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Telefonica Deutschland and O2 to Combine Their Activities and Infrastructures

Do you know about O2?? yeah,,,the biggest provider of mobile services. Broadband service provider Telefonica Deutschland and O2 Germany, both owned by Telefonica of Spain, recently announced plans to unite their business-to-business operations, while also putting together the operation of their mobile communications and landline infrastructures to form a common body that would be called Telefonica O2 Germany, which would be able to provide convergent offers, while also registering further growth in the future.

The newly formed business division will combine the sales and marketing of the business customer offers aimed at small, medium-sized and multinational companies, in addition to the landline wholesale business, which is currently seen as the second important branch of activity after the O2 consumer business. In addition to merging businesses, it seems that the two companies also plan on consolidating their network areas, both mobile communications and landlines.
‘Thanks to the merger of Telefonica Deutschland and O2, we have a strong landline and mobile communications organisation that is able to act and react flexibly to market changes. At the same time, we are securing opportunities for further growth in a convergent world,’ commented Jaime Smith Basterra, CEO at Telefonica O2 Germany.

CEO of Telefonica Deutschland, Johannes Pruchnow, who will become managing director of the new business division, said: ‘The most important basis is our state-of-the-art IP-based landline and wireless infrastructure. Thanks to the new constellation, we will be able to advance with the merger of these two infrastructures even more quickly than before.’ Andrea Folgueiras, CTO at Telefonica O2 Germany, will manage the landline operations in addition to her existing responsibilities. The new partnership is expected to offer the possibility to merge the two areas faster than before. Basically, Folgueiras says that new synergies will be created through the restructuring process.
“Offers combining landline and mobile communications are becoming increasingly important, for business customers in particular. The new business division enables us to further expand our portfolio consisting of mobile, Internet access and VPNs. Our successful wholesale business we will continue independently as part of the business to business unit,” says Johannes Pruchnow, CEO at Telefónica Deutschland.

It is understood that the company is following a strategy pursued by competitors such as Deutsche Telekom (DT) and Vodafone which have set up business customer units to bundle the full range of telecoms services. It seems that O2 Germany was the country’s fourth largest wireless network operator by subscribers at the end of 2008, with a customer base of 14.18 million, representing 13.24% market share. Meanwhile, Telefonica Deutschland was the fifth largest broadband service provider by customers in Germany at the same date, with a total of 1.34 million subscribers, corresponding to a market share of 6%.