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Sunday, 25 October 2009

Patricia Covarrubia

Telefonica Chile to operate under the trade mark Movistar

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From today onwards the Chilean company, which is the main telecommunication company in the country, will start working under the trade mark Movistar (see press release in Spanish here). However, note that Telefonica SA owns Telefonica Chile Ltd and, as some of you may know, Telefonica SA is a Spanish company which is one of the largest land lines and mobile telecommunications operators companies in the world.

Telefonica SA operates the Movistar trade mark through Latin America which provides only mobile phone services. In Europe for example, the company works under the trade mark O2. That said, Telefonica SA owns several line operators in the Americas and in Europe and has received quite a few fines under unfair competition laws due to its dominant position (see the European Commission fine here).

Chile will be the first country in which the Spanish company will unite all telecommunications under the same trade mark, namely Movistar. Will the company’s bubble burst? I believe that with this action, there is a great possibility that governments would like to investigate this deal.

Patricia Covarrubia

Patricia Covarrubia