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

  • With a fibre foundation topped with a virtualised network, Telefónica is aiming to create flexible services that adapt to customer needs.
  • Edge computing key to service evolution, but will be driven by incremental benefits, not a single compelling killer application.
  • As Telefónica focuses on becoming a technology-focused company, partnerships will be needed to transform itself into a truly global competitor.

Patrick Lopez, Vice-President of Network Innovation for Telefónica Group, participated in a panel on the potential merits of edge computer technology in network infrastructure at the FutureNet World event in London at the end of March 2019.

Lopez, also a Board Member of the Open Networking Foundation, reinforced and expanded Telefónica’s stance on the mobile edge as set out at Mobile World Congress 2019. There, the company stressed the importance of partnerships to expand its reach and scope, embedding Microsoft Azure in its plans, supporting the operator’s forward-thinking, technology-focused leadership (Telefónicawatch, #133).

Networks to adapt to customer needs, not vice-versa

Lopez started with an observation that current networks require customers to adapt what they do based on the capabilities of communications networks, and said that the goal of Telefónica’s transformation is to create an infrastructure that can adapt to customer needs instead.

He said that Telefónica is considering a range of approaches and technologies to help rethink network architecture and create more elastic systems to achieve this objective.

As demonstrated in other recent Telefónica comments (see separate report), the underlying principle driving the transformation is the disaggregation of the network and the services and applications that run across it.

Complexity comes hand in hand with granularity

Lopez noted that, in the past, introduction of new services meant the introduction of additional hardware and software layers too, resulting in networks that become inflexible, expensive to run, and time-consuming and even more expensive to alter.

Modern approaches make the networks more responsive and granular, and better able to adapt to what customers are doing, but as software and functions become independent of the hardware they run on, the networks also become far more complex to manage. This is where automation and artificial intelligence technologies are expected to take up the load, but for these solutions to be effective operators need a foundation of effective analytics tools that can extract the relevant data from vast networks at speed.

“That’s where basically we use data science to detect first anomalies, then detect patterns, and try to match those anomalies and patterns to issues. And then we try to find use cases in which we can make the network self-configure proactively, whenever possible, to adapt or anticipate the customer demand.

We think that there’s a continuum between public cloud, private cloud, core network, edge, on-premise, on-device and that continuum requires our armoury to function well. ” – Lopez.

No ‘killer’ use case for edge

While Lopez is convinced of the value and need for edge computing and other new technologies, he also acknowledged that there is no single use-case that can justify the investment at this stage, but that collectively the array of potential benefits and applications justify the expenditure.

“[Spending on edge computing is] an infrastructure investment. We haven’t found one single use case that justifies deploying edge computing. There are several dozens of use cases [that] together can justify the edge, but the reality is the edge is [only] going to work for telco if it works for us. AI is the same thing. I don’t think we’re going to find one single use case that will necessitate it absolutely. ” – Lopez.

Lopez emphasised that the first justification for deploying edge computing must be supporting the needs of the operator itself, before additional services are considered.

“[New technologies] must make sense for our own functions, for our own telecom workloads [then] we [will] discover the value. For instance, right now, we have edge compute providing four millisecond (ms) latency between [customer premises equipment] and the first virtual machine. The value of that can be large, we believe, but it’s got to be working for us first.

One of the dumbest examples we can take is very simple. It’s just caching. Counter-intuitively, you think that live content wouldn’t [need caching], but, if you have a recap, a large proportion of people are watching it as a unicast, and there is huge transport cost savings by deploying [at the edge]. And there are a lot of use cases like that. ” – Lopez.

Open APIs make multi-local global

With the development of edge access, the opening up of capabilities to a wider market is expected to be dependent on a more standardised approach that will make it straightforward for developers to work with operators around the world with minimal need for customisation.

“[We must] have sufficient APIs and platforms so that, at the end, the developer can build for the use of that compute capability. Then it will be a marketplace.  We’re working with a number of companies in that space, but we haven’t done a good job opening our networks because, for the longest time, our networks were just for our use. Now that the boundary between cloud and networks is getting blurrier and edge computing becomes an extension of the cloud… Telefónica is big, Vodafone is big, Deutsche Telekom is big – but I don’t think it makes sense to ask developers to code something that is specific to each one of us. ” – Lopez.

Lopez believes that developers will continue to be drawn to more established cloud platforms for creating services as a starting point, but, if a more standardised approach can be adopted, a telco cloud marketplace will emerge.

“We might find a way to ask them to code a version that is specific to telco, but, in all likelihood, they’re going to start developing on Amazon Web Services, or Google Cloud or Microsoft Azure. We have to make sure that [if we have] one developer application in this environment, there a possibility to expand its use and its workload into our telco cloud. There’s a number of initiatives in that space, but it won’t work if it’s not possible to do that. ” – Lopez.

The Telefónica executive made a distinction between the nature of telecoms operators and the world-striding IT giants, noting that, even with a presence in many parts of the world, telcos assets and strengths are best described as “multi-local” rather than global. Lopez indicated that Telefónica’s partnership plans are developing with a view to addressing that difference.

“I think that, if we’re deploying compute capabilities in our networks that we hope to rent or sell and make available to other parties outside of the telecom industry, then we have the responsibility to offer the tools to make that available on a global scale because the cloud companies are global and we [operators] are multi-local.

“The distinction here is that none of us [operators] really has a global business, but, if we want the edge computing to become a global business, if we want to enable AI in that context, [then we must be] willing to offer the platforms to enable that. We’ve come up with some strategy [and] an announcement at MWC for a strategic relationship with Microsoft in that direction, and we will see more in the future. ” – Lopez.

Image: Telefónica

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