Thursday, February 23, 2012

Telefónica Sees Growth in Latin America and Mobile Broadband

in line with its prior financial guidance, Telefónica reported 2011 consolidated revenues of over 62,800 million euros, up 3.5% for the year. Growth was driven by the increase in wireless data revenues (+19% in organic terms) and growth in Latin America (+13.5%), a region which already represents 47% of the Group's total consolidated revenues. Telefónica increased its customer base by +7% year-on-year, reaching 306.6 million accesses as at 31 December 2011.

César Alierta, Chairman of Telefónica, stated "On the one hand, we have increased our customer base to exceed the 306 million mark, while the Company’s strategy to strengthen its competitive position is already paying off, showing a significant increase in the commercial activity in the second half of the year, and a remarkable growth in mobile broadband. In 2011, Telefónica has led the increase of penetration of mobile broadband services in its markets, with more than 38 million customers at the end of the year, 61% above 2010 figure. As a result, mobile data revenue also grew significantly to almost 20% in organic terms, and now represents 31% of mobile service revenues."

Some highlights:

Telefónica’s mobile accesses stood at 238.7 million in 2011, with a year-on-year increase of 8% in organic terms, following an acceleration in the growth rate during the second half of the year. It is worth highlighting net additions registered during the fourth quarter, reaching a record in the year (7.8 million accesses, excluding the disconnection of 1 million inactive prepaid accesses in Brazil in December), with a year-on-year increase of 45%.

Mobile broadband accesses -accesses with a data rate attached and therefore active users of the service- exceeded 38 million at the end of 2011 (+61% year-on-year). This figure represents a penetration rate of 16% over Telefónica's total mobile access base. Telefónica Europe reached a penetration rate of 31%, followed by Telefónica España (29%).

Retail fixed broadband accesses reached a total of 18.0 million (+5% year-on-year).

The number of Pay TV accesses stood at 3.3 million in 2011 (+19% year-on-year), with a pickup in the growth rate, basically due to the successful commercial repositioning in Latin America, where net additions in 2011 tripled those of 2010, the inclusion of TVA's Brazilian customers as of June and the good commercial performance in Spain during the second half of the year.

Fixed telephony accesses reached 40.1 million, down 3% year-on-year. This decline remained stable throughout 2011.

CapEx in 2011 reached 10,224 million euros, with a 3.3% year-on-year increase in organic terms. In reported terms, CapEx declined 5.7% year-on-year. It is important to mention that the 2011 CapEx figure includes the cost of the spectrum in Spain, Brazil and Costa Rica, amounting to 1,296 million euros.

Cisco to Acquire Lightwire for Optical Interconnect

Cisco will acquire Lightwire, a developer of optical interconnect technology, for $271 million in cash and incentives.

Lightwire, a start-up based in Allentown, Penn., specializes in CMOS photonics. Its optical interconnects promise to integrate multiple high speed active and passive optical functions onto a small silicon chip. Lightwire’s OASIS (Opto-electronic Application Specific Integrated Subsystem) platform is expected to offer lower power dissipation and smaller form-factor modules. On its website, the company says it is developing a range of high speed optical transceivers, but has not publicly announced any products to date.

"The acquisition of Lightwire will support our data center and service provider customers as they manage the continuing deluge of network traffic alongside tight capital and operating budgets," said Surya Panditi, senior vice president, Cisco Service Provider Networking Group. "With the combined know-how from Cisco in silicon design and Lightwire in CMOS photonics, we will transform Cisco's optical connectivity business to an integrated technology platform that supports our customers' burgeoning need for cost-effective high-speed networks."

Lightwire employees will be integrated into Cisco's Transceiver Modules Group Business Unit and Supply Chain Operations Group.
  • Lightwire is headed by Ameesh Divatia, who was Senior Vice President and General Manager of Intelligent Network Products at Emulex Corporation from May 2006 to September of 2008. Earlier in his career, he was the founder of Pipelinks, which was acquired by Cisco in December 2008.