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Telefonica Signs Contract With Dell - Analyst Blog

Posted: 5/10/2013 3:20:00 PM
Referenced Stocks: DELL;FTE;TEF;VOD

Spanish telecom operator, Telefonica S.A. ( TEF ) has struck a deal with Dell Inc. ( DELL ) to offer mobile connectivity solutions for its Windows 7 and Windows 8-based devices throughout Europe by means of Dell NetReady solution.

Dell is already using Telefónica's mobile service. Therefore by connecting to Dell NetReady technology, the customers can easily connect their devices to the Telefónica's pay-as-you-go Internet plan.

The new bundled service, will serve corporate users better as they can easily access the network whether in office or away by just a click of a button. The plan is also made flexible starting from 30 minutes up to 1 a month with two different rate plans.

Telefonica is facing intense competition from the likes of France Telecom 's ( FTE ) Orange mobile brand and Vodafone Group Plc. ( VOD ). In order to safeguard its position in the European region the company is continuously upgrading its 3G mobile broadband networks -- High Speed Packet Access Plus (HSPA+) and Dual Cell HSPA. The company is further working to deploy LTE services in urban areas and also taking initiatives to adopt new technologies like Voice over LTE (VoLTE) to drive its top line.

The company has undertaken several efforts to enhance efficiency across European markets such as removal of handset subsidies in Spain, gradual reduction of subsidies in the U.K., network sharing agreement in the U.K. and Mexico and redundancy program in Spain. Such initiatives would lead to further savings and boost profit in the coming years.

Telefonica S.A. currently has a Zacks Rank #3 (Hold).

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