Telefonica seeks immediate efficiencies

Telefonica Spain wasted no time in seeking operational improvements, revealing an extension to its contract with billing software firm Redknee just a day after parent Telefonica Group seeks the business is being merged into its broader European division.
 
The Spanish operator is extending its use of Redknee’s price and optimization software to include detailed profit analysis and forecast information for residential and corporate customers. The business is seeking to improve its efficiency amid falling earnings and a bleak economic outlook for Spain.
 
Redknee chief Lucas Skoczkowski says the deal will allow Telefonica to maximize its profits by “driving new revenue streams and delivering a differentiated, valuable service.”
 
Telefonica Group on Monday announced its Spanish outfit will become part of its European business, in what analysts regard as its most critical reorganization since the buyout of O2.
 
While the firm couched the move as geographical streamlining, it is also seeking to address lower earnings in its domestic business. First half operating income at the Spanish business fell 15.5% year-on-year to €2.8 billion, and revenue declined 6.1% to €8.7 billion.
 
It is also notable that the firm’s Latin American head José María Álvarez-Pallete, will run the combined European operation. His division’s operating income grew 10.6% to €2.8 billion in the first half, as revenue hit €14.1 billion.

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