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Telefonica Arm Extends Tie-Up With Allot, McAfee to Aid SMEs

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Telefonica’s (TEF - Free Report) unit has extended partnership with Allot and McAfee to augment the capabilities required to safeguard Spain-based small and medium-sized enterprises (SMEs) through the Movistar Secure Enterprise Connection Service. Telefonica Tech is a global business providing the Group with the agility to leverage the rising demand for technology services including cloud, cybersecurity and IoT/Big Data.

The solution, managed by ElevenPaths — the cybersecurity company of Telefonica Tech and which works as a platform installed at the core of Telefonica’s network — helps to prevent employees from visiting potentially dangerous websites. It helps to protect employees’ fixed and mobile devices in case of loss and theft, even when connected to the Internet from outside the corporate network.

The deal will add the new version of McAfee MultiAccess that includes privacy control capabilities for 5 to 10 devices by usage licenses and the latest improvements of the Allot platform. So far in 2020, the number of SMEs in Spain subscribing to the service has tripled, exceeding the forecasts of the companies. This has enabled them to expand the platform almost three years earlier than initially planned.

SMEs are rapidly digitizing due to the current circumstances for business continuity. Since the end of March, despite the economic constraints imposed by the COVID-19 pandemic, customer demand has continued to grow at double-digit monthly rates. The Secure Connection Business solution gives them protection from the most common threats that come from the Internet.

Telefonica Tech aims to accelerate its existing revenue growth streams, making them more visible and increasing optionality. It has already inked agreements with global providers including Microsoft (MSFT - Free Report) , Fortinet (FTNT - Free Report) , Amazon (AMZN - Free Report) Web Services, Google and GE Healthcare. The company has invested in Nozomi Networks, a leader in industrial IoT cybersecurity.

On Sep 7, ElevenPaths announced the acquisition of iHackLabs, a company specialized in cybersecurity training. iHackLabs is a company that trains the level of expertise of the next generation of cybersecurity professionals. It has different cloud-based training platforms and labs under a SaaS model that simulate real cyber threat situations adapted to the specific needs of companies. The integration of iHackLabs followed the purchase of Govertis, a company specializing in cybersecurity consulting, as part of Telefonica Tech’s growth strategy in the security business.

Meanwhile, Telefonica intends to optimize value creation by prioritizing investment in its core operations (Spain, Germany, the U.K. and Brazil). The company seeks to optimize its Hispam operations to streamline its Group structure and core market focus, reduce exposure to emerging markets and foreign exchange volatility, and to accelerate its deleveraging.

Telefonica’s shares have lost 22.1% in the past six months against 13.1% growth of the industry. The company has a long-term (three to five years) earnings growth expectation of 17.8% compared with the industry’s 9.2%.

Telefonica has a Zacks Rank #4 (Sell), at present.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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