Telefonica is an UnTelco Example to Follow

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By Dimitris Mavrakis | 3Q 2018 | IN-5180


Telefonica Spends Big on R&D, but Where Does it Go?


Telefonica is one of the largest mobile service providers in the world and was recently benchmarked in terms of innovation in our Telco Innovation Benchmark, along with other top-20 operators. We assessed these mobile service providers in terms of 3GPP involvement, patents, R&D spend, and open source contributions. Telefonica stood out: although it was not in the top-10 list for nearly all of these metrics, it was the top performer in terms of R&D spend. We interpreted this exceptional behavior as Telefonica investing heavily in its internal transformation, which rarely translates to external activities including patents and 3GPP contributions. However, we were not entirely certain this was the case.

Telefonica held its analyst conference this week and confirmed our assumptions: its CEO claimed that the operator now spends 10-15% of its revenue in R&D, which is several times higher than the industry average of 1-6%. The CEO also claimed that this internal digitization and transformation is now paying dividends, and more than 50% …

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