Human Being
1. What changes in political and economic environment allowed Telefonica to start expanding globally?
In 1990 when the company privatized the company and deregulated the telecommunication market.By selling off 12 % of its holdings in the company and offering 100 million share on the market. I also found on the internet that the company expanded into the internet arena in 95 by launching InfoVia, even though the comapny did not completely privatize until 97 when they then sold off its remining 20.9% interst in the company. The Telecommunication Market Commission was then created and then used to promote Spain’s Telefonica had the chance to start expanding globally thanked to two significant changes in the economic and political environment: privatization and deregulation. Telefonica was a typical state-owned national telecommunication monopoly when being established and then, the Spanish government privatized it and deregulated the Spanish telecommunications market. It means that Telefonica from a state-owned company became privately controlled. Government also reduced rules to open telecommunications market for more competition. For these reasons, Telefonica had a sharp reduction in the workforce, rapid adoption of new technology and focused on profits and shareholder value and also started expanding globally for growth.
2. Why did Telefonica initially focus on Latin America? Why was it slower to expand in Europe, even though Spain is a member of the European Union?
Telefonica initially focused on Latin America because of the similarity in culture and the development of Latin American market. Much of region of Latin America and Spain had common language and deep similarity in culture and history. Moreover, Latin America were really a potential telecommunications market which were now growing rapidly, increasing the adoption rate and usage not just of traditional fixed-line telecommunications services, but also of mobile phones and internet connection.
In 1990 when the company privatized the company and deregulated the telecommunication market.By selling off 12 % of its holdings in the company and offering 100 million share on the market. I also found on the internet that the company expanded into the internet arena in 95 by launching InfoVia, even though the comapny did not completely privatize until 97 when they then sold off its remining 20.9% interst in the company. The Telecommunication Market Commission was then created and then used to promote Spain’s Telefonica had the chance to start expanding globally thanked to two significant changes in the economic and political environment: privatization and deregulation. Telefonica was a typical state-owned national telecommunication monopoly when being established and then, the Spanish government privatized it and deregulated the Spanish telecommunications market. It means that Telefonica from a state-owned company became privately controlled. Government also reduced rules to open telecommunications market for more competition. For these reasons, Telefonica had a sharp reduction in the workforce, rapid adoption of new technology and focused on profits and shareholder value and also started expanding globally for growth.
2. Why did Telefonica initially focus on Latin America? Why was it slower to expand in Europe, even though Spain is a member of the European Union?
Telefonica initially focused on Latin America because of the similarity in culture and the development of Latin American market. Much of region of Latin America and Spain had common language and deep similarity in culture and history. Moreover, Latin America were really a potential telecommunications market which were now growing rapidly, increasing the adoption rate and usage not just of traditional fixed-line telecommunications services, but also of mobile phones and internet connection.