Telefonica is raising its tariffs and scaling back promotions in its key Spanish market in order to counter a drop in consumer spending amid a slowdown in Spain's economy, a Dow Jones report said.
In July, Telefonica began charging fixed line subscribers â‚¬0.50 (US$0.73) per month for caller ID, a company spokesman said. Before the change, the company offered the service free of charge.
Earlier this month, Telefonica said some of its promotions would stop counting toward the â‚¬9 (US$13.2) minimum monthly expenditure the company levies on mobile customers.
Telefonica is also charging â‚¬1 (US$1.46) more per month on some of its high speed internet plans.
The Spanish consumer association Facua filed a complaint to the Spanish government questioning the legality of the caller ID charge, the Dow Jones report said..
A Facua spokesman said the increase already affects 2 million customers, and will affect another 6 million in October. The caller ID charge could boost Telefonica's revenue by â‚¬48 million euros (US$70.4 million) a year.
In spite of stronger growth in Latin American and European markets, in Spain Telefonica is facing nearly stagnant revenue growth. In the second quarter of 2008, Telefonica Spain's revenue rose 0.8% to â‚¬5.2 billion euros (US$7.6 billion), the Dow Jones report further said.