Virgin Media O2, joint venture Telefónica and Liberty in the United Kingdom has renewed its alliance with giant Tesco in the mobile phone business in the British market. The 10-year agreement was signed two decades ago and had broad strategic implications for the telecommunications company.
With more than 5.5 million customers, Tesco Mobile has become…
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Virgin Media O2, joint venture Telefónica and Liberty in the United Kingdom has renewed its alliance with giant Tesco in the mobile phone business in the British market. The 10-year agreement was signed two decades ago and had broad strategic implications for the telecommunications company.
With more than 5.5 million customers, Tesco Mobile has become one of Virgin Media O2’s growing businesses in recent years.
In the last financial year, the virtual mobile operator (OMV), whose capital is divided 50% between both partners, increased its revenue by 9.4%, exceeding £969 million (approx. €1.136 million).
Tesco Mobile, which uses Virgin Media’s O2 mobile infrastructure to serve customers and Tesco’s commercial network, reported profits of £6.18m, up 64%. Operating profit increased by 67% to 11.54 million.
The Telefonica subsidiary said the extension joint venture confirms its position as an alternative network among major mobile operators. According to Virgin Media O2, the agreement ensures Tesco Mobile customers will continue to benefit from 4G coverage of 99% of the UK population and over 50% of 5G coverage.
In this sense, Virgin Media O2 is competing with Vodafone, EE (a subsidiary of BT) and Hutchison Three to attract virtual mobile operators to its network in the UK market. “With demand for mobile data greater than ever, we continue to invest heavily in our network to provide our customers and the customers of other providers using our infrastructure with an even better experience of fast, reliable mobile services,” said Lutz Schüler. CEO of Virgin Media O2.
Publication
The renewal of its historic alliance with Tesco comes at a key time for Virgin Media O2. In their shareholders’ agreement, Telefónica and Liberty Global established the possibility of the company going public on June 1, 2024, which would be the third year since the merger was closed and operations commenced. Thus, both partners will have the right to initiate the company’s IPO. joint venture
.The UK is one of Telefonica’s four strategic markets, along with Spain, Germany and Brazil. In the first nine months of 2023, UK operations contributed 13% of the Spanish group’s revenue and 14% of gross profit before depreciation and amortization (oibda).
Telefónica has expanded the board of directors of its subsidiary Tech with two new members. In this case, the new directors are two heads of the technology division itself: Mario Silva, director of technology strategy, and Javier Llamas, head of technology HR.
Tech has José Cerdan, the company’s CEO, as president, Pablo Eguiron, its chief financial officer, and Luis Prendes, who until now has been the company’s legal officer and director of transformation, as consultants. Prendes was appointed in mid-December as the new CEO of the Telefónica Foundation. Company sources indicate that these are changes to the normal course of business.
In 2022, Telefonica created a technical advisory board chaired by Cerdan to help accelerate the company’s organic and inorganic growth and contribute to leadership of its digital transformation value proposition.
It included Cerdan himself, Angel Vila, the group’s CEO, as well as Telefonica directors Veronica Pascual, Claudia Sender and Juan Ignacio Sirac (who left the board in December); directors Chema Alonso, Maria García-Legas, Maria Jesús Almazor and Gonzalo Martín-Villa, as well as experts Alejandro Romero, founder and CEO of Alto Analytic, and Isabel Fernández, PhD in Computer Science and Artificial Intelligence.
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