Telefonica Lost 7.7K IPTV Subscribers in 1Q09

Telefonica lost 7,700 IPTV subscribers in Spain in 1Q09 leaving it with a total of 604,800. It did ad 13,300 IPTV subscribers in its O2 operation in the Czech Republic, ending the quarter with 127,800.

Spain seems to be a difficult IPTV market. Telefonica has clearly lost its momentum in its home market.

Telefonica Spain Adds 23K IPTV Subscribers in 4Q08

Telefonica added 22,943 IPTV subscribers in Spain in 4Q08 ending the year with 612,494. The company stated that this gives it 14 percent of the pay TV market in Spain. Telefonica's O2 subsidiary in Czechoslovakia added 6,435 IPTV subscribers in 4Q08, ending the year with 114,496 subscribers.



Things have picked up a bit for Telefonica in 4Q08, which makes it one of the IPTV leaders in Europe.

Telefonica Spain Adds 13K IPTV Subscribers in 3Q08

Telefonica added 13,000 IPTV subscribers in 3Q08, giving it 589,600 IPTV subscribers at the end of the quarter. Its O2 operation in the Czech Republic grew nearly as much, 10,200 IPTV subscribers, leaving it 108,100 subscribers at the end of the quarter.

Telefonica's total pay TV base grew by 130,000 subscribers to more than 2.1 million at the end of the quarter. The company has a significant satellite TV offering in South America, that accounts for nearly all of the increase. Its pay TV offering in Brazil is successful with 436,100 subscribers at the end of the quarter.

Telefonica does plan to introduce HDTV before the end of 2008.

Telefonica's IPTV business in Spain has hit a real flat spopt with a significant decrease in its quarterly adds over the last four quarters. It will have to take a different approach to get sales moving again. HD should help.

I believe that Telefonica is offering an IPTV service in Brazil, but it has not split out the IPTV vs. the satellite numbers.

Telefonica to cut IPTV Prices in Spain

Articles in Variety and Expansión.com said that Telefonica will drop its IPTV pricing to 3 euros per month next Monday. It will offer a triple play bundle at 43.90 euros. Currently a triple play package costs 6.50 euros for the set-top box and 52.90 euros for a triple play package.

Telefonica's recent lackluster IPTV results have indicated that some action was required. 3 euros per month is not the same as bundling IPTV into a basic broadband subscription as is available in France and Sweden, but it is quite close. Telefonica is in a very competitive market. This move will help it and increase its IPTV sales.

Telefonica Adds 22.6K IPTV Subscribers in 2Q08

Telefonica ended 2Q08 with 576,558 IPTV customers, and increase of 22.6 thousand over the quarter. This was an increase of 28 percent year over year.

Telefonica's O2 operation in the Czech Republic ended 2Q08 with 97.9 thousand IPTV subscribers, an increase of 12.7 thousand in the quarter.

Telefonica's IPTV services are growing at a modest rate compared to the other services in Europe. It seems that the company is not putting its priority in this area.

Telefonica at 554K IPTV Subscribers

Telefonica added 42.9 IPTV subscribers in 1Q08 in Spain giving a total of 554.045 thousand Imagenio IPTV subscribers. It estimates that it has more than 13 percent share of the pay TV market in Spain.

Telefonica also added 14 thousand IPTV subscribers in the Czech Republic, giving it a total of 87.2 IPTV subscribes at the end of 1Q08.

Telefonica continues to make steady progress with its IPTV service in Spain an the Czech Republic. It also has large cable networks in South America. It did not report on its nascent IPTV activities in that region.

Telefonica ends 2007 with 511K IPTV Subscrsibers

Telefonica ended 2007 with 511.1 thousand IPTV subscribers. This is an increase of 42 thousand in 4Q07 and 128.1 thousand over the entire year. Growth in 2007 was significantly smaller than 2006 which saw an increase in the number of IPTV subscribers of 172.4 thousand subscriber.

Telefonica's O2 operation in the Czech Republic ended 2007 with 73.2 thousand IPTV subscribers, an increase of 20.2 thousand in 4Q07 and 58.2 over the entire year. O2 saw increasing subscriber growth in its IPTV service quarter by quarter in 2007.

The growth rate of Telefonica's IPTV service slowed in 2007. It looks like the company will have to put more marketing muscle into its IPTV service to get it back on track.

Telefonica Has 500K IPTV Subscribers

It has been reported that Telefonica of Spain's Imagenio IPTV service now has 500 thousand subscribers. The service is now available to 5 million people in 565 cities and towns in Spain with population greater than 10 thousand people. The Imagenio service offers a basic tier with 30 channels, and an extended tier with 60 channels, plus Football and pay-per-view packages.

Imagenio continues to make good progress. I will report more when the company reports its 2007 results next week.

Telefonica adds 18K IPTV Subscribers in 3Q07

Telefonica added 18,142 subscribers in 3Q07 giving it a total of 469,067 at the end of the quarter. It stated that it now has 12 percent of the pay TV market in Spain. The number of subscriber's to Telefonica's IPTV service grew by 165 thousand in the previous 12 months and by 86.1 thousand since the beginning of 2007.


Brasil Telefonica started an IPTV service in September and had 8.5 thousand subscribers by the end of the month.

Telefonica has not maintained the pace of 80 thousand new subscribers that it set in 4Q06 in 2007. Its third quarter was quite far from this mark. While there may be some seasonal factors at work, it does looks like Telefonica needs to step up the marketing for its IPTV service to build its momentum back.

IPTV Regulatory Battle in Argentina

Fixed line incumbent Telefónica de Argentina will continue preparing for an IPTV launch even though it was warned by the Argentine regulator, Comfer, that it does not have the authorisation to do so. The company has stated that it would invest $98 million to launch an IPTV service called Speedy TV by the end of 2007.

Comfer has threatened to confiscate Telefónica ’s licence if it goes ahead and launches Speedy TV without authorisation. The government is drafting a new telecommunications law that will allow operators to offer bundled services of TV, voice and Internet over a single network. It appears that little work will be completed on this new law until the political in October are complete.

Regulatory issues seem to be a problem in Latin America. TelcoTV providers in Brazil are limited to only video on demand services. The market their should be strong, but it will pay not to get overly enthusiastic about this market. It will take a while for all of these issues to be resolved.

Telefonica's O2 at 40,000 IPTV Subscribers

Telefonica's O2 TV, an IPTV service in the Czech Republic by Telefonica O2 Czech Republic, has passed 40,000 subscribers. The acceptance of this service was helped by a new triple play service as well as the country's from analog to digital TV transmissions. The service is seen as an attractive way to make this switch. O2 TV offers 38 television channels and 17 radio stations in digital quality as well as a video on demand offering that includes movies and TV programs.

This is a very good result for a small country. It appears that the service is on its way to becoming quite successful.

Telefonica Adds 32K IPTV Subscribers

Telefonica added about 36 thousand subscribers in 2Q07, giving it a total of 450,925. This is quite consistent with 1Q07, when it also added 26 thousand subscribers. The company will be enhancing its service in September in order to give its IPTV service a boost. It expects to reach 1 million IPTV subscribers in 2008.

Telefonica has slowed down a bit and has fallen well behind France Telecom. Its coming service upgrade should increase the rate at which it is adding subscribers.

Telefonica Chile Introduces IPTV

The Chilean unit of Spains Telefónica has launched IPTV services in Santiago, its first in Latin America. Telefónica Chile has invested US $20 millionn into network upgrades and equipment purchases to facilitate the IPTV rollout.

The service is limited to the wealthier neighborhoods in the northeastern corner of Santiago.
The neighborhoods chosen for the rollout are the only areas where the network has sufficient bandwidth to handle 6Mbt channels needed to deliver the service. There are plans to expand the service to other parts of the city in 2008.

By the end of 2007, Telefónica expects to have some 3,000-5,000 IPTV subscribers. However, in the near term the service is only a complement to Telefónica's existing digital TV and satellite services.

The IPTV service offers video on demand, with some 240 hours of content available. Every month around 20% of that content will be updated.

At the end of May its competitor, VTR had a 71% share of the pay TV market, down from 77% at end-2006, according to Telefónica. The incumbent has had digital and satellite TV services for one year and at the end of May had a 14% market share with 156,547 clients, a 66% increase compared to the end of 2006.

This is a small beginning in IPTV for Telefónica in Chile. Don't expect dramatic growth. The broadband network there is not ready to support IPTV on a broad basis. This is also Telefónica's third pay TV service and will have to compete for resources within the company.

France Telecom buys Ya.com in Spain

France Telecom has bought the competitive broadband carrier Ya.com from Deutsche Telekom. This adds 400 thousand broadband subscribers to Orange Spain giving it a total a total of 1.1 million subscribers. This makes it number two in Spain after Telefonica with 4 million broadband subscribers. Ya.com does offer IPTV services based on Microsoft software.

This is the second foreign competitive carrier that Deutsche Telekom has sold in the last couple of months. It also sold its Club Internet subsidiary to Neuf Cegetel.

I expect that Orange will move Ya.com subscribers off of the Microsoft software.

Telfonica Targets 1M IPTV Subscribers

Telefonica's Imagenio IPTV service is preparing a new assault on the pay-TV market from September 2007, with new programming and more channels available. The company plans to offer up to 200 TV channels by the end of the year and hopes to reach one million subscribers in 2008.

Telefonica has made a good start and seems to have the service in hand. This is a good time for it to get more aggressive.

Telefonica Adds 36K IPTV Subscribers

Telefonica ended 1Q07 with 418,618 IPTV subscribers in Spain, an increase of 35,591 subscribers during the quarter. It added 168 thousand subscribers in the previous 12 months. Telefonica stated that it had a 44 percent share of the net pay TV adds in Spain during the quarter.

Telefonica's O2 operation ended 1Q07 with 26 thousand IPTV subscribers in the Czech republic. This service started in the third quarter of 2006. O2 added 10 thousand subscribers in the first quarter.

Telefonica is continuing to make good progress. It has fallen behind the France Telecom's pace, but it should end 2007 with 550 thousand to 600 thousand subscribers.

Telefonica buys into Telecom Italia

A consortium led by Telefonica is poised to spend 5.15B euros for a 23.6 percent stake in Telecom Italia. The consortium will buy Olimpia, the holding company that owns 15 percent of Telecom Italia. The members of the consortium already own 5.6 percent of Telecom Italia.

This is a bit outside of what I usually include in the blog, but I wanted to mention that this could affect Microsoft's prospects. Telecom Italia is using Alcatel-Lucent's OMP IPTV middleware but is still evaluating Microsoft's IPTV Edition middleware in its labs.

Alcatel-Lucent also the MiView TV IPTV middleware which was originally developed by Telefonica. I expect that Telefonica will encourage Telecom Italia to adopt this middleware software.

Telefonica's Imagenio Ends 2006 With A Bang

Telefonica of Spain's Imagenio had a strong finish in the fourth quarter of 2006. It grew from 206.6 thousand subscribers at the end of 2005 to 383.0 thousand subscribers at the end of 2006. Its quarterly growth figures slowed in the middle of the year, but came back at the end of the year. Even so, it added fewer subscribers than the fourth quarter of 2005:

• Q1 2005 22.1 thousand subscribers added 22.1 thousand total subscribers
• Q2 2005 35.4 thousand subscribers added 57.5 thousand total subscribers
• Q3 2005 34.6 thousand subscribers added 92.1 thousand total subscribers
• Q4 2005 114.5 thousand subscribers added 206.6 thousand total subscribers
• Q1 2006 43.7 thousand subscribers added 250.3 thousand total subscribers
• Q2 2006 17.2 thousand subscribers added 267.5 thousand total subscribers
• Q3 2006 36.9 thousand subscribers added 304.4 thousand total subscribers
• Q4 2006 78.6 thousand subscribers added 383.0 thousand total subscribers

Telefonica pointed out that it now has 10 percent of the pay TV subscribers in Span and that 40 percent of its 2006 growth came in the fourth quarter.

Telefonica has made a strong commitment to Pay TV. In addition to its Imagenio IPTV service in Spain, it is currently working on bringing IPTV to its Latin American subsidiaries. It also operates cable and satellite TV systems in Latin America. Its total pay TV subscriber base grew to 1.064 million subscribers at the end of 2006 from 683.2 thousand at the end of 2005.

You can find Telefonica's fourth quarter presentation at http://www.telefonica.es/investors/.

Telefonica has an aggressive IPTV program. It is the number three IPTV provider in Europe after Free and France Telecom. We expect that the growth of its IPTV subscribers will continue strong in 2007. We also expect to see it introduce IPTV services in Latin America in 2007, starting in Brazil.