O2 seeks mobile ad and IPTV alliances

O2 is looking to ramp up its offering in areas such as mobile advertising and internet protocol television (IPTV) by investing in entrepreneurial companies as part of a new venture capital programme.

The initiative will see O2 parent company Telefonica make “strategic investments” in small, specialist businesses in three different sectors: mobile, fixed line (including broadband) and TV/IPTV.

O2 UK launched a broadband service earlier this year but has not yet unveiled its plans for mobile advertising or IPTV. Rival Orange already offers IPTV, while former Nokia president Pekka Ala-Pietila has just launched Blyk, a mobile service that offers free calls and text messages to users willing to accept ads on their handsets.

The Telefonica programme is being led by the company’s director of innovation Russ Shaw, who was previously O2 UK’s marketing director. He was moved to a similar innovation role at O2 before being promoted to the group position in the summer (MW June 14).

Shaw has already signed two deals with undisclosed companies – one of which is based in London. He says he expects to complete three more investments by the end of the year.

Shaw will be making investments on behalf of Telefonica’s three divisions: O2 Europe, Telefonica Spain and Telefonica Latin America.

The local operators in each country will act as sponsors of the smaller companies and in most cases will take a seat on their boards. Shaw adds: “If we can get closer to these companies it helps us gain a better insight into what’s going on in these areas. These businesses benefit from our global experience and in return we get to hear a more entrepreneurial point of view.”

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