Telefónica Launches O2 in Spain

Telefónica has introduced its O2 brand in Spain. Targeting the budget market, O2 will feature mobile-only and convergent (fiber plus mobile) offerings. The mobile plan comes with 20 GB of data plus unlimited national calls and SMS for €20.00 (US $23.58) a month, while the convergent offer includes the same mobile service plus symmetric fiber broadband with speed up to 100 Mbps and a landline with unlimited national calls for €45.00 (US $53.06) a month. Customers may also add up to three additional mobile lines with 10 GB of data, unlimited calls and SMS for €15.00 (US $17.69) each.
 
O2 will be activated in “beta mode” in the coming days, ahead of a mass market launch that Telefónica said would take place “after the summer.” Telefónica stated that O2 will be a “premium” service, while its youth-oriented Tuenti brand will be maintained as a low-cost alternative.
 
Telefónica said that because of Spanish regulations from 2016 having to do with competition in the fiber market, these prices will only be applicable in the 66 municipalities that the regulator, CNMC, deemed competitive. In other municipalities, the O2 convergent offer will cost €58.00 (US $68.39) a month, but the operator said it will implement a system to compensate customers for the €13.00 (US $15.33) price difference and adjust the price accordingly whenever the city becomes a competitive area.
 
It appears that in introducing the O2 brand in Spain, Telefónica is aiming at a market sector that is budget-conscious but that nonetheless wants converged offers with fixed line service. The fact that the operator intends to keep its MVNO Tuenti intact indicates that it considers the market for O2 to be a distinct one. Tuenti, which originated as a social-media network, is for the youth demographic in particular and offers the lowest prices. By launching another MVNO under the O2 brand—which already has name recognition from its operations in the U.K. and Germany, Telefónica can capture a new market without compromising either its Tuenti brand or its main brand for MNO service, Movistar. Maintaining O2, which is being characterized as a relatively “premium” service, alongside Tuenti and Movistar enables the operator to slice its market more finely.
 
O2, which boasts low prices but offers landline and fiber internet for the home, will likely be quite appealing to those users who want more than just the least expensive mobile-only option—although O2’s mobile-only offer is competitively priced. Telefónica is the leader in fiber development in Spain (thus the strictures placed on it by the regulator with regard to the 66 municipalities), which is itself the number-one country in Europe for fiber-to-the home penetration. Fiber has proved to be a key differentiator among Spanish operators, and Telefónica’s competitors Vodafone and Orange have had to play catch-up.
 
With O2, Telefónica is mounting a direct challenge to the smallest of Spain’s four operators, MasMóvil, which has been growing its market share very rapidly recently. MasMóvil also offers converged services (fiber and mobile) at low cost and with a very simple pricing structure.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance.  

To learn more about Tarifica, please visit www.tarifica.com 

Telefónica Launches Tuenti MVNO in Guatemala

Spain-based multinational operator Telefónica has announced the debut of its prepaid, youth-focused Tuenti MVNO in Guatemala, which it says will feature flexibility and transparency. The available voice-and-data bundles range from 1.5 GB of data and 75 minutes of calls for GTQ 50.00 (US $6.50) to 3 GB and 100 minutes for GTQ 75.00 (US $10.00) and 5 GB and 125 minutes for GTQ 100.00 (US $13.50). The plans also include unlimited access to WhatsApp, unlimited calls to other Tuenti subscribers and 25 minutes of VoIP calls through the Tuenti app.

Guatemala is the fifth Latin American market in which the Tuenti MVNO brand has been launched; first Mexico in 2014, then Argentina, Peru and Ecuador. The Mexican experiment did not go very well, and Telefónica discontinued Tuenti in that country, but that does not appear to be an indicator that this type of service is, generally speaking, a weak competitor. Most likely, the budget MVNO faced too much competition in Mexico, while in the other markets it is able to garner more market share.

As we have written in the past, the youth market is a fast-growing and potentially very lucrative one for mobile operators. Young people, while budget-minded by necessity, are strongly inclined to use large amounts of mobile data, and they are at an age when consumption habits and brand loyalties are being formed. Therefore, generous and low-priced offerings of data on a prepaid, low-commitment basis are the right way to get and keep these valuable customers.

Tuenti’s Guatemala service fits the bill in terms of price as well as data allowances—which, though not princely, they are adequately generous and appropriate for streaming entertainment content. The zero-rating of WhatsApp recognizes the fact that youth tend to rely heavily on OTT messaging.

While Tuenti does not offer specifically youth oriented entertainment content, it does offer calls to other Tuenti users, which is at least a nod to the particularly social nature of its target demographic.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance. 

To learn more about Tarifica, please visit www.tarifica.com 

Tuenti Ecuador Launches Referral Offer

Spain-based international operator Telefónica has announced the launch of a friends’ referral scheme to help boost uptake of its Tuenti Movil MVNO service in Ecuador. Under the offer, any Tuenti prepaid customer can access their account online and send an invitation to friends via email, Facebook or Twitter. The friend who sets up a Tuenti account and as the friend who made the referral each receives US $5.00 in promotional credit. Tuenti Ecuador offers a series of data-focused prepaid plans, ranging from a 7-day bundle with 100 MB of data, 15 minutes of calls and 15 SMS for US $5.00 to a 30-day bundle with 400 MB of data, 60 minutes of calls and 60 SMS for US $15.00.

  

The MVNO market in Ecuador is in its infancy; when Telefónica, which operates under the brand name of Movistar there, launched Tuenti there in June 2015, it was the first MVNO in the country. There are currently no independent MVNOs in Ecuador. So while Tuenti has no direct competitors, it still needs to establish itself in a marketplace that is unused to such offerings. In order to distinguish itself from Movistar’s other offerings, as well as from those of competitor MNOs, Tuenti has emphasized the social media angle with unlimited zero-rated WhatsApp and Facebook usage. This brand identity harmonizes well with a socially driven promotion campaign such as this friends’ referral scheme, which operates via social media, as well as email. We believe that it is particularly persuasive, in that the amounts of credit received for a referral is quite large in the context of Tuenti’s prepaid tariffs, since it is equivalent to a week’s worth of services. In addition, the fact that both the referred friend and the one making the referral get a credit makes the offer even more attractive.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance. To learn more about Tarifica, please visit www.tarifica.com