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Eurobites: South America Drags Down Telefónica's Q2

Also in today's EMEA regional roundup: Sky's good year; KPN's shaky second quarter; ITV pulls shows from Netflix; Man U start streaming.

  • Second-quarter revenues at Telefónica fell 6.3% year-on-year to €12.144 billion ($14.223 billion), though the operator says they actually grew 2% in "organic terms." Earnings (before depreciation and amortization) grew 1.9% to €4.237 billion ($4.962 billion). In terms of revenue, Telefónica's South American units suffered most, with Telefônica Brasil down 16.7% and Telefónica Hispam Sur (covering Chile and Argentina) down 14%. Guidance for the rest of the year remains unchanged.

    Telefónica's UK unit has agreed a "long-term" (but length unspecified) deal with pay-TV player Sky , which will see Telefónica UK continue to provide the MVNO network for Sky Mobile, as well as giving Sky customers access to Telefónica's 5G testbed, once it is launched. Sky Mobile claims to have attracted more than half a million customers since its launch in January 2017.

  • Sky, meanwhile, has had a strong year in terms of full-year results, with a 5% increase in like-for-like revenue to £13.6 billion ($17.9 billion) and earnings up 9% to £2.34 billion ($3.08 billion). Italy was a particularly happy hunting ground for the operator, with earnings there up 29% thanks partly to the launch of a pay-TV service delivered via digital terrestrial television (DTT) after Sky struck a deal with Mediaset to use its transmission capacity. Programming costs across the group rose 4%, including a £153 million ($201 million) hike in fees for the rights to Germany's Bundesliga soccer and increased investment in original drama.

    Independent analyst Paolo Pescatore was impressed: "A stellar set of results. What a great way to end its fiscal year; goes out with a bang in a good way. Sky is a prized asset for both Comcast and Disney [via 21st Century Fox]. Whoever comes out on top will ensure that Sky has the resources to be an even more formidable player in the rapidly changing media landscape." (See Comcast Gives Up on Fox, Focuses on Sky, Eurobites: Comcast Ups Its Bid for Sky and Fox Trumps Comcast With $32.5B Bid for Sky.)

  • Things don't look quite so rosy at Dutch incumbent KPN Telecom NV (NYSE: KPN), where second-quarter revenues were down 1.7% to €1.402 billion ($1.642 billion), though earnings did inch up 1% to €555 million ($650 million). CEO Maximo Ibarra put a positive spin on things, saying in a statement that he was "confident that further digitalization and virtualization of networks and services provide scope for further improvements." He also claimed that the operator's use of data analytics is both improving customer satisfaction and reducing costs.

  • ITV plc (London: ITV), Britain's top commercial broadcaster, is to remove its archive of shows from Netflix as it prepares to launch a rival streaming service with the BBC and Channel 4, the Mirror reports. ITV is said to have been encouraged by the increase in the number of subscribers to its own free catch-up service, the ITV Hub, which it attributes in part to its screening of the soccer World Cup and the goons-in-swimwear reality show, Love Island.

  • English soccer has-beens Manchester United are to launch their MUTV channel on a range of streaming services via Amazon Fire TV, Apple TV, Roku and Xbox in a bid to extend its already mahoosive fan base, Reuters reports.

    — Paul Rainford, Assistant Editor, Europe, Light Reading

  • James_B_Crawshaw 7/26/2018 | 1:26:56 PM
    Re: English soccer has-beens Manchester United Let me know when so I can record it on my Betamax.
    PaulERainford 7/26/2018 | 12:58:59 PM
    Re: English soccer has-beens Manchester United He's being drafted in around Episode 7 to spice things up a bit. I believe he's planning to talk about automation an' that.
    James_B_Crawshaw 7/26/2018 | 12:43:34 PM
    Re: English soccer has-beens Manchester United Is he also a fan of Love Island?
    PaulERainford 7/26/2018 | 12:10:51 PM
    Re: English soccer has-beens Manchester United Call it observational humour, James. It's mainly to rile Le Maistre as he reclines in his holiday hammock, downing another Portuguese custard tart.
    James_B_Crawshaw 7/26/2018 | 11:10:49 AM
    English soccer has-beens Manchester United What is the source for that statement? The Manchester City fanzine? I demand a stewards enquiry!!!
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