US mobile tower operator American Tower has acquired up to 2,500 towers from Telefonica’s Mexican subsidiary, Pegaso PCS. The purchase price reaches approximately $500 million USD (excluding taxes).
American Tower expects to complete the acquisition of a substantial majority of the towers during this year’s fourth quarter, subject to regulator y approval and customary closing conditions.
Telefonica has built a technology centre in Mexico. Overall investments in the project amounted to EUR 22.51 million, El Economista reports.
Located in the Ixtlahuaca Technology Park, the facility aims to strengthen Telefonica’s telecommunications infrastructure and prepare for the deployment of new services for consumers. The project was developed in partnership with Nokia Siemens Networks.
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Broadband penetration in Peru is expected to double from 4.7 percent in 2011 to 9.3 percent in 2016, driven by the government’s national broadband plan to bring Internet connectivity via fiber-optic cables to isolated regions, according to a new report from Pyramid Research.
“In 2011, broadband penetration will reach 4.7 percent, still among the lowest in the region just ahead of Ecuador, Paraguay, Bolivia, Guatemala and Nicaragua,” says Pyramid Research Analyst, Juliana Gomez.
Broadband penetration will be driven by the government’s national broadband plan, which aims to bring Internet connectivity via fiber-optic cables to isolated regions such as the Sierra and Selva. As economic development touches cities outside Lima in the Sierra region of the country, competition for new subscribers will expand the reach of fixed networks. Telefonica and Telmex are both offering double- and triple-play bundles, including fixed telephony, broadband Internet and pay-TV services.
“Given the low penetration of Internet services and the government support for developing broadband networks, broadband has great potential to fuel bundles,” she indicates.
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MasterCard and Telefonica have created a joint venture to offer mobile financial services for the 65 million Vivo customers in Brazil.
The partners will develop a mobile wallet service, enabling consumers to make payments via their mobile phones as well as transfer funds, pay bills and make online purchases. The service allows operations between banked and unbanked consumers and fosters the acceptance of mobile payments at locations that traditionally have only accepted cash transactions, such as taxis and delivery services, as well as direct sales such as door-to-door transactions.
The new company will operate independently with each shareholder holding 50 percent of the equity. The joint venture will be presented to competent authorities for approval.
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Brazilian operator Telefonica/Vivo has launched the Telefonica TV Digital HD pay-TV service in the State of Sao Paulo. The operator is providing four different types of packages: Fit HD, Flex HD, Premium HD and Full HD, with prices ranging from BRL 109.90 to BRL 199.90.
In addition to the 75 pay-TV channels in Standard Definition (SD), these packages now bring between 11 and 17 pay-TV channels in HD. Some of the HD channels include Globosat HD, Multishow HD, HBO HD, the Telecine HD channels, TNT HD, Fox/Nat Geo HD and Discovery HD Theater. The new packages also provide access to up to 15 free-to-air channels in HD, according to regional availability.
Telefonica is considering selling assets that “underperform” to reduce debt and regain investors trust after sales in Spain slumped and growth in Brazil slowed, Bloomberg reports, citing Telefonica CFO Angel Vila.
The CFO ruled out selling Telefonica’s operations in Germany, Mexico and the Czech Republic, or its 9.7 percent stake in China Unicom. Telefonica is assessing its businesses to find non-core or underperforming assets that can be divested, Vila said at an industry conference in Barcelona. Telefonica recently reiterated its full-year financial and dividend forecasts, including sales growth of 1-4 percent over three years from an adjusted base of EUR 63.1 billion in 2010.
The company aims to lower its debt to between 2 and 2.5 times OIBDA. According to Vila, Telefonica would reconsider its dividend policy only if its debt rating, cut to BBB+ by Standard & Poor’s in August, leaves the triple B category. “We would not move beyond this BBB class territory unless there were unimaginable pressures that would put us beyond that. If that was going to be the case we would have to react,” Vila added.
Telefonica has announced its financial results, and reported that its net income for the three months to the end of September plunged to a loss of EUR429 million (US$582 million), compared to a profit of EUR 5 billion (US$6.9 billion) a year ago.
The company’s first quarterly loss in nine years was put down in part to EUR 2.6 billion worth of costs associated with its Spanish redundancy programme to cut 6,500 staff over three years as the company copes with the economic downturn in its home market.
Third quarter revenues rose by 3.7 percent to reach EUR 15.8 billion (US$21.4 billion).
Commenting on the previous nine months performance, Telefónica Chairman, César Alierta, has stated that consolidated figures at 30 September 2011 reflect the “Company’s focus on setting the groundwork for future revenue growth”, highlighting the results of the strategy to expand mobile broadband services. “30% of our mobile service revenues now come from data services”. He also reiterated the sound results achieved in Brazil, the stabilisation of trends in Spain, and the Group’s capacity to generate high levels of operating cash flow despite the increase in commercial activity and higher investment.”
The total customer base across the group reached 299.7 million at the end of September 2011. By region, Telefónica Latinoamérica and Telefónica Europe, were the major contributors to Telefónica’s customer base growth.
Debt at the end of September was EUR 55.4 billion.
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