Last week the Mobile World Congress was held and we have talked more about the news and trends than about the underlying movements in the sector, which greatly affect the competitiveness of our country. Let's remember where we come from to better understand where we are going: in 1989, the Franco-German research group Groupe Special Mobile, GSM, defined the protocols that make it possible for mobile phone companies to be compatible with each other. The launch of the GSM system required investments and redoing infrastructure, but it compensated because it opened new businesses such as roaming. The first roaming agreement between two operators, one Finnish and one English, was signed in 1992 and little by little the rest were added. In 1995, the operators that used the GSM standard met in an association, the GSMA, which organizes the Mobile World Congress. The standard has been evolving and each new version has been named with a number: 3G, 4G, 5G, and although each one has offered more and better features, what has always really been sought is to increase the income of operators.
For example, in Spain, citizens' true access to the Internet arrived at the turn of the century and until well into the 2000s, the majority did not begin to have email at home. This is when 3G is deployed with a clear proposal: the phone is also used to receive and answer emails. Blackberries arrive, but they also begin to charge us for data packages and make a lot of money. The states saw that all this would be a big deal and decided that only three or four companies would have access to the radio spectrum where 3G operates, and which would be decided through an auction. The winners would pay the State hundreds, billions of euros and would compensate it with the business they would do.
The Internet continues to evolve and in 2005 YouTube was founded and video arrived, and in 2009 the iPhone was presented, a clearly multimedia device. In order to support audiovisual formats on mobile phones, 4G is launched and operators once again deploy infrastructure and pay billion-dollar auctions to states for the privilege of having access, but things go wrong and they watch in astonishment the appearance of large streaming platforms like Netflix. or Spotify, which make billions. It is now a classic to hear the presidents of telephone companies complaining bitterly that without their infrastructure the business of Google, Facebook, Amazon or Netflix would not be possible, but that none of these companies pay them for it. With 4G, the operators have caught their fingers: they have invested a lot in infrastructure and in paying licenses to the states, but the business has been done by others. And with 5G things have not gone better.
European policies have further complicated the sector, which has caused exaggerated fragmentation. There are two major mobile phone operators in China, and three in the United States. Large markets managed by very few companies that can amortize investments. On the other hand, in Europe there are eighty major telephone companies and none of them are very large. Telefónica has such a weak value that with only 2,000 million euros, Saudi Arabia can aspire to 10% of the shares and become the main shareholder. And if we zoom in we see that in Spain alone there are more than six hundred telephone operators. It's ridiculous. Small and very small companies that will never achieve a reasonable size to assume the investments that our digital future needs.
Everything will continue to evolve and we will need to catch up. It will be necessary to deploy 6G, 7G or whatever the innovations that will come are called, but the operators will no longer be willing to pay billions to the State and also assume the cost of these infrastructures. The numbers do not add up and the next auction may already be the other way around: the State will have to pay if it wants someone to deploy a network in the territory. Perhaps this is why Spain makes its move and announces its entry into Telefónica's shareholding: the country's competitiveness cannot depend only on the commercial logic of an operator. In Catalonia we discuss the management and expansion of the airport a lot, but we are not discussing who will manage and expand our digital infrastructure. Meanwhile, Cellnex's shareholders are no longer from here and no one has said anything.
