Telefónica SA, one of Europe’s largest telecommunications companies, is eyeing expansion of its defense business beyond Spain as NATO and European Union allies ramp up military spending in response to growing security challenges.

Executive Chairman Marc Murtra said the Madrid-based carrier, which already provides critical network infrastructure to the Spanish army and security forces, sees opportunities to offer its expertise to “allied countries, whether within the European Union, within NATO or beyond.”

“We believe there will be European coordination to ensure there is no duplication of capabilities among allies,” Murtra told reporters, noting that Telefónica’s significant European presence in Germany and the UK provides a strong platform for expansion.

5G ‘Bubble’ for the Battlefield

Chief Operating Officer Emilio Gayo revealed that Telefónica has developed a prototype for a so-called “5G bubble” — a portable, high-speed private network capable of establishing a secure communications zone in combat or crisis scenarios. The company recently demonstrated this technology at a NATO event, highlighting its potential to enhance secure battlefield connectivity.

The 5G bubble is designed to provide:

• High-speed, encrypted communications in contested environments
  
• Rapid deployment for mobile operations
  
• Flexible integration with existing military and security systems
  

Shifting Strategy Toward Defense

Murtra has been outspoken about making defense and security a strategic priority for Telefónica. In June, he criticized the company’s historically low investment in this sector and pledged to accelerate growth in military-focused solutions.

Telefónica’s defense profile rose sharply in 2023 when Saudi Telecom Co., a state-controlled entity, acquired a significant stake in the company. The Spanish government responded by purchasing a 10% holding to safeguard what it calls a “strategic company for Spain” due to its close ties to national security.

Murtra, who took the helm in January after serving nearly four years as non-executive chairman of defense contractor Indra Sistemas SA, has since brought in Borja Ochoa, Indra’s former global head of defense and security, as president of Telefónica Spain.

A Growing Market for Military Communications

Telefónica’s offerings for military and security forces include:

• Fiber and satellite communications
  
• Military-grade private networks
  
• Cyber defense solutions
  

The move follows a broader trend among European telecom providers. Orange SA, for example, launched a dedicated Defense and Homeland Security division last month to address rising demand for secure communications systems.