Good morning and welcome to Telefonica conference call to discuss January, December 2019 results and Pablo Liron, Head of Investor Relations. Before proceeding, let me mention that financial information contained in this document related to the fourth quarter 2019 has been prepared under International Financial Reporting standards as allotted by the European Union. From the 1st January 2019, we implemented IFRS Six in organic terms, the effects of the accounting change to IFRS 16 have are excluded in 2019. This financial information is analytics. This conference call webcast, including the Q And A session, may contain forward looking statements and information relating to the telephone Rega Group.
These statements may include financial, but operating forecast and estimates based on assumptions or statements regarding plans objectives and expectations that make reference to different matters. All forward looking statements involve risks and uncertainties and contingents many of which are beyond the company's control. We encourage you to review our publicly available disclosure documents filled with relevant securities market regulator. If you don't have a copy of the relevant press release and the likes, please contact Telefonica Investor Relations team in Madrid or London Now, let me turn the call over to our Chairman and Chief Executive Officer, Mr. Jose Maria Alvarezajet.
Thank you, Pablo. Good morning and welcome to Telefonica's 4th quarter and full year conference call results. Today, with me are Angel Vila, Chief Operating Officer and Laura Abasolo, Chief Financial Officer. He will take us later through the main operating and financial highlights. During the Q And A session, you will have the opportunity to ask any questions you may have.
2019 has been a crucial year. I would like to start highlighting the action plan we announced last November, the new Telefonica. We are designing ambitious, responsible and sustainable company, full of opportunities within a changing world that requires foresight. But as we also said back in November, we leveraged in a very strong starting position, which we felt is even stronger once we look back at 2019 performance. All our core markets are performing well.
Spain has posted 10 straight quarters of revenue growth and OIBDA returned to growth and we believe it is probably the most sustainable business model in the sector in Europe. Brazilian macro momentum is gaining speed, which helps the competitive environment to turn more rational. And our market share is higher than in the last few years. The UK continues to stand out versus its peers growing for 14 straight quarters, whilst Germany operational performance and trading momentum gain speed. We are increasingly more efficient and benefits from legacy shutdowns and turning more and more evident.
Digitalization savings exceeded 2019 target by 23% to more than EUR 420,000,000. This comes along with an improved capital structure held by disposals and other decisions that helped improve return on capital employed. Such as tower disposals or turning to lighter asset model in Mexico and more should follow. Over the next few slides, I would go through the Neo Telefonica, and Laura and Angel will later review in detail 2019 performance. But wanted to start my presentation today highlighting Telefonica's current strength as these are the foundations for what will come next.
The new action plan will serve to accelerate the company transformation and is centered around 3 axis. 1st, prioritize the markets where we can be relevant and grow following a long term sustainable model second, promote growth opportunities at the same time that we leverage the value of our infrastructure third, increase agility and improve efficiency. This new plan consists of 5 strategic decisions, while maintaining our focus on long term impact, value creation and optimizing capital allocation, as you can see on slide 3. 1st, prioritize Spain, Brazil, the UK and Germany as key markets where we can provide differential value to the operational spin off of Istanbul while evaluating our portfolio to maximize its value via growth, consolidation, and potential corporate operations. 3rd, the launch of Telefonica Tech to boost growth in areas with higher potential, bringing the most advanced value proposition into the B2B segment focusing on cybersecurity, IoT and big data and cloud.
4th, creation of Telefonica infra to optimize the value of existing assets by crystallizing and selective monetization and develop alternative models of infrastructure deployment to for growth opportunities 5th, evolving the operating model to increase agility, speed at execution and maximize synergies between all Telefonica's unit. On Slide number 4, we highlight of our sustainable model based on 3 pillars. 1st, growth. 2nd, efficiency and third, trust, summary, responsible and sustainable growth. Slide 5 showed that sustainable long term business strategy brings along brings long term shareholder value.
For that purpose, we follow 3 long term value generation requirements: 1st growth, inclusive and sustainable. Based in our Ultra broadband and digital services, key enablers for the digital transition and climate change. 2nd trust, with all our stakeholders, customers, suppliers, shareholders, the society as a whole, respecting human values, 40 magazine recognizes for the 2nd consecutive year as Europe's most admired take home and the foremost admired worldwide. 3rd, efficiency, we have been recognized as one of the 8 telcos all over the world to be a list in the CDP benchmark. And we have been pioneers initiating green bonds with the 1st green bond of the telco industry in 2019 and the 1st hybrid green bond in 2020.
Across our footprint, we represent 0.5 percent of GDP. We generate more than 1,100,000 direct Endari Jobs and have a fiscal contribution to the public budget of EUR 8,700,000,000. This is why we are at the top of the list of the main ESG benchmarks such as system analytics, where we are 1st among our peers, MSCI with a rating and we are part of the Bloomberg Gender diversity index for the 3rd year on a road. On Slide 6, We are also committed to the United Nations Sustainable Development Goals. It is not a rhetorical commitment, but it is reflected on our daily job.
We are the 1st fiber country in the OECD list. Digitalization is not only a key lever for social progress. Is also critical to decarbonize the global economy. We have been able in 2019 to avoid $3,200,000 of TCO2 to the atmosphere for our customers. Our sustainable business model is based These revert to great efficiencies, which together with Renewable Energy is placed as a benchmark in our sector.
Thanks to this, the energy consumption per unit of data traffic has decreased significantly to 72% compared with 2015. In Europe and Brazil, 100% of the electricity in our operation is already renewable. We reduced by 50% in 2019 compared with with 2015, reaching the goals we had set up for 2025. It is remarkable that we are one of the few telcos all over the world that are committed with a 1.5 degree scenario, searches scenario, which has been validated by science based target initiative. But our final goal is to create trust capital with all our stakeholders.
And this is why we are committed with gender equality with 26 to women in management policies and 30% in our Board of Directors. Turning to Slide 7. You can see the consistent and solid growth track record. We have shown across all fronts during the last 6 years. Highlighting revenues growing on average about 3% over the period and OIBDA at 2%.
Sustainable business models, hence, shareholder value must be supported by growing free cash flows. With reaching 2019, the record high free cash flow since 2013 at almost 1000000000. This strong cash generation is the main driver of net debt across the period to 1,000,000,000, bringing down leverage to committed with our investment grade credit rating. Including post closing events, net debt would reduce to approximately 1,000,000,000 15,000,000,000 less than in June of 2016. And as Laura will explain later, We have not only reduced the net debt.
We have also extended its life, reduced its costs, and granted fixed rates at current low levels for the long term. Strengthening our capital structure. Moving to Slide 8, we can see our growth profile and global reach. We offer our products and services to 344,000,000 customers. And as you can see in main metrics, we posted growth revenues, OIBDA, OIBD minus CapEx and free cash flow.
This was thanks to the efforts that during past years in company transfer and investments. On Slide number 9, let me go over the main proof points achieved in 2019 regarding our business sustainability. During 2019, we drove a consistent commercial performance with ongoing strong momentum on high value accesses, 18% more in LTE accesses and 8% more in fiber to the in fiber and cable accesses. Our growth in strategic accesses supported the 4.3 average growth in revenue per access in organic terms versus 2018. Loyalty continues to be Three examples of improvement in customer lifetime are 8 year in mobile contract in the UK, 6 years in O2 Free in Germany, and 5 years in convergence in Spain and in mobile contract in Brazil.
Network Leadership is as well key for an improved digital customer experience. Net Promoter Score finished the year in 21%, one percentage point year on year improvement. Moving to Slide 10. All guidance metrics were achieved in 2019. And we surpassed the target revenue growth of 2% as we ended growing 3.2% in organic terms.
OIBDA grew 1.9% in line with the guided around 2% and CapEx to sales stood at 15% as target. We confirmed the 2019 dividend of with the second tranche to be paid in June 2020. As you can see in the slide, right hand side chart, our dividend is more than covered with free cash flow per share of an underlying EPS of. Finally, our dividend yield stands at 6.4% with share price of the last Friday. I now hand over to Angel to go through detailed review of the business performance.
Thank you, Jose Maria. Turning to Slide 11, the key financial highlights for 2019 are: revenues topped 1,000,000,000, growing organically 3.2%. Underlying OIBDA reached almost 1,000,000,000 while reported OIBDA was 1,000,000,000 increasing organically 1.9%. Underlying net income and EPS reached EUR 3,600,000,000 and per share, respectively. Free cash flow reached 1000000000, up 20.6% versus 2018.
Net debt decreased 8% versus December 2018 to 37 point 1,000,000,000. And CapEx over sales stood at 15%. Turning to Slide 12, We look in more detail to our financial performance. Reported figures have been affected by non recurring factors, which Lauda will explain later. During Q4, steady organic revenue growth continued with all segments, but ispam north in positive.
As for the letter, as you know, we have recently announced a transformational new model in Mexico that will allow to reverse operating trend. Furthermore, and thanks to our investments in the past years and our innovation efforts, it is worth to highlight that our revenue mix continues transforming As such, 55% of our total revenues come from broadband and services beyond connectivity. 3 percentage points more than a year ago, with digital services reaching 1,000,000,000 in the period January to December. Up 17% versus 2018 in organic terms. Revenue performance comes along with efficiency savings that are increasingly visible.
In fact, we have overachieved by digitalization efficiency savings target for 2019. This and other savings and overall execution on key drivers plane OIBDA performance, growing organically 1.9% in the year. On slide 13, we can see that same store investment in Network And Systems, we have closed 2019 with a strengthened leadership position in fiber to the home coverage. And the largest ultra broadband footprint in Europe and Latin America with access to 128,000,000 premises passed, of which 56,000,000 are owned. In addition, we continued signing network sharing agreements in the UK, Germany, Brazil and Mexico, while switching off our legacy networks.
Digital services continue to deliver strong revenue growth at close to 20% year on year in 2019, already delivering almost 1,000,000,000 of revenues, which IOT with IOT in the lead growing at a 45 percent rate. Finally, 40 products based on artificial intelligence and big data have been deployed during the year, on standardized capabilities and services such as device recommender and personalized offers have been launched. Slide 14 shows the end to end digital transformation program acceleration, which allowed us capture more than EUR 420,000,000 of savings in 2019, largely above the target of more than EUR 340,000,000. Additional to those captured in 2018. In sum, more than 2 thirds of the $1,000,000,000 savings commitment under the 3 year 2017, 2020 program has already been completed.
Digital sales in increased by 28% year on year in 2019 with agile improving the time to market and campaign effectiveness. Calls to contact centers were reduced by 13% versus 2018 and more than 1500 robots were deployed in 2019 with a significant impact on both quality of service and efficiency. Moving to Slide 15, we look at the B2B segment, 1 of Telefonica's superior growth drivers. The B2B segment accounting for 26 percent of group revenues in the 4th quarter is leveraged on core digital on our core digital offer, to provide communication, cloud and security services to corporates and reached with owned and third party value added services. B2B Digital Services as the main growth engine delivered solid revenue growth of 26% year on year, to EUR 2,200,000,000 in 2019, mainly in cloud, IoT and security, where we enjoy a distinctive profiling.
Moving to Slide 16, we review the solid and sustainable performance of our Spanish operation. Telephonic Casagna closed 2019 with a larger and better quality customer base. We have grown both of both our convergent customer base and ARPU. At the time, most of our peers struggled. Our differential positioning supports increased value of our customer base as well as improved returns and investments, particularly in fiber.
We have already passed more than 23,000,000 premises with fiber to the home, and uptake levels stood at 28% at the end of 2019, two percentage points above those of the previous year. As such, financials continue pointing in the right direction. Service revenues have grown for 10 straight quarters and by 0.6% year on year in 2019. With OIBDA back to growth in organic terms at the end of the year. We've seen a competitive environment, our best in invested company continues to deliver benchmark margins and robust OIBDA minus CapEx.
1000000000 in 2019 in underlying terms, a 27% operating cash flow margin. Moving to Slide 17, Telefonica Deutschland is accelerating its commercial momentum. And reported strong operational trends. The company continued growing its customer base by a combined 2% year on year, and reduced mobile contract churn by 0.3 percentage points to 1.5%. The business has achieved a good rating across the mainstream network tests, evidencing the improved network quality and customer experience.
Revenue growth in 2019 was 1.1 percent, mainly driven by the good traction of the O23 portfolio, somewhat offset by ongoing regulatory impacts. OIBDA declined by 1.1% mainly impacted by regulation and further investment into the positioning of the O2 brand. Full year CapEx increased by 8.1% year on year on LTE rollout further enhancing the customer experience. Moving to Slide 18. Telefonica UK posted a 14th consecutive quarter of year over year top line growth.
Once again, the company confirmed its market leading position as the UK's favorite mobile network with sector leading customer loyalty at 1%. Full year 2019 fiscal year 2019 revenues strongly grew by 3.8% and OIBDA posted a solid growth of 2.3% Overall, Telefonica UK has delivered strong and consistent outperformance over the last few years, reporting CAGR 17 19 or 4 percent for revenues and more than 20% for the ETA minus CapEx. On Slide 19, we review our Brazilian operation. Once again, Telefonica Brazil showed a stellar set of results in this quarter. Backed by a more rational competitive environment within a macro environment that should gain further growth momentum in 2020.
Within this framework, we have reinforced our mobile leadership, maintaining a solid year on year increase in revenues, and accelerating both OIBDA growth and margin expansion. Mobile market share reached 32.9% as of December 2019, the highest since 2006, supported by our differential assets, and we continue widening this quality gap through accelerating our CapEx efforts. Likewise, we remain focused on revamping the fixed business by accelerating fiber deployment and connections. Allowing fixed broadband ARPU to increase by 10% year on year in Q4. Revenues rose by a remarkable 2% in 2019, thanks to the successful execution of our more for more strategy mobile, the higher rationalization in the market and by high growth fiber performance that more than offsets the legacy business performance and the negative impact of regulation.
It is worth to highlight that fixed revenues have grown sequentially by top line growth, coupled with efficiencies and the ongoing digitalization process, allowed free cash flow to increase 19% year on year in 20 team. Moving on to our East Palm operations on slide 20. In East Palm South, Revenue and OIBDA showed a sustainable upward trend as a result of tariffs update in Argentina, overall growth in contract and fiber accesses and the efficiencies achieved from simplification and digitalization process. All of these more than offset the tough competitive environment in the region. In the North region, we highlight the annual revenue growth seen in Mexican, Colombia in Q4 and the strong improvement at the OIBDA level positively impacted by tower sales within are already announced intention to crystallize shareholder value from our infrastructure.
It is also worth mentioning that we reach agreement with AT and T during the quarter, under which the latter will provide wholesale last mile wireless access to Telefonica, Mexico. The new operational model of Telefonica, Mexico, allows a more efficient and sustainable use of resources and is expected to have an annual positive impact on free cash flow of around 1,000,000 from year On slide 21, we review Telxue's solid results in 2019. Tower portfolio significantly increased with 512 hours built and 15.57 hours acquired from Telefonica in Spain, Peru and Chile during the year, including the agreed purchase of 1900 Towers from Telefonica in Brazil, Telxius portfolio will exceed 30,257xius closes 2019 with a tenancy ratio 1.36 times, with 3rd party tenants having grown by 48% since its creation in 2016. Both revenues and OIBDA, again, posted sustained growth in 2019, and we are proud to show the consistent high single digit outperformance Over the last few years, with CAGR 1719 surpassing 7% in revenues and OIBDA. I now hand over to Laura to continue the review of the business performance.
Thank you, Angel. On Slide 22, you can see OIBDA performance was as well affected by non recurring fab such as restructuring charges that will bring further efficiency, the impacts of the transformation of the operating model of Telefonica, Mexico, following the agreement we AT and T and the impairment of telephonic Argentina. Capital gains from Central American Assets And Data Centers stinging from our portfolio optimization are also included. As such, all these factors deducted in q4 close to EUR 700,000,000 at the OIBDA level and EUR 1,200,000,000 in net income. While in 2019 reported figures decreased by EUR 1,900,000,000 and EUR 2,400,000,000, respectively.
Moving to Slide 23, we see FX, mainly Argentinian peso depreciation versus the euro dropped EUR 1,700,000,000 in revenue, EUR 500,000,000 in OIBDA, but just EUR 200,000,000 in free cash flow in 2019. At the net debt level to imply an increase of EUR 300,000,000. Let's now move to balance sheet metrics on Slide 4. Our net debt is reduced to EUR 37,700,000,000, declining for the 11th consecutive quarter in a row. Annual debt reduction of 1,000,000,000, mainly due to a strong free cash flow generation growing by almost 21% year on year, coupled with inorganic measures.
Once post closing events are taken into consideration, net debt figure could stand at around 1,000,000,000. Lastly, let me mention that when putting together free cash flow and net disposals, we have reached a figure of EUR7 billion. Slide 25 shows our proactive and broad financing activity. 1,000,000,000 in totals in January 2019 to date, allowing us to extend our average debt life over 10 years, while achieving the lowest coupons ever in recent deals. As a result, our effective interest payment cost stands at 3.49% as of December 2019.
That is 45 basis points lower than in December 2016. Our percentage of fixed rate debt is 75% and we have a strong liquidity position relative to our maturity profile. In summary, our balance sheet continues to strengthen on a quarterly basis as seen during all of 2019. Just put in context that the net maturities that we have for the next 3 years months. On Slide 26, we wanted to share a key data points regarding a hybrid management execution to highlight again the improving term trends in our debt profile.
Over the last nine quarters, we have been the most active issuer in terms of hybrid liability and we have replaced a total of 1,000,000,000 in high rates increasing our non call based average life at almost 1 point 5 year and more importantly, substantially trimming our hybrid cost by 200 basis points to 3.74 percent, achieving EUR 150,000,000 in annual coupon payment savings. In January of 2019 sorry, 2020, we issued the 1st green bond in the sector globally. No, sorry, in January 2019, we issued a 1st green bond in the sector globally. And in January 2020, we have become the first telco to issue a green hybrid bond. I will now hand back to Jose Maria to recap.
Thank you, Laura. Turning on to next slide. We believe it is time to commit for growth on the long term. While also reassuring on 2020 outlook. But before doing so, as we will show on the next few slides, we believe our guidance on this, our new guidance excludes the contribution to growth of Argentina.
We believe This is consistent with the new Telefonica and with a higher focus on the core and removes an element of volatility. This lower for longer approach is aligned with our new focus. As shown on the upper table on Slide 27, 2019 revenues and OIBDA growth, excluding contribution to growth in Argentina, would have stood at 0.8% and 0.5% respectively. With CapEx to sales of 15.2 percent. This is the new base for both 20202022 guide At the bottom of the slide, you can see that all our four business lines showed strong performance in 2019.
Moving on to slide 28, we are ready to commit for growth in the long term. When we announced our new action plan last November, We share with you that new measures will generate among all those effects more than 1,000,000,000 of additional revenues in cloud, IoT, big data and cybersecurity, and 2 percentage points increase in OOTA minus CapEx to revenues by 2022. This increased focus on our growing digital service portfolio, along with further data monetization on more valuable and engaged customers, allow us to guide for revenue growth in 2019, 2022 period. At the OED minus CapEx to revenues level, we expect a 200 basis points improvement from the 19.9 percent margins reaching 2019 over the period on the back of extreme digitalization. And ultra broadband allowing for legacy switchoffs and more efficient and environmental operations.
We aim to accelerate growth, efficiency and sustainability, whilst crystallizing value and to achieve this goal, simplification is a must. Issued a low unparalleled business transformation, second to none future infrastructure as under free cash flow profile, and improved capital structure, all aimed at improving shareholder returns. 2020 guidance, excluding contribution to growth in Argentina and operations in Central America, will continue delivering growth. While combined with a stricter capital allocation and portfolio management within the new Telefonica, all shown on Slide 29. Accordingly, we look for stable revenue, OIBDA and OIBDA minus CapEx to revenues and a sustainable dividend of We will continue to execute our strategy going into more detail about our 2022 guidance on Slide 30 and show from where this more than 1,000,000,000 of additional revenues will come from.
We are developing our already relevant position in security, IoT and big data and cloud, the key business levers are. In cybersecurity, we will automate operation and span soc capacity, reinforced sales force in B2B, the brand and product team. At the same time, we will enter a new products and service category like fraud or IoT security and capture internal businesses. So we will activate countries with high opportunity in our footprint. And markets outside footprint.
B2B Information Security market is expected to grow at a 9% compounded average growth rate between 2019 2022 within our footprint according to Gartner. In IoT and big data, we are already a recognized leading IoT player with cutting edge platform and analytics in big data. We will continue this for making tailor made solutions to specific industries such as retail, mobility. Thus, we will accelerate revenue streams beyond connectivity, leveraging in house platforms and partner ecosystem. In cloud, we will deploy new businesses like Edge Computing And Cloud Network Services to have the best in class multi cloud portfolio, more than 900,000 Outlook 365 licenses are leading and software as a services portfolio.
With a strong professional and managed services to help our clients migrate to the cloud. On slide 31, we highlight how we aim to achieve a new level of simplicity. We are looking for operational excellence. So first, we will streamline the corporate center being more simpler and more efficient. How?
We will refocus key functions prioritizing differential value adding activities for other units linked to new operating models in telephonic attack and telephonic infra and key markets. We will extract value from synergies and economies of scale. 2nd, we continue optimizing the use of assets with mobile network sharing opportunities, legacy shutdown in all operations. Copper decommission is well advanced in Spain and in LatAm is kicking off. In mobile, 2G is at a minimum across countries and 3G will be transferred to 4G.
3rd, digitalization efforts will along with automation for driving commercial and back office efficiency. The key axis, 1 simplifying processes improving commercial efficiency and focus on customer experience such as digital channel and assistance. To recap, please move to Slide 32. We are creating a new model for Telefonica that starts with the implementation of an action plan where we show our commitment with with a proven sustainable model. We are developing the settings to capture new growth opportunities in areas of higher potential.
Where we are already established players. And we are taking steps to gain agility, so as we can accelerate the execution whilst being more efficient. This new model is leveraged on the foundation we have built during our recent transformation journey, such as ultra broadband Massification and digitalization, that coupled with a return on capital employed driven portfolio managed position us to deliver meaningful progress on our outlook for the next years. And now we are ready to take
you.
You.
And if possible, we recommend you do not use your cell or hands free phone. Our first question comes from the line of Jacob Blumst1 from Credit Suisse. Please go ahead.
Hi, good morning. I had a couple of questions please. Firstly, on Spain, can you maybe give us a little bit more some insight into what your expectations are on the outlook. The KPIs did seem to weaken a fair bit during Q4. Your convergent subs and broadband subs both shrank.
There was a bit of
a deterioration in consumer revenues as well. Maybe share with us what do you expect to see in terms of sort of commercial performance in Spain during 2020 and also what should we expect terms of revenue and EBITDA for that segment? And then just secondly, your medium term guidance is for growing revenues, but for 2020, you're guiding for flat revenues. Could you maybe give us a little bit of a sense of when do you think the business will actually start to accelerate on the back for these initiatives? Thank you.
Thank you, Jacob for the question. I'll take the one on pain. First, we were touching upon the commercial performance. Here, what I can say is that the Q4 operational performance was impacted by the end of promotional periods, especially at the beginning of the quarter. This was in October but it showed recovery signs as the quarter improved.
Churn was stable, from the previous quarter compared 6%. But if one looks within 2% in December. At the same time, we managed to increase the convergent ARPU to 88.4. That's a plan 0 0.2% year on year ramp up of O2 subscribers is going up. We kept on improving the mix of broadband subscribers to fiber within the mix.
So in all, this was a quieter quarter commercially, but ARPU was up. The mix was stable. The churn was also stable and we managed to improve our revenue share. When we look into 2020, What we see is a continuation of certain trends. So if you look 2018, we promised to deliver revenue growth in our Spanish operation, which we did Then in 2019, not only did we reach revenue growth, but we accelerated the rate of this revenue growth and we delivered OIBDA growth, positive OIBDA performance in organic terms.
So when we look into 2020, what we see is a growth in tea accesses, in value accesses, We see growth in digital services. We see the benefits from launching new services, and we see a positive continued outlook for B2B and Wholesale. Revenues. This should support the evolution of the top line. At the same time, In OIBDA, what we see is that the benefits from corporate decommissioning and digitalization will continue On top of improved trends in other cost lines, for instance, personnel the benefits from the latest restructuring program that started flowing in November December will get full year impact from the 1st stage of 2020.
And also the cost of content that you saw basically stabilized already in Q4 is going to stay stable quarter on quarter getting into 2020. CapEx and CapEx intensity in Spain is stable you should not expect any increase in CapEx, intensity in Spain. So our expectation and this is not guidance, but this is the trend that we see is that we are aiming for operational cash flow growth in our Spanish operation.
Back off going to your guidance question. 1st, please remind that we are excluding Argentina this time. So we have changed the criteria and 2019 revenue and OIBDA growth excluding Argentina and Venezuela would happen stood at 0.8% and 0.5% respectively, with CapEx to sales of 15.2%. And this is the new base for both 20202022 guidance. Based on that new criteria, we are basically guiding on continuing delivering growth, while combining with an stricter capital allocation and portfolio management within the new Telefonica.
This is a stable revenues, OIBDA and OIBDA minus CapEx to revenue. But we are also ready to commit for growth in the long term. We are more visible through providing both short term and long term guidance. When we announced our new action plan that Jose Maria commented, we share with you that the new measures will generate among other FX more than 1,000,000,000 of additional revenues in cloud IoT, big data and cyber security. You ask about revenue, but let me remind you that we have also committed to 200 basis points increase in OIBDA minus CapEx to revenue by 2022, but focusing on revenue and the acceleration you talked about, our acceleration will precisely come from executing on the former strategic decisions.
The increase focus on our growing digital service portfolio and on with further data monetization on more valuable and engaged customers will allow us to fulfill this revenue growth guidance in the midterm.
Thank you. That's helpful.
Thank you, Jacob. Next question please.
Our next question comes from the line of Michael Bishop from Goldman Sachs. Go ahead.
Thank you. Good morning. Just two questions please. Firstly, if I could just follow-up on the guidance question. So if you're guiding to stable for 2020 and we look at the Telefonica Germany guidance which is stable to, I think, slight growth in EBITDA.
And then expectations, I think that Brazil will continue to deliver fairly strong growth. Could you just give us a little bit more color on how we should think about the Spanish and also the UK outlook within that stable growth outlook for 2020? And then my second question is, we've had various news articles around the Hispam process. But I was just wondering if you could give us a bit more clarity from your side. Is it a case of all options are on the table for Hispam?
Or are you focused on a more holistic approach there? Or could we see a sort of piecemeal approach to the asset portfolio.
Yes, to reiterate on what was said in a preview response on the Spanish outlook, We see elements that make us feel supportive that top line should be progressing as what we have seen in 2018 2019. This We see an environment of similar competitive pressure, but focus on the low end. In conversions, we see a solid performance of ARPU. We are adding new services within Fusion. The O2 base We'll keep on growing and this is a small drag on the comparison output.
By spite of this drag, we are increasing and we expect to increase the ARPU of convergent products. In mobile postpaid, we see similar trends as 2019. Fiber, you will see increased penetration with the benefits that it has both at revenue and cost level. So which is support on the trends in the top line in Spanish business. This combined with efficiency coming from the corporate commission, the digitalization, the better trend on content cost, and the further personal efficiencies are also supportive of OIBDA and then stabilization of CapEx.
Make me, if I was a betting person to bet that operating cash flow group increasing. At the same time, in the UK, we have been seeing top and bottom line growth for the last 3 years, several quarters in a row of growth and outperformance in the market. At the same time, but we see a very competitive market with increasing regulatory intervention. So We may perceive headwinds increasing in our UK business, but we expect to continue outperforming the market.
Michael, regarding this ban, we have a new organization and dedicated team already in place from December We continue to focus on the improve of the operating performance of ROBs in Hispant, but at the same time, we are analyzing all inorganic alternatives. We have advanced in the operative carve out and we are preparing for a potential financial carve out. This process as you can imagine is generating a lot of attention from third parties. So we are in parallel having multiple conversations with potential for in market consolidation synergies. Since November, we have obviously prioritized the options and are working actively on some of those alternatives.
We will decide based on value creation and also execution certainty and timing.
Thank you, Michael. Next question, please.
Our next question comes from the line of Karl Murdock Smith Berenberg. Please go ahead.
Hi, thanks very much. I was just wondering, could you possibly provide us with the mix of Spanish converged customers between the high mid and low end that you provided in previous quarters. And then secondly, just in terms of the visibility of Telefonica Tech and Telefonica even for it, are you contemplating changing how you present your financials or you continue with the current country splits?
Regarding the first question, high end of Fusion. The way that we define high end, which is the products that have retail prices between EUR114. 194 is 30%. Then mid end, which is 27% of the customer base, these are products that have retail prices between 109. And then what we define as low end is 43%.
What we define as low end has an average ARPU, which is the average overall ARPU of our closest competitor. These are products of prices between 50 Then regarding take an infra, first on infra, At this moment, the asset, which is within the portfolio of Telefonica infrastelcios, that is already disclosed as one of the segments of our business. So we will continue the same disclosure. By the way, this unit is now if one were to look at OB is the 5th highest, valuable in terms of enterprise value. Within our group.
As Telefonica infra progresses, it will become a portfolio of equity takes some of the majority, some of them can be minority in infrastructure assets with a wholesale approach open to all competitors in businesses such as towers, summary cable fiber, which can be fiber between base stations to support holly mobile or fiber to the home and also, maybe in a later stage, data centers for edge computing. These are the categories that we are looking at, but in terms of reporting, which was your question, we will continue to report themselves in the same way.
Let me just complement that probably during the first quarter, we will adapt our results presentation to the action plan that we are in November. So we'll give more visibility, not just to the infrastructure that Angel just mentioned, but also to tell telephonic CapEx.
Our next question comes from the line of Matthew Robert from Barclays. Please go ahead.
Hello.
Hi, Matthew. Hi. Can you hear me?
Can you hear me? Sorry. First, I had a question about your guidance for EBITDA in 20 following up on the previous question. So if we line up the tailwinds you have, you mentioned that if I heard correctly, Spain revenues would be broadly stable and you have some positives in terms of the costs, notably on personnel. I think you had mentioned that Q3 that you could have a tailwind of more than 1,000,000 cost savings in 2020.
As was pointed out earlier, Brazil should be growing Germany at first flat. Yet you come up with a guidance for the full year, 20 EBITDA flat. So I was wondering what are the negatives that will be offsetting all of these positives? And there's also the reduced spectrum fees in Mexico. So maybe if you could give a little bit of color on the negatives or maybe you're just being very cautious here and why in that case And then a second question with regards to Espano America.
Chile and Peru, so some deterioration in the revenue trends. Obviously, the political situation in some of these countries have been tough. I mean, are you already seeing an improvement in 2020 in these two countries? Thank you.
Hi, Matthew. At the risk of repeating myself, introducing the guidance published by Germany of broadly stable to slight growth, Brazil. Also presented results yesterday with a constructive view. At the same time, I've been describing how we see the outlook, which is not guidance for the Spanish business. Again, we see supportive trends and we believe that operating cash flow should grow to grow as a combination of supportive trends in revenues for ETA and stabilization of CapEx.
Also spoke in a previous question 2 headwinds that we are seeing in our UK operation. And the environment in certain Eastern Eastern countries continues to be challenging. Telstra, will continue to be supportive towards OETA and revenue growth.
Regarding the question on Peru and Chile in Peru, let me highlight that part of revenue performance in Q4 is associated to the lower margin revenues handsets and some B2B ICT. If you look at the pure, I mean, the higher margin revenue, it's definitely going in the also in Peru, we have had extraordinary disconnections. Otherwise, the churn would have been similar to previous quarter. And when you clean all of that, we should have had net adds positive in all of the services. So we are working on that very actively.
And I think it's in the right direction. We are focusing much more on our converged proposition there and also on retention. In the case of Chile, definitely the social situation has affected us, mainly contract, but we are starting reaching a floor in some of our services for instance prepaid. But let me tell you that the strategy we are following in Chile and Peru is similar to all in Spanish, regardless the macro situation regulatory is still hitting precisely more in Chile and Peru than in other geographies and also competition, we are building our contract and fiber and pay TV with a new technology and lower churn as fiber has grown in his funds out by 17%. And that's the basis for the future.
So we are sustainable we are building a sustainable value access base for the future. We are working a lot on efficiency. So you see the OIBDA performance compensating part of that revenue headwinds and we are also working on differentiation. We definitely need to get out of the pre the competition just on pricing. We are putting lots services in place, Movistar Play already have 1,300,000 active users.
If we talk about registers, it's 2,000,000 and it's a platform we just launched a year ago, we are doing data sharing family plans. We are improving the digital interaction with our customers through Novoans. So we are definitely working on a sustainable business model going forward. So to summarize Peru, affected by low margin and also this connection, Chile, it's been a full quarter due to the social. We are seeing some improvement in Q1, but it's still soon to see as some of the social situation remains.
Thank you, Matija. Next question please.
Our next question comes from the line of Joshua Mills from Exane. Please go ahead.
Hi there. Thank you for taking the questions from me. I'd like to ask one on the factors going into the guidance and one on your strategy in the UK. So if we look at the guidance, what have you built in thus far for and the potential wholesale revenue losses if Orange were to expand there, 5 to the home footprint in Spain has been reported. And also what's been built in for the potential launch of Musculptails nationwide expansion and then bringing to the market of new conversion sub brands by orange.
So it'd be great to get a sense of how much of a buffer we're in for those, those 3 factors. And then secondly, on the UK, I know the message has always been that this isn't as commercial market in Spain. We don't need to have fixed line access, but in Germany, you're doing quite well in the UK, clearly the mobile market's under more pressure. And there's an increasing number of alternative operators you could work with at the same time as Virgin and BT are pushing convergence. So has there been any revision of your strategy regarding U.
K. Fixed line and convergence be great to hear what the options are.
Your first question are linking guidance with wholesale revenues in Spain. I should say that guidance is expressed at group level. We do not guide on on a specific revenue lines, on
a specific
OBs. Having said this, I can give you the trends that we are seeing in the wholesale business in Spain. The wholesale business in Spain accounts for 18% of our service revenues. It is experiencing and posting year on year growth, which is positively impacted by Neva, wholesale fiber and TV of the wholesale revenues that we get from selling content to other operators. And this more than offset the bundle local loop decline in copper and some nonlinearity of other revenues.
So, we have been experiencing substantial growth in wholesale revenues, of 12% year on year, which is higher than what we saw in Q3. And again, TV sale and EVA upside continue to be there. So we see positive trends in the wholesale results. With respect to fiber sales by other players, I should say that we have reached agreements with Vodafone, with Orange, with Mossmobile that support the trends that we are seeing in the wholesale business. Regarding strategy in the UK, we continue to have an outperformance in the market.
We see conversions being not demand led, but more supply led. It's progressing, but very steadily, if I would say, but slower than what we have seen in other markets such as Spain and others were asked from the supply side drove the increase in convergence. Of course, as we move into 5G, more fiber is going to needed in order to have backhaul for the aggregation network and here we are in talks with all the players that can supply us with this backhaul fiber for the aggregation network to cope with all the data that will come within 5G. And in this sense, we're already in active talks with other players in order to have the economics for access to this backhaul fiber. We continue with our mobile centric strategy.
We have some hedges with respect to a conversion moves such as the BNO agreement with Sky and we will continue monitoring the market developments as as they move. But our expectation, again, is within a competitive and regulatory impacted scenario in the UK, we expect to continue outperforming the market and continue to be the mobile operator of choice for the cash numbers in the UK.
Our next question comes from the line of Sumas Dasha from New Street Research. Please go ahead.
Hi. I've got two questions, please. Just first of all, on Brazil, could you give a sense as to what process that may be taking place regarding consolidation, expectations, or we might be looking to sell it's wireless business. Is there any kind of process underway? Do you have any ability to kind of proactively drive that process from your perspective, please?
And then secondly, just I guess on the share price and on the buyback, as every quarter goes by pretty much you're deleveraging the company The shares are kind of hovering just over the €6 level, to what degree are you inclined to consider a buyback at this time?
Regarding your first question in Brazil, the first thing I should say is that our Brazilian operation has posted 1 more quarter and 1 more year of outperformance with respect to the market achieving the best OIBDA margin ever having the highest market share of contract customers of the last years accelerating the growth in revenues, accelerating also in expansion and with a 19% growth in free cash flow. So we have very good performance in Brazil. At the same time, we have always defended that the market consolidation would be a positive, not only for the competitive environment, but also for the customers in Brazil, especially when there is still investments to be done in such a country that has a continental size. We think that market consolidation would be possible, but none of the 3 players in Brazil would be capable of doing it alone. One could look at OI Mobile from a double point of view from the spectrum and from the customer base.
With respect to the spectrum, it's public positions of the different players, there are also spectrum caps in Brazil. And this would imply that probably 2 players could be better suited than the remaining 3rd player to approach this from a spectrum point of view. At the same time, the second element is the customer base. Always customer base is mostly prepaid, Anatel publishes the regional market shares. So one could clearly see how the market share could be naturally split, if there was going to be an end market consideration, be it through a consortium of payers or be it through remedies back to back between the players.
It's a complex process. We can it's very difficult to proactively accelerate it or it's still under some judicial oversight. So they need to be extremely careful and they are doing very nicely to go with for all parts involved, but the process is moving slower than what we had expected. We remain interested We thought that this would be more of some speed dating and it probably will turn out to be some slow motion dance, but we continue to be
interested. Taking your question on potential share buybacks, currently we are not analyzing any significant share buybacks. We will certainly do so once we feel comfortable with the reduction and leverage profile, we have reduced debt significantly in the past few years. In fact, close to EUR 16,000,000,000. And we are committed to reduce debt going forward on the back of the strong free cash flow generation we are having and therefore, we aim to maintain a solid investment credit rating.
But we are also analyzing very significantly in measures to be that we are executing. And therefore, we think we are getting closer to the moment where net debt will be less of a concern. And therefore, we will then rethink shareholder remuneration policy, including both dividends and potential buyback. In this respect, I think that we expect multibillion disposals in the coming future, farther value crystallization of infrastructure, reduce exposure to his pump, completion of the pending Central American Disposals, And certainly, that will help to beat that moment forward. You are totally right on equity free cash flow yield and share price are very attractive.
And definitely share buyback looks as a potential efficient use of our capital to improve return on capital employed, but we need to feel comfortable with with debt levels and credit rating agents.
Our next question comes from the line of Mandeep Singh from Redburn.
Thank you. I've got a couple of questions, please. First of all, on Germany, I mean, obviously we've seen the results. We've seen the guidance. I'm sort of really asking if you're satisfied with the financial and the management performance in Germany because the actual cash flow generation of the asset is quite poor.
And you've talked about having delivered the 1,000,000 of operating free cash flow synergies, yet the EBITDA minus CapEx of the total company is less than the synergies the company has delivered. So can you just talk a little bit about the cash generation there? Because if we adjust for spectrum costs, and obviously the higher CapEx now, there's very, very little cash generation and the dividend isn't covered. So just some thoughts on how you think about that into the medium term and how the cash generation can improve. Secondly, obviously, you referred to the gains from the copper shutdown.
I understand you've been giving notice now for 5 years. You just give us a few drivers of where the money is coming from? Is it from selling the exchange and realizing a real estate gain? Is it efficiency savings from no longer having the Can you give us some idea of the quantum and the sort of tenure of this? Is this going to be an increasing momentum in terms of how many central offices get closed down?
And will that rate of savings or gains be improving over the next multiple quarters? So just some more color on that, please.
Thank you, Mandeep. Regarding Germany, what we are seeing is that Germany is posting growth in and having a strong trading and operational momentum. This has not been the case. In the prior years since we did the combination with CPLAS. We went through process of integration that took its toll in the network consolidation.
Also, we had to agree to the remedies that led to the market conditions that, that you know, but Finally, we, in all the network, tests that we have in the market, we have not only network, but also in customer, in customer experience, we are achieving good ratings This is allowing us with some investment in our brand and the launch of TiO2 free packages, which are ARPA accretive to go back to growth. And Germany used to guide growth ex regulations. Now we are talking ex regulation impacts. Now we are talking about growth period without qualifying this, we have been able to reduce mobile contract churn by 0.3 percentage points. To one point 5 percent quarter on quarter.
And, we have to invest and this was but it was flagged by our German colleagues in the investor day that they had back in December. We are going to have to invest in the network for the next 2 years with CapEx Intensity and the forecast flow generation, normalizing on year 3. Regarding copper shutdown in Spain, we have around we have done around 500 closures of central switches in Spain, out of around 1500 switches that we have. So it's less than 10% of the switches that we have in Spain. This process is the result of having invested solidly and consistently in fiber.
In the country, which is allowing us now to reap the benefits in terms of efficiency and in terms of reducing capital intensity So here, we have benefits of divesting the copper itself. We have the benefits of being able to free up a real estate, real estate that can either be divested or can be reutilized for activities such as Edge. Computing. At the same time, the operation of a full fiber network is the fraction of the cost of operating corporate network, it increases customer satisfaction because the failures and also the ability for us to remotely address those failures with fiber is much enhanced compared to what it was with copper. So All of these are benefits that we're going to be seeing for the years to come.
As Jose Maria was saying, at the part of the presentation, we are going to expect to close all our copper switches before 2025. So you should be expecting us to continue this efficiency process in which we are pioneers in the sector globally And we would expect also other players to take this type of approach. In due course, you should see similar optimization of our network in places like Brazil as we grow our fiber network in the country. This will allow us, especially in the state of Sao Paulo, to conduct a similar
Thank you, Mandeep. Next question please.
We will now take our next question from the line of Akhil Dottani from JP Morgan. Please go ahead.
Yes. Hi. Thanks for taking the questions. If I could start maybe with the B2B market in Spain, please. You've actually delivered a strong quarter in Q4, but I was keen to understand the outlook beyond that.
And specifically, we've seen some comments in the Spanish press suggesting the public sector contracts in Spain. Starting to see some downward pressure. So specifically there have been comments around the police and civil guard contracts, which apparently been priced down quite hard and we've seen some of your peers coming to those contracts. So just I guess keen to understand what do we see in the public sector? Is this article accurate?
And is there a broader trend here or should we not put too much emphasis on this article? So I guess that's the first question. And then the second question, I guess, is pulling some of the comments you already made on Spain as a whole. And just focus on the Consumer segment. You've had a relatively stable performance to the last 12 months, but obviously Vodafone's been very poor.
And we've seen oranges trends deteriorating. So if I look at the market as a whole, it does look like the Spanish consumer market is currently declining. So I guess just keen to understand how you sustain your outperformance, at the moment, and do you see the market recovering or do you think the current market pressures we're seeing will sustain? Thank you,
Akhil. The B2B segment in Spain is accounts for 29% of our service revenues in Spain. It's been growing now for the 7th quarter in a row. On the back of excellent IT growth. This is the combination of 2 components.
1 is the communications revenue. Which is very competitive and shows a decline year on year of 3.3%. This is where the competition for renewal of contracts such as big corporate contracts or administration contracts, especially when they are based on just pure communications, we are seeing pressure in renewals. But at the same time, what we have is growth in IT. We have growth in digital services to the tune of 15 0.1% for instance, 51.1 percent year on year.
So, and this is, of course, supported by our capabilities in digital services for B2B. So the combination of these 2, a challenge and declining communication revenue, but a double digit growing digital services is supportive of the trend that we see of growth in the B2B segment looking going forward. On the consumer, and especially on the market environment, I should say that concerns about the competitive situation in the Spanish market, we feel are overton. We think that those concerns are exaggerated. The fact is that there is competition of course.
But this competition is quite intense in the low end of the market, and we have proven again to grow even this environment of competition. We have grown in revenues. We have grown very importantly in revenue share. While achieving the benchmark OIBDA and operating cash flow margins. The market is getting more polarized.
But we have a track record of successful anticipation and adaptation to the market conditions. We were pioneers in fiber. We were pioneers in convergence. We were pioneers in TV. We were pioneers in transforming the channels.
We were pioneers in switching off the copper with a fiber transformation. We are pioneers in launching new digital services. So we continue fostering different initiatives and we are looking for new opportunities. The environment, of course, is demanding and requires actions to to anchor our value customers and of course actions on efficiency. But we have been doing this 4 years, and we have many more levers, levers that we can play with and defend ourselves.
So we believe that this is the reality of the Spanish market and concerns are being overdone. We have a solid and sustainable model in Spain And you may think that these are words, but I can give you facts. So portability. Average mobile portability in the market has been around $600,000 per month in the last three years. 2018 was 6 1000 between $614,000 in 20.19, so stable to slightly better.
That's for the market. But for us, the average mobile portability for Telefonica, Espana, since 2014 is $28,000 per month. In 2019, it was, I guess, $28,000 per month. So stable. Total sector revenues in the market are flattish.
We are increasing our market share of revenues in the market. So we believe that we can navigate well and continue to create value and capture value in a market that is being more polarized, but where we continue to be strong in the value segment, segments of the market.
Thank you, Adi. Next question please.
Our next question comes from the line of Luigi Manavra from HSBC. Please go ahead.
Infrastructure strategy. And firstly, I wanted to ask you now what's your view about the ownership of TELxius and in general of Telefonica infra and whether you would consider giving up control in order to crystallize better value for the group? And secondly, looking at the UK, what are your options there particularly with regarding the CTIL? Thank you.
Taking your first question, we are really satisfied with our existing space in Telstra. So let me elaborate a little bit more. We think that, the way Telstra is being managed contributes to the strategy of the group. I mean, not just in terms of putting together all the towers and creating the value, something that, by the way, we did, starting years ago and some of our competitors are starting to think over now. But also in terms of co location, in terms of contributing to our strategy, in terms of contributing to generate a our revenues.
And therefore, the expertise that the Telxius management needs accumulated over the past year is a very valuable is going forward. So we don't think about reducing our stake in teleshears, but on the other we are significantly contributing more and more towers into Telstra's. As Angel has said before, I mean, roughly including the ones that we have signed with Brazil, a few weeks ago, it's 3000 towers more. So Telcio has now 20,000 towers. Therefore, it's a crystal and real asset.
That again, it has a significant value, but you should not expect from us to dilute our share. And we are also very happy with the existing shareholders partners in searches. We might think about crystallizing the value of purchasing different manners. And on that, we are talking with our partners, because we think that there is value on this kind of assets. Others, some of our competitors are lagging behind in putting together those units, we have that unit being created.
And we think we can accelerate the value, crystallization of that without having to reduce our, our stake. And remember that we still have more than 40,000 towers in within the Telefonica group. So the size that tells you and tells you would always be our preferred option to crystallize the value of those towers. So I think that going forward, you should expect from us to to realize more value through Telstra's without having to reduce our stake.
Regarding CTL CTL is a very attractive asset. It's a very unique asset in the UK. It has around 16,000 towers and monetizable towers. It's owned 50% by us and by Vodafone. We are in in a 2 stage process.
The first one is business preparation. The business preparation means converting a company that was wholly owned degree of the 2 partners, with a cost orientation mode, converting it into company at our company that has market conditions and a P and L of our company with all the arms length contracts with both the shareholders, Vodafone and ourselves and also ready to accommodate colocation of other players in the company. So we are almost finalized with the business preparation. So then we move to the 2nd stage, which is the monetization or evaluation of this asset. Now preferred route as Jose Maria was saying is to contribute it to Celsius when we contribute towers or stake of our company into use is, from our site, an equity contribution in kind and our partners are topping up the equity contribution in cash.
So we are monetizing the asset because we continue to consolidate that cash that is injected as equity by the partners into Telxius into our net debt figures, which reduces accordingly. So we are monetizing is weighed, but at the same time, the asset is generating lots of interest, from different players in the market. And, we remain open to alternatives with, again, that should have been our preferred route for this transaction because it allows us to achieve a double objective. On the one hand, monetize and the second one maintain the control of more and more valuable asset.
You, Luigi. Next question please.
Our next question comes from the line of Fernando Cordero from Banco Santander. Please go ahead.
And the first one is related with your strategy in LATAM. And in that sense, I would like to know, I would just stand your exposure to the informational wholesale business. And I believe it's quite relevant in the region. Could justify Telefonica route maintaining a minority stake in the in the LatAm, in the current Latin American operations either, if there's going to be a common number for the moly's it is going to be real, let's say, is that the utilization is not a country basis. And my second question is related with respect to investments in 2020.
Taking into account that those options, particularly in Europe are going to take place in low frequency band And also considering your recent decision in Colombia, although it's clearly not you cannot extrapolate the same situation in Colombia to European markets as you have from this auction. I would like to know what are your views and your behavior regarding this 2 spectrum auctions in Spain and UK? Thank you.
Hello, Fernando. Thank you for your question. On the international wholesale business angle that you mentioned, obviously, that's an important part, but that can be continue regardless any ownership structure with Telefonica Eastbank. In any case, with the decision we took in November, we want to increase the seasonality of our portfolio, but also to modulate our exposure to Eastbank. We are not saying that we will reduce our exposure to Eastbank completely, but rather reduce it as well as we are creating ways to maximize the value, both organically and inorganically.
So that's important piece, but obviously, there is not a critical part at the decision at all. And as I said, our line of thought is to using the exposure rather than decreasing completely.
With regard to your questions about upcoming spectrum auctions, we are going to apply the same criteria that we have been applying into different options. Therefore, it's a strict financial discipline. We have, team that has a significant expertise in valuing spectrum in the different. And you were right around the bands. It is also right that we need to also contemplate the spectrum of revenues in every single country.
So I cannot give you more visibility around that, but you can count that with the really discipline on those options.
Our last question comes from the line
Thank you very much. I have two questions, please. Firstly, I wanted to ask about fiber regulation in Spain. Could you update us on the CNMC a review of the competitive cities, what are the next milestones here and where do you see the number of these cities going, and what are the implications on Telefonica My second question is on your pricing strategy. You increased recently the price points on Movistar, which is very positive.
In particular given the market conditions. But at the same time, you continue to push O2 as well by introducing it to the shops, by flashing out the O2 portfolio with a number of new offers. So I was keen to better understand the positioning of the O2 brand. Is it all about retention? Is it more?
And more generally, could you help us understand and what sort of actions you have put in place to keep the cannibalization risk under control?
Thank you for the questions. Regarding the competitive areas in Spain, We're expecting the revision to be done finally by 2020. This revision is very much overdue. Estimate that the current number of total competitive downs to be more than 250 that would be exceeding 2 thirds of the population, but only 66%, which is 35% of the population are currently recognized as competitive failures and therefore unregulated. We think that the current market reality is not what reflected, but the competitive areas is outdated, but we are encouraged that by the fact that this review is going to be taking place during 2020 and we are confident that the regulator will reflect the market reality that has evolved pretty much since 2015 when the last review was done The second question, which was a long one.
I think that there was a part linked to the multi brand strategy. And if we fail to respond completely, please feel free to compliment the question. Our multi brand strategy is designed to shoot all market segments with a profile of positioning of channels and propositions, which is designed to avoid cannibalization between the different the different brands. We also are using this tool to compete in that segment of the market, which is more competitive while preserving our premium positioning of the Movistar brand in the upper part of the market. We are very satisfied with the performance of O2.
O2 is achieving very nice results over 175,000 fixed broadband subscribers, more than 350,000 mobile subscribers. And at the same time, doing it with a low churn of around 1%. So this is a positive performance, and you should expect us to continue using this strategy, especially given the polarization that we're seeing in the Spanish market.
Thank you very much. My question was I guess it's also about how do you keep the cannibalization risk under control is it used, is auto use only as a retention, or is it more? So the question, I guess, is how can you preempt this kind of decision risk going forward?
Well, one differential, clearly, this is the content which our Movistar Fusion propositions have different degrees of TV, which would not be the case of the propositions. So these are differentiated in terms of the proposition to the customer in addition to the differentiation of positioning, channels and segments to the market that it's address too. So we are using it and we are obviously, we have the information to monitor how potential cannibalization maybe happening, and this is not a concern at all for us.
Okay. Thank you very much.
Well, thank you very much for your participation. And we certainly hope that we have provided some useful insights for you. But should you still have further questions, we kindly ask you to contact our investor relationship department. Good morning, and thank you.