The Departure by José María Álvarez-Pallete de Telefónica It marks the end of an era that symbolizes the decline of the sector in Europe. Its mandate ends with a 57% drop in the stock market value of the company since 2016, when it agreed to the position.
Of course the problem goes far beyond Telefónica.
Why is it important. The European Telecommunications sector has lost 41% of its stock market capitalization between 2015 and 2023, falling to 270,000 million euros. In contrast, American telecos are worth more than 650,000 million.
The root of the problem. Europe has 34 mobile network operators and 351 virtual operators for 450 million inhabitants. The United States, with 335 million inhabitants, only has three main and 70 virtual operators. China, for 1.4 billion inhabitants, has four operators and 16 virtual.
Proportionally to its populations …
- Europe has eight times more main operators than the US and 27 times more than China.
- In virtual operators the difference is even greater: almost four times more than the US and 78 times more than China.
Between the lines. European regulation has prioritized low prices and high competition, creating a fragmented and unable sector to compete globally. Meanwhile, the US and China have opted for giants with financial muscle.
This dynamic has had consequences: it is expected that the sector only grows 1.7% in 2025. In Spain, 71,000 jobs have been destroyed since 1998, according to appointment Five days. And while the 5G coverage in Europe is 81%, in the US and in China it exceeds 95%, according to The independent.
Turning point. He Draghi report Ask to facilitate mergers and end market fragmentation. The new European Competition Commissioner, Teresa Ribera, He said that the rules “will evolve” to allow larger scale.
It is a burning nail to which you have to grab. Without a regulatory change that allows consolidation (and perhaps requires greater contribution to large technological ones whose business goes through the use of these networks, A historical demand Of the great telecos), the European Telecos sector will continue to lag in the global race.
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