers. The two ISPs, mediaWays and HighwayOne merged in January 2003 after having been purchased by Telefónica in 2001 and February 2002 respectively.

On 26 January 2006 Telefónica completed its £17.7 billion (€25.7 billion) acquisition of the UK-based operator O2 which also provided mobile phone services in Germany under the O2 brand.[15] Following the purchase, Telefónica merged Telefónica Deutschland and O2 Germany to form the current business Telefónica Germany.

Telefónica Germany, purchased competitor E-Plus on 1 October 2014. As part of the purchase, Telefónica reduced its stake in its subsidiary to 62.1%. Integration continues as of August 2015, but the now merged network is Germany's largest in customers.

On 31 October 2005, O2 agreed to be taken over by Telefónica, with a cash offer of £17.7 billion, or £2 per share.[16] According to the merger announcement, O2, which provided mobile phone services in the UK, Ireland, Germany and the Isle of Man (uniquely to the O2 group Manx Telecom also offered fixed-line services), retained its name and continued to be based in the United Kingdom, keeping both the brand and the management team. The merger became unconditional on 23 January 2006 and O2 became a wholly owned subsidiary of Telefónica. Manx Telecom was sold by Telefónica Europe in June 2010.

In January 2015, Li Ka-shing entered into talks with Telefónica to buy O2 for around £10.25 billion, aiming to merge it with his subsidiary Three.[17] The acquisition was officially blocked by the European Commission on 11 May 2016, which argued that the merger would reduce consumer choice and lead to a higher cost of services [18] Telefónica began to seek a stock market flotation of the business instead.[19]

Announced on the 7th May 2020, Liberty Global owner of Virgin Media and Telefónica owner of O2 have agreed to merge their U.K. businesses in a deal worth £31bn and form one of the UK's largest entertainment and telecommunication companies to rival the BT Group.[20]

In France, since 2011, Telefónica has a joint venture with the French telecommunications company Bouygues Telecom, part of the Bouygues group, to offer global telecommunication services packages to multinational companies. This cooperation was expanded in June 2015 through the creation of a separate joint venture company named Telefónica Global Solutions France, with its own marketing and sales teams offering Telefónica and Bouygues Telecom services packages to corporations.

Telefónica operates the Movistar mobile phone brand throughout Latin America and the Vivo in Brazil. In Mexico it occupies a distant second place and it is the largest in Chile, Venezuela, Brazil, and Peru.

Telefónica owns Telefónica de Argentina which is the largest fixed-line operator in the country. It provides broadband, local and long-distance telephone services in southern part of the country as well as the Greater Buenos Aires area. The Telefónica Group has been in the country since 1990. The mobile business is run by Telefónica Móviles through Movistar, a local subsidiary.

Telefónica's largest fixed-line operation in South America is in Brazil, where it provides broadband, local and long-distance telephone services in the aforementioned state, which alone represents the highest GDP of South America. It also owns a majority stake in the Brazilian mobile operator Vivo, having agreed on 28 July 2010 to buy Portugal Telecom's stake in the firm for €7.5 billion, after increasing its original offer by €1.8 billion over three months of incident-rich negotiations.[21] The Telefónica group has been in the country since 1996 when it acquired CRT, a fixed-line and mobile operator in the southern part of the country. The landline division is currently part of Brasil Telecom. In July 1998 acquired Telesp, the telephony operator of the Telebrás system in the state of São Paulo, forming Telefônica Brasil.[22]

In 2009, after four big "blackouts" on Telefónica's broadband "Speedy", ANATEL ordered Telefónica to stop sales of its broadband service until improvements were made on the infrastructure to provide better-quality service.[23] After the release of sales of broadband internet in August 2009, ANATEL expects the company's service investments to keep on par with the sales. On 24 July 2010 Telefónica announced that the number of Speedy subscribers had exceeded three million people.

Telefónica owns Telefónica Chile, formerly CTC (Compañía de Telecomunicaciones de Chile, formerly known as Compañía de Teléfonos de Chile) which is the biggest fixed-line operator and internet service provider in the country. The Telefónica Group has been in the country since 1989. The mobile business is run by Telefónica Móviles through a local subsidiary. On 25 October 2009, Telefónica Chile changed its name to Movistar, including cellphone, landline, satellite TV, and internet.[24]

On 18 April 2006, Telefónica's president Cesar Alierta signed an agreement with the Colombian government to buy 50% and one share of the state-owned communications company, Colombia Telecomunicaciones (TELECOM).[25] With this sale, Telefónica became the largest Colombian land-line operator, and also gained an important presence in the local, long-distance and broadband market. The mobile business is run by Telefónica Móviles through the brand movistar. It is unknown what will happen with their previous established subsidiary Telefónica Empresas, being most probable a merger with TELECOM. The company is now known as Telefónica - Telecom.

Telefónica signed a contract for 15 years (extendable for 10 additional years) on 12 May 2011 with the government of Costa Rica. It started operations in 2011 under its Movistar branding.

In 2000, Telefónica acquired a 26.5% stake in Tricom when it purchased part of the shares Motorola had obtained in 1993.[26]

After acquiring 100% of OTECEL S.A. (Bellsouth), Telefónica Móviles Ecuador started its operations on 14 October 2004 as Movistar. It offers mobile solutions for the Ecuadorian market and is one of only three mobile operators in Ecuador. Telefónica in Ecuador has started offering 3G service from the second half of 2009.

After acquiring 100% of Paysandú S.A., Telefónica Guatemala Centro América started its operations in 1998 as Telefónica Movistar and just Telefónica for landlines. In 2004, acquired 100% of BellSouth Guatemala, relaunching mobile operations as movistar in 2005, with mobile services based on CDMA technology, in 2004 as Telefónica Movistar launch national service with GSM/GPRS technology, and CDMA 1x EV-DO for data. It offers mobile solutions for the Guatemalan market and is one of only three mobile operators in Guatemala, international operator as Millicom (TIGO) and América Móvil (Claro). Telefónica Móviles Guatemala (renamed in 2005) offers services on UMTS/HSPA since June 2009, and it was the last operator to launch commercial services on this technology, with coverage in all major cities.

Telefónica started its operations in Panama in 2004 as Telefónica acquired 100% of Bellsouth Panama. Since then it has operated using the name Movistar for mobile services. It migrated from CDMA technology used by Bellsouth to GSM 850. It also offers 3G using UMTS 850 and UMTS 1900. In 2015 it launched LTE with coverage expanding in Panama City, Arraijan, Chorrera up to Buenaventura Beach.

The Telefónica Group has been in the country since 1994 and owns the largest fixed-line operator in the country. The local subsidiary offers local, long-distance, and broadband services nationwide. The mobile business is run by Telefónica Móviles through a local subsidiary. The mobile telephone business goes by the name Movistar and competes with major provider Claro. Their main offices are located in Santa Beatriz on Av. Arequipa 1155.

Since January 2011, Telefónica has operated in the market under the Movistar brand.

Telefónica in Puerto Rico has presence through Telefónica Empresas, Telefónica Larga Distancia - TLD, Telefónica International Wholesale Services - TIWS (formerly Emergia) and Atento. Telefónica Moviles, through its Movistar brand, had presence in Puerto Rico until mid-2007 that they sold the Puerto Rico network to a private equity group who renamed it Open Mobile.

In late 2004 Telefónica took over the operations of Telcel Bellsouth in Venezuela, the first and largest mobile operator in the South American country at the time. After re-branding as Movistar, its CDMA2000 EvDO was progressively replaced by a GSM UMTS 3G network. Telefónica is currently rolling out 4G LTE in the country.

Based in Miami, Florida, Telefónica USA, Inc. provides services to U.S.-based multinational companies that have operations in Latin America and Europe. Telefónica USA also operates the KeyCenter™, a data center in Miami built to withstand category 5 hurricanes,[27] from where the company supports Business Continuity and IT services for Enterprise customers in South Florida.

In 2009, China Unicom agreed to a $1Bn cross-holding with Telefónica.[28] In January 2011, the two partners agreed to a further $500 million tie-up in each other. Following completion in late 2011, Telefónica will hold a 9.7% stake in China Unicom, and China Unicom will own 1.4% of the Spanish firm.[29]

In 2018, China Unicom and Telefónica establish a new partnership to combine their services and networks in the internet of things, so as to enable their clients to deploy IoT products and services in China, Europe and Latin America with a single global IoT SIM card.[30]

In 2005, Telefónica bought Český Telecom (Czech Telecom), the former state-owned Czech phone operator which still dominates the Czech fixed-line market. As part of this deal Telefónica also gained its 100% subsidiary Eurotel, one of three mobile phone operators in the Czech Republic. Starting 1 July 2006, both companies were merged into one legal entity and renamed Telefónica O2 Czech Republic. In 2011, the company was renamed Telefónica Czech Republic and in 2013, it was announced that Telefónica would sell its stake in the company to PPF. Under the terms of the sale, the company was allowed to continue to trade under the O2 brand for a maximum of four years.[31] In August 2017, the brand license agreement was extended to 2022, with a 5-year extension to 2027 available.[32]

During 2006, Telefónica won the tender to become the third mobile phone operator in Slovakia, under the O2 brand. It began providing services on 2 February 2007 under the name Telefónica O2 Slovakia, s.r.o. It initially launched providing only a prepaid service but in mid-2007 began to sell contract phones. The company was sold along with Telefónica Czech Republic to PPF.[31]

O2 in Ireland was purchased by Telefónica as part of its acquisition of O2 plc in the UK in 2005. Telefónica Ireland has become the second largest mobile phone operator in Ireland, operating a GSM/EDGE and high-speed HSPA+ wireless broadband network to residential and business customers through its "O2" brand. Telefónica Ireland also provide fixed broadband to business customers.

It was announced on 24 June 2013 that Telefónica had agreed to sell its O2 Ireland mobile business for at least €780 million ($1 billion) in cash to Hutchison Whampoa's subsidiary 3.[33] O2 was merged into Hutchison Whampoa's subsidiary Three Ireland in March 2015.

Telefónica currently owns 46% of Telco, the holding company that controls 22% of Telecom Italia, Italy's former government–owned telephone company. In late 2003, Telefónica announced its intention to acquire the entirety of Telco by January 2014, potentially becoming Telecom Italia's largest shareholder. The plan, was however challenged by the Brazilian competition authority since Telefónica and Telecom Italia, with Vivo and TIM respectively, are the two largest telephone companies competing in Brazil. Subsequently, Telefónica confirmed in September 2014 that it intended to sell its shares in Telecom Italia following the purchase of Global Village Telecom (GVT) in Brazil from Vivendi.[34] Telefónica sold its shares in the business to Vivendi as part of the sale of GVT in June 2015.[35]

In February 2019, Millicom announced the purchase of the Panamanian, Costa Rican and Nicaraguan operations of Telefónica for US$1650 Million, with plans to phase out the Movistar brand from those markets within a year after purchase. The transaction was completed in August the same year.[36] Telefónica had purchased the Panamanian, Ecuadorian and Guatemalan operations of BellSouth in 2004 for US$1665 Million, followed by a rebranding in 2005. The purchase should help Telefónica focus on its largest markets, alleviating its debt.[37][38][39][40]

In football, Teléfonica is an official sponsor for several national teams like Spain (Movistar+) in Europe and Brazil (vivo), Mexico, Colombia, Peru or Venezuela in America.

O2 are the main sponsors of the England national rugby team.

From 2011, they are to sponsor the Spanish UCI ProTour cycling team known as Movistar Team.

Teléfonica, through Movistar, was the title sponsor of Yamaha Motor Racing from 2014 to 2018, a motorcycle racing team in MotoGP, and was also the title sponsor of Suzuki's factory team from 2000 to 2002 Sito Pons' Honda team from 1997 to 1999 and Fausto Gresini's Honda team from 2003 to 2005.

Within Formula One, Telefónica was a major sponsor of the Renault F1 Team until Fernando Alonso's departure to McLaren in 2007, and were title sponsors of the Spanish Grand Prix from 2006 to 2010. Through its acquisition of O₂, Telefónica also indirectly sponsored the BMW Sauber F1 Team. F1 Racing estimates these sponsorships amount to $18 million, $15 million and $23 million respectively.

They also sponsored the Ford Focus WRC during seasons 2000-2002 when Spanish rally driver Carlos Sainz drove for the team. The sponsorship said Telefónica Movistar on it and the stickers were on the front bumper, the rear 3-quarters and the rear spoiler. As Sainz moved to Citroën team, Telefónica followed and sponsored Citroën rally team in 2003.

Movistar- and Telefónica-sponsored teams contested the round-the-world Volvo Ocean Race in the 2005-06, 2008-09 and 2011-12 events.

Telefónica sponsors, through its Movistar brand, the Movistar Riders eSports team.[41]

Telefónica has received several fines due to convictions over unfair competition, abuse of its position as dominant provider, and antitrust violations through the Commission of Telecommunications, European Commission, and Spanish tribunals. These fines include:

• 900,000 euro fine, Spanish tribunals[42]
• 18 million euro fine, Spanish Telecommunication Market commission, 57 million in 2004 for unfair competition[43]
• 151.9 million euro by European Commission for abusing its dominant position[44][45]

As of 2008, Telefónica had in court two more fines, with a value of 793 million euros.[46]

On 5 July 2007, the European Commission ordered Telefónica to pay a record antitrust fine of almost €152 million for activities in the Spanish broadband market which, according to European Union competition commissioner Neelie Kroes, "harmed Spanish consumers, Spanish businesses and the Spanish economy as a whole, and by extension Europe's economy".

Several consumer groups in Spain have reported unnecessary delays in cancelling Telefónica's ADSL service. These consumer groups also claim that services continue to be billed after being cancelled and that service cancellation requests are ignored.[47] This has led Spanish people to organize themselves in consumer groups such as the "Asociación de Internautas" and user communities like "Bandaancha" in order to defend themselves from Telefónica's abuses, and to give support and help to each other in their various complaints about Telefónica's unfair practices.

The practices are claimed to include the complex process involved in cancelling lines.[48] These line cancellation procedures are justified by Telefónica as a way of "defending customers against hoaxes". Furthermore, in areas where ADSL lines are scarce, there are also reports of customers who claim to have had their service cancelled or inexplicably transferred to another customer although they have paid their bills.[49] This practice is considered by some to be used by Telefónica in certain areas of Spain where there are few broadband connections.