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TELECOMMUNICATIONS

Telefonica: Nine-month profits dip 10 percent

The sale of subsidiaries in Ireland and the Czech Republic sapped Spanish telecommunications giant Telefonica's profits in the first nine months of 2014, the company said on Wednesday.

Telefonica: Nine-month profits dip 10 percent
The iconic Telefonica building in Madrid. Photo: Javier Paredes

The group's net profits fell by 9.4 percent between January and September compared to the same period a year earlier, to €2.85 billion ($3.6 billion), it said in a statement.

The company's preferred measure, operating income before depreciation and amortization, fell 12.6 percent to €12.33 billion. Sales fell by 11 percent to €38 billion.

The sell-off of subsidiaries Telefonica Czech Republic and Telefonica Ireland weighed on profits for the period, the company said. Those businesses disappeared from its accounts in July.

Also, "the year-on-year evolution of exchange rates negatively impacted financial results," it added, citing currency depreciation in Argentina, Venezuela and Brazil.

Telefonica's chairman Cesar Alierta said he saw scope for growth thanks to the recent acquisition of E-Plus in Germany and its move to buy broadband firm GVT in Brazil.

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TECHNOLOGY

There are still 16,000 public telephones in Spain

Spain has a law to provide at least one payphone for every 3,000 inhabitants, even though an average of one call a day is made from them.

There are still 16,000 public telephones in Spain
Photo: pawpopa3336/Depositphotos

New data reveals that Spain currently has over 16,000 public payphone dotted around the length of breadth of Spain even though an average of one call a day is made from them.

Telefonica sources cited by news agency Efe revealed that Spain's biggest telecommunications company currently spends €4.52 million a year maintaining the phone booths.

Despite the fact that they are rarely used, Telefonica is tied to a “universal service obligation” imposed by the government to provide and maintain in working order a public payphone for every 3,000 inhabitants in each town of 1,000 or more and one cabin in all municipalities of less than 1,000 inhabitants.

The company estimates that of the 16,000 currently in use, half are almost never used and 12,000 ceased to be profitable years ago, losing the company some €3 million  a year.

The number of payphones has been vastly reduced since the  introduction of mobile phones. Twenty years ago there were almost four times as many payphones across Spain  –  55,000 payphones available in 1999 – and you could expect to find one on many a street corner.

Spain's communications regulator CNMC has called on the government to drop the universal service obligation for public payphones after a recent survey found that nearly 9 in 10 Spaniards (88 percent) admitted to never having used a public payphone in their life.

When was the last time you used one?

READ ALSO: Could technology be killing off Spain's sociable mealtimes?

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