Telefonica (NYSE:TEF, news, filings), long the little brother of BT, FT, and DT in Europe’s corporate telecommunications market, is looking to move up in the world. The Spanish based carrier announced a big contract today worth €350M over 5 years with Deutsche Post, which amongst other things owns DHL and has 500K employees all over the world. Most of Telefonica’s €2B revenues from the corporate market come from places that speak, well, Spanish. A deal of this size is not minor at all, it’s clearly a shot off the bow of the big boys.
I have to say though, the European corporate telecom market looks crowded. Alongside BT, FT, DT, and Telefonica are such behemoths as Verizon and AT&T, other incumbents like Teliasonera and KPN, and aggressive upstarts like Colt, Interoute, Level 3, and Global Crossing. There aren’t too many weak spots there, and they are all fighting for the same dollars. Doesn’t it seem like consolidation is inevitable?
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