UK and other European markets to be prioritised
Telefónica has unveiled a new strategy focused on restructuring its division and prioritising certain markets.
In a presentation on November 28, chairman and CEO Jose María Alvarez-Pallete outlined five key proposals to help long-term growth, and increase agility and efficiency.
These are to prioritise the key markets of Spain, Brazil, the UK and Germany; spin-off the Latin American operations into an autonomous unit with a dedicated team, subject to a business review; launch the Telefónica Tech division, which will focus on growing cybersecurity, IoT and Big Data, and cloud services for Telefónica’s B2B customers; create Telefónica Infra, an infrastructure strand that will house its majority stake in tower subsidiary Telxius.
In a letter, Alvarez-Pallete explained his reasoning for the restructure: ” On one hand, the explosion of connectivity and Artificial Intelligence and the new needs of our customers – the central axis of our strategy – require innovative, intelligent
and sustainable technology solutions that generate a positive impact on the environment and help manage the
digital transition. Cloud, IoT, Big Data or cybersecurity are terms we hear most often. They represent a huge
opportunity for our customers, and for us as well. And we are ready to take advantage of it.
“On the other hand, geopolitical, macroeconomic and regulatory uncertainties and high competition in the sector require an increasingly demanding allocation of capital. If in the past the low penetration of voice and data services assured future growth, the current maturity of the markets and the appearance of new competitors subject to different rules demand a highly focused and alternative strategic approach in order to continue growing. We must recognise that the model that has allowed us to get this far successfully is close to being exhausted. And once again, we want to be pioneers, seeking new formulas for growth, offering the best service to our customers and managing resources as efficiently as possible.”