Telefónica on track to meet its 2008 targets

MADRID — Telefónica (Madrid:TEF)(NYSE:TEF)’s results for the second half of the year show high growth rates, extending the positive performance seen since early this year.

Pay TV accesses stood at over 2 million at end of the first half of the year, up 57.4% on the prior year, due to net adds of close to 280,000 accesses in the first half (+25% compared to the same period of 2007). The Company currently offers Pay TV services in Spain, the Czech Republic, Peru, Chile, Colombia and Brazil.

Telefónica España

Telefónica’s retail Internet broadband accesses net adds totalled 169,098 in the second quarter and 390,923 in the first half of 2008, resulting in an 18.3% year-on-year increase in accesses to over 5 million at the end of June 2008. The Company remains market leader with an estimated share of over 57%.

In the pay TV business, Telefónica ‘s estimated market share stood at over 13% at the end of June 2008, with 22,513 new customers added in the second quarter (32,307 in the same period in 2007) and 65,471 in the first half of 2008. Pay TV customers totalled 576,558 (+27.9% year-on-year).

The total number of Duo and Trio bundles surpassed 4.2 million units at the end of June 2008. This means that more than 83% of the Company’s retail broadband accesses were part of a double or triple offer bundle at the end of June 2008.

Telefónica Latinoamérica

Telefónica Latinoamérica now has 1.4 million pay TV customers, up from 799,627 in June 2007, with operations in Peru, Chile, Colombia and Brazil.

Brazil – Telesp

In pay TV, Telesp has built a competitive offering on TVA’s assets. A total of 346,894 Telefónica customers in Brazil are enjoying the service, after having recorded a net adds figure of 64,558 accesses in the second quarter of 2008 (+25.5% from the previous quarter) and 115,987 accesses in the first half.

Telefónica Chile

The company had 240,801 pay TV customers at the end of June, up 40.5% year-on-year, and added 20,885 accesses from December 2007.

Telefónica del Perú

Telefónica del Perú’s Pay TV base stood at 653,249 accesses, up 8.9% from June 2007 thanks to the sharp growth in satellite and cable subscribers.

Colombia – Telefónica Telecom

Year-on-year pay TV accesses growth remained strong (almost four times as many customers as in June 2007), with 112,615 accesses at the end of June 2008 after 39,685 new customers were added in the first half.

Telefonica Europe

Telefónica O2 Czech Republic

The total number of TV customers increased by 10,745 in the second quarter and by 24,753 in the first half to reach 97,918.

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