Telefónica puts off fibre investment
Iñaki Ferreras

In 2007, Spain’s incumbent telco Telefónica promised investment of €1,000 million up to 2010 in a fibre optic network. But the company’s present economic reality has changed and the investment horizon will be extended until 2012.

The new infrastructure of the telco will allow the users to access internet speeds of 100Mbps and also to watch HDTV, but all this will cost too much for the company to implement it in the short term.

The telco already has 350,000 homes or companies passed by this network, meaning users can access it if they want to, provided Telefónica offers it to them. But the number of clients is low: so far, just 10,000 homes and 15,000 businesses are connected.

While economic circumstances are not allowing the company to speed up its plans in this area, there are also not yet the services that make it necessary that a home has a 100Mbps internet connection. So Telefónica is concentrating on the development of products according to the demand from users, such as high definition.

In the interim, the telco is promoting the VDSL2 technology which allows higher speeds than ADSL, and also more quality, new services and upload capacity similar to the download capacity. So Telefónica’s current goal is to have an intermediate solution requiring a much lower cost than fibre with the goal of getting more ‘advanced’ users.

But one thing is certain: the company’s plans to improve the network to extend these services are not so aggressive since by 2012, 71% of the networks direct to the home will have a 10Mbps access but only 23% of them will reach to 25 Mbps.