Eurobites: Content Costs Drag on Telefónica's Q1

Also in today's EMEA regional roundup: Altice's first quarter is a game of two halves; Openreach consults with CSPs on broadband future; GÉANT network draws on Dimension Data; Telia concern over Kazakhistan's snooping strategy.

  • First-quarter earnings at Telefónica failed to live up to analysts' expectations, Bloomberg reports, with rising content costs in its domestic market and faltering businesses in Mexico and Peru all taking their toll on the numbers. Organic operating income rose 4.8% to €4.02 billion (US$4.36 billion), but this was still less than the €4.06 billion ($4.41 billion) that analysts had hoped for. Revenues rose 5%, to €13.1 billion ($14.22 billion). For more detail on the results, see Telefónica's statement.

  • Altice 's first quarter was, to introduce some fractions anarchy, a game of two halves, as the Financial Times reports (subscription required). In the US, core operating profit grew 9.5% year-on-year, to €2.24 billion ($2.43 billion). In its French homeland, however, Altice's SFR unit saw operating profit slump 5.1%, to €820 million ($890 million), as it lost 351,000 mobile customers and 213,000 broadband customers during the first quarter.

  • BT Group plc (NYSE: BT; London: BTA)'s Openreach unit is to consult with its communications service provider customers on how best to improve broadband connectivity across the UK. The consultation will be a two-pronged affair -- one part looking at how to build the investment case for a large-scale "full fiber" network and the other focusing on bringing faster broadband speeds to current sluggardly spots through the use of what Openreach is calling Long Reach VDSL. Openreach is also touting a new, "confidential" approach to engaging with its CSP customers, which it says forms part of its preparation for greater functional separation from BT. Today BT also announced it was cutting around 4% of its workforce to help it save around £300 million ($387 million) over the next two years. (See BT Agrees to Openreach Split.)

  • GÉANT , the European research and education network, is to offer Dimension Data 's cloud services through 18 of its National Research and Education Network (NREN) partners, putting them potentially within reach of thousands of universities, schools and research institutions across the region.

  • Legislation that aims to ease restrictions on data transfers between EU countries could be initiated this fall, according to a report on EurActiv. Andrus Ansip, the EU's technology policy chief, announced the decision to propose the legislation as part of a review of the European Commission's "digital single market" initiative.

  • Telia Company has voiced its concerns over new surveillance regulation being introduced in Kazakhstan, which it believes could have "potentially serious impacts on the freedom of expression" of its customers there. The Kazakh government intends to employ SORM, a system which originated in Russia and, says Telia, offers the authorities "real-time access" to its network.

    — Paul Rainford, Assistant Editor, Europe, Light Reading

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