Live from the Telefonica Leadership Conference
March 29, 2012 Leave a comment
- The annual Telefonica Leadership Conference in Miami showcases technology innovation and market trends, while also updating customers, partners, and analysts on the company’s key areas of focus.
- Telefonica continues to adjust to economic realities, looking for the right blend of organizational structure and services to ensure a leading role in global markets, at a time when Spain and much of Europe is struggling.
Telefonica finished 2011 with a 3.5% increase in revenues, principally due to its 13.5% year-over-year growth in Latin America, which compensated for the sharp 7.6% revenue slide in its incumbent market in Spain. While the operator acknowledges the difficulties behind it (and ahead of it), it also continues to demonstrate its role in creating the future. The annual Telefonica Leadership Conference in Miami (held this year from March 26-28) highlighted its view of how, as a global telecoms leader, it is helping to shape the world. Highlights included:
- Telefonica executives see the operator as having the scope, scale and experience to help business customers grow in tough times, and its focus on emerging economies such as Latin America and China is helping to “bridge the world and shape the future.”
- The operator celebrates the huge growth in mobility, which has already fundamentally changed the way we do business and which it predicts will result in 10 devices per person (and 50 billion M2M sensors) by 2020.
- Executives also acknowledged the power of the consumer, which is not only reshaping IT, but also reshaping network usage; for example, 80% of smartphone/tablet traffic is going over fixed networks such as WiFi rather than cellular networks. Consumers also influence product adoption through social networks.
- Telefonica is often seen as a regional player, but the company has a direct presence in 25 countries serving 300 million customers. Along with its alliances and partnerships, it effectively covers 1 billion customers in 47 countries. Including its commercial roaming agreements, Telefonica can do business in 150 countries.
- Telefonica has reorganized into two global business units: Telefonica Digital, focusing on services key to the future (cloud, financial services, M2M, e-health, unified communications, security, video/digital home, and advertising), and Global Resources, which houses the Telefonica Multinational Solutions and International Wholesale services groups.
- The operator is also adopting consolidation, rationalization, and streamlining measures that could save EUR 1 billion annually, such as rationalizing handsets globally, consolidating NOCs and IT operations, selling off non-strategic infrastructure, and sharing mobile facilities.
- All in all, Telefonica acknowledges that the current world economy is challenging, but the company is confident that its MNC strategy, global reach, digital services focus, and investments in emerging markets will continue to reap benefits for the operator and for its customers.
Telefonica’s key areas of market focus continue to go up in terms of subscriber numbers. The company increased its numbers of mobile (pre- and postpaid) voice and fixed broadband customers in 2011, even if the latter’s growth worldwide was a somewhat tepid 5% year-over-year. Mobile broadband has 10%-30% customer penetration across Telefonica’s markets, and (excluding SMS) mobile data revenues are growing briskly, in the 25%-50% range year-over-year. In addition, its investments in global M2M are starting to pay off: The company’s OnStar deal (a large contract for in-vehicle emergency and information communications services in GM vehicles outside of North America and China) demonstrates the sort of contracts the company can win, and aims to win in the future.