Telefónicawatch
This release
: #134
April 2019: 72pp
Releases/year: 10+
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EXECUTIVE BRIEF

GROUP

Acquisitions and disposals: EC launches probe into E-Plus merger [p.6]

  • What, no merger?

People [p.11]

  • Table: People movement highlights

GLOBAL RESOURCES

5G: Telefónica wins EUR10m funding for 5G pilot in Galicia [p.13]

  • Telefónica focus still on services beyond connectivity
  • Deploying fibre now looks like the easy part

García on small steps, and big leaps, for virtualisation [p.17]

  • End-to-end end game with iFusión
  • Telefónica orchestrating industry harmony
  • Small vendor opportunities

Network Innovation: Blanco on industrialised fibre as networks become more complex [p.14]

  • A fibre machine
  • UNICA optimising its potential, with opportunities for all

Partners: Lopez on the edge as Telefónica aims to tame complexity [p.23]

  • Networks to adapt to customer needs, not vice-versa
  • Complexity comes hand in hand with granularity
  • No 'killer' use case for edge
  • Open APIs make multi-local global

Facebook and Telefónica link for wholesale open access [p.26]

  • Magma in the core

Partners: Telefónica extends crowdsourced data deal with Tutela [p.28]

  • The only way is ethics

Telefónica Empresas: Telefónica Empresas cosies up to IBM [p.30]

More industrial solutions with Geprom [p.33]

  • Industrial and private LTE key elements of Telefónica enterprise drive

Telxius: Telxius pools capacity with Telia Carrier [p.35]

DIGITAL SERVICES

Big Data: JD.com: second Chinese partner to join Smart Steps JV [p.38]

Security: ElevenPaths goes to Brazil [p.41]

  • Panda picks up more security work with Telefónica

Video: Telefónica to create original TV content in LatAm [p.44]

LATIN AMERICA

Brazil: Vivo partners McAfee on mobile security app [p.46]

Kite takes off in Brazil [p.47]

  • IoT players bubble up in Brazil

MediaKind to integrate Netflix into Vivo's IPTV platform [p.48]

Chile: McAfee secures Telefónica fibre [p.52]

EUROPE

Germany: O2 Germany starts LTE tests in 700MHz band [p.57]

Pressure mounts over white spots in Germany [p.59]

  • Previous collaborative efforts set to miss targets

Spain: Movistar Money reaches wider audience [p.61]

UK: O2 UK extends Netcracker BSS/OSS deal [p.63]

CEO roles highlighted in Phones 4u collusion claims [p.65]

FURTHER READING

INDEX

Symbols

21st Century Fox

Sky plc 66

A

ADVA Optical Networking 20

AI 11, 21, 24, 25, 30, 31, 68

Alibaba 39

Allianz SE 70

Allot 46

Alphabet

 - Google 25, 32

 - Android 32, 50, 53

Altán Redes 55

Amazon 25, 42

Amdocs 50, 69

América Móvil 51, 55, 69

Ankr 22

Apple 47

 - iOS 50, 53

Arsenal FC 11

ASTI 34

AT&T 54, 55, 69

B

Baidu 39

BBVA 48, 62, 69, 70

Bezeq

 - Pelephone 39

BNetzA 58

C

CaixaBank 61

Cellnex 9, 67

Cellwize 21

CIENA 20

Cisco Systems, Inc 34

CNMC 62

Coriant 20

D

Deutsche Telekom 25, 34

Drillisch 7, 60

E

Entel 53

E.ON 11

Ericsson 13, 15, 20, 22, 34, 47, 48, 49, 66, 69

European Space Agency 15

European Telecommunications Standards Institute (ETSI) 22

European Union 6, 13, 58, 64

 - European Commission 6, 67

European Regional Development Fund 13

F

Facebook 26, 27, 36, 68

 - Telecom Infra Project 20, 26, 27

Federal Network Agency 58

Ficosa 34

G

Geprom Connecting Industries 33, 68

GSM Association (GSMA) 19

 - Mobile World Congress 17, 23, 27, 34, 40, 68

GTD 53

H

HBO 50

Huawei 13, 20, 47

I

IBM 30, 31, 68

IFT (Mexico) 54, 55, 69

Infinera 20

Inmobiliaria e Inversiones el Coigue

 - GTD 53

J

JD.com 38, 39

L

Liberty Global

 - Virgin Media 11

M

MásMóvil 13

Mavenir 22

McAfee 46, 52, 69

MediaKind 48, 49, 69

Microsoft 23, 25, 36

 - Mediaroom 48, 49, 69

MVNOs 8, 66

N

NEC 63, 64

 - Netcracker 63, 64, 70

Netflix 44, 48, 49, 53, 54, 69

Netsia 34

NII Holdings, Inc 51, 69

Nokia 13, 20, 21

NTT 20

O

O2 Arena 64

Ofcom (UK) 66, 70

Open Networking Foundation 18, 23

O-RAN Alliance 27, 68

Orange 13

P

Panda Security 43, 68

PeerStream 42, 68

Phones4u 65, 70

P.I. Works 19, 21

PricewaterhouseCoopers 65

Q

Quortus 34

R

Raízen 47

Regions

 - APAC

  --  China 38, 39

  --  Hong Kong 39

 - EMEA

  --  Denmark 58

  --  Europe 6, 11, 13, 14, 15, 22, 34, 35, 36, 49, 51, 56, 58, 64, 67, 68, 70

  --  France 9, 11

  --  Germany 6, 7, 8, 11, 20, 44, 57, 58, 59, 60, 64, 70

  --  Ireland 70

  --  Israel 39

  --  Italy 9

  --  Netherlands 9, 14

  --  Poland 58

  --  Slovenia 11

  --  Spain 9, 10, 13, 14, 15, 36, 41, 43, 44, 46, 48, 49, 61, 62, 68, 70

  --  Switzerland 9

  --  UK 9, 11, 39, 43, 59, 63, 64, 65, 66, 70

  -  Latin America 15, 26, 27, 34, 35, 42, 44, 45, 46, 48, 49, 50, 51, 53, 54, 68, 69

  --  Argentina 15, 48, 49, 50, 69

  --  Brazil 11, 15, 20, 22, 36, 39, 41, 42, 46, 47, 48, 49, 50, 51, 52, 64, 68, 69

  --  Chile 15, 22, 34, 49, 52, 53, 69

  --  Colombia 15, 34, 44, 48, 49, 53, 69

  --  El Salvador 51

  --  Guatemala 51

  --  Mexico 28, 48, 51, 54, 55, 69

  --  Peru 11, 26, 27, 34, 44, 48, 55, 68, 69

  --  Uruguay 40

 - North America

  --  Canada 29

  --  USA 35, 36

Rivetz 42, 68

Royal KPN 8

RTVE 62, 70

S

Samsung 31, 32, 50, 68, 69

 - Galaxy 50, 69

Sapient 33

Standard and PoorSs 10, 67

Subtel (Chile) 53, 69

T

TalkTalk plc 9

Technologies

 - 2G 54, 58, 69

 - 2.5G 55

 - 3G 54, 58

 - 4G

  --  LTE 6, 7, 8, 27, 33, 34, 47, 57, 58, 59, 69, 70

 - 5G 7, 9, 13, 15, 16, 17, 21, 27, 33, 34, 55, 57, 58, 60, 62, 64, 68, 70

 - Advanced Wireless Services (AWS) 55

 - AI 11, 21, 24, 25, 30, 31, 68

 - Blockchain 40, 68

 - BSS/OSS 63, 64, 70

 - Cloud computing 22

 - DVB-T 57

 - eSIM 50, 69

 - Ethernet 33

 - FTTH 14, 16, 44, 68

 - ICT 64

 - IMS 21

 - Internet of Things 11, 33, 39, 47, 62

 - IP 21, 22

 - IPTV 48, 49

 - LPWA 33

 - M2M 11, 47

 - NB-IoT 47, 69

 - NGN 16

 - OpenRAN 21

 - R&D 42

 - SIM 42

 - SDN 18, 64, 68

 - TV 44, 48, 49, 50, 69

 - WLAN

 - Wi-Fi 16, 27, 33, 52

Telecom Italia

 - TIM Brasil 47, 51

Telefónica Group 6, 10, 14, 17, 21, 22, 23, 26, 27, 28, 32, 35, 38, 39, 40, 42, 43, 44, 48, 49, 50, 51, 62, 65

 - Associates and investments

  --  China Unicom 38, 39

 - Digital 38

 - Digital services

  --  AURA 29, 31, 62

  --  ElevenPaths 41, 42, 43, 46, 68

  --  Innovación Alpha 42, 68

  --  LUCA 11, 39

  --  M2M 11, 47

  --  OTT 48, 49, 50, 53, 54, 69

  --  Smart Steps 38, 39

  --  Telefónica Digital España 38

  --  Wayra 42, 64

 - Europe

  --  E-Plus 6, 7, 8, 58, 67

  --  Germany 6, 7, 57, 58, 59, 60, 70

  --  giffgaff 66

  --  O2 6, 7, 9, 11, 54, 57, 58, 59, 60, 62, 63, 64, 65, 66, 70

  --  Spain 13, 31, 32, 46, 48, 61, 62, 70

  --  Telefónica Consumer Finance 61

  --  Telefónica Deutschland 6, 7, 8, 11, 22, 46, 57, 58, 59, 64, 70

  --  UK 9, 11, 43, 54, 63, 64, 65, 66, 70

 - Executives

  --  Alierta, César 65

  --  Almazor, María Jesús 31

  --  Alonso, Chema 40

  --  Blanco, Enrique 14, 17, 44

  --  Caro Bernat, Juan Manuel 29

  --  Elizondo, Antonio 19

  --  Fernández-Palacios, Juan Pedro 19

  --  Figueroa, Paula 44

  --  García, Juan Carlos 17

  --  Haas, Markus 58, 70

  --  Lopez, Patrick 23

  --  Martín-Villa, Gonzalo 40

  --  Meggs, Gavin 11

  --  Navarette, Carolina 53

  --  Padilla Fuentes, Andrés 34

  --  Salgado, Alex 41

 - Ex-executives

  --  Dunne, Ronan 65

 - Global Resources

  --  5TONIC 15, 64, 68

  --  BRUSA 36

  --  CTIL 9

  --  MAREA 35, 36

  --  Telefónica Business Solutions 11, 64

  --  Telefónica Empresas 11, 30, 31, 32, 33, 68

  --  Telefónica Global Technology 19

  --  Telxius 35, 36, 68

  --  UNICA 17, 18, 19, 21, 22, 34, 68

 - Latin America 64, 69

  --  Argentina 50

  --  Brazil 11, 41, 42, 46, 47, 48, 49, 50, 51, 68, 69

  --  Chile 52, 53, 69

  --  Colombia 53, 69

  --  Mexico 54, 55

  --  Peru 55

  --  Vivo 11, 41, 42, 46, 47, 48, 50, 51, 68, 69

 - Movistar+ 68

 - Products and services

  --  Movistar+ 68

  --  Movistar Play 49, 50, 53, 54, 69

  --  pay-TV 44, 48, 49, 62

 - Telefónica Emisiones 67

Telenor 17

TeliaSonera 35, 36, 68

Tencent Holdings 39

Tesco 66

 - Tesco Mobile 66

Thomson 67

Tutela Technologies 28

Twitter 62

U

United Internet

 - 1&1 7, 60

UTEK 15, 68

V

Virgin Group 11

Vodafone Group 7, 9, 11, 13, 25, 57, 59, 62, 65, 68, 70

 - Germany 7, 57, 59

 - Spain 13, 62

 - UK 9, 11, 65

Volkswagen Group

 - SEAT 34

VTR 53

W

Wibson 29, 40, 68

Z

ZTE 20

  • Telefónica Group trumpeted the replicability of its Spanish fibre-to-the-premises (FTTP) rollout, as it claimed European leadership.
  • CTIO Blanco stressed that Telefónica’s focus remains on services within the home, with fibre principally a means to an end.
  • Investment currently still capex-focused, but virtualised services to lead transition to more operational spending.
  • Beyond the heavy-lifting, Blanco’s team of strategists and architects is coming to the forefront as network development enters a new phase.

Enrique Blanco, Global Chief Technology and Innovation Officer (CTIO) at Telefónica Group, discussed Telefónica’s achievements and expectations in relation to fibre services at the FTTH Council’s FTTH Conference held in the Netherlands in March 2019.

While talking-up the rapid deployment progress that industrialisation of the fibre rollout has enabled, Blanco indicated that mere connectivity is not the raison d’etre of the Telefónica drive, saying that the strategy is underpinned by a desire to take end-to-end control of fibre-based connectivity, and cement the Group’s place as a provider of the services the technology enables.

  • As Global CTIO, Blanco oversees 18,000 staff who work in operations and engineering.

A fibre machine

Blanco reiterated the strength of Telefónica’s fibre operation, highlighting its success in rapidly deploying full fibre in Spain, and similar progress being made in Latin America.

“If you put all the numbers together, we are number one in [FTTP] in Europe in terms of homes passed and connected, and we are number one in Latin America for FTTX/cable premises passed: This year in Brazil, we will be connecting — not homes passed, but connecting — more than 1.4 million customers with [FTTP]. Today, 2019, every month we are connecting more than 100,000, so 1.5 million this year, premises in Brazil. This is happening in Argentina, in Colombia, in Chile, and the rest of our operations. ” – Blanco.

The CTIO stressed that Telefónica has been able to industrialise the fibre deployment process based on its experience in Spain, and is taking that expertise to Latin America, with the operator becoming “a big machine” for rolling out fibre.

“We are controlling end-to-end. The customer premises equipment [CPE], the services we are offering, the vendors, the quality, the process, the model of how we control the contractors… Everything is an industrialised model that we are following, and, because of this, we are getting all the knowledge.

We [operators] are pure knowledge companies, we try to [create] the greatest knowledge in all our operations and you can see what this means: it means we can reduce the cost of homes passed and connected, the number of complaints. We can reduce the cost of operations because we are building a single machine that is fully devoted to reducing [capital expenditure] and [operating expenditure] and driving growth by quality of experience. ” – Blanco.

Blanco said that Telefónica data suggested that an FTTP-connected household in Spain is on average carrying almost 180GB of downstream traffic per month.

Telefónica focus still on services beyond connectivity

While Telefónica is an industrialised machine for fibre rollout, once customers are connected, Blanco noted that the priorities for the telco and the customer change, and Telefónica focuses on the delivery of capabilities and services rather than pure connection speed.

As part of this, the CPE that accompanies a Telefónica subscription is considered of paramount importance. Through the home equipment, and the technology that Telefónica is developing through its cognitive intelligence platform, the operator is “building an open ecosystem of extra services that our customers can control”, according to Blanco. Among these services, video is central, accounting for approaching two-thirds of the demands placed on capacity.

“We are not selling [customers] FTTP. We are selling them Wi-Fi, we sell them, experience and services. If we were only connecting with FTTP, we are opening their homes to other competitors, and this is what we need to avoid. Because [of this] Telefónica is taking a different approach to FTTP. It is not a pure fibre connection. ” – Blanco.

With Telefónica providing both fixed-line and mobile services in many of its markets, Blanco appeared to suggest that it made little difference to the operator whether the endpoint is using fibre-to-the-premises or 5G, as long as there is a fibre core that can deliver the needed capacity. The development of Wi-Fi 6 standards (with the potential of 10Gbps connectivity) is expected to lead to even greater demands on core infrastructure.

“If you put together 5G and Wi-Fi 6 at 10Gbps, we will offer additional capabilities to our customers next year in the CPE. ” – Blanco.

Deploying fibre now looks like the easy part

While Telefónica is mindful of the change in customer behaviour that next-generation networks are bringing, the operator is also focusing attention on addressing the complexity that is accompanying the development of virtualised and effectively cloud-based networks.

Blanco noted that, in the mid-term, this would entail continued significant capital expenditure, but suggested that investment would evolve towards operating expenditure as networks become more software-based.

“If you look at 2020 and what’s going to happen with our budget, we will still be a not insignificant part of the capex, but, in the next three or four years, we will [see] a radical evolution of the [network] topology by definition of the services. ” – Blanco.

In the context of the FTTH Conference, Blanco did not expound on the intricacies of creating platforms that support virtualised networks, but the topic is at the forefront of the Technology and Innovation team he leads, as evidenced by further conference appearances and discussions from other senior executives (see separate report).

Image: FTTH Council Europe

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