Telefónica's Fiber Optic Service Contract in Spain Cancelled by Spanish Government.

Telefónica, Spain's leading telecommunications operator, has had its fiber optic service contract with the Spanish government cancelled by Reuters. The company's activity is organized around mobile telephony, fixed telecommunications, and business telecommunications services. Net sales are distributed geographically across Spain, Brazil, Latin America, Germany, and other regions.

The Spanish government has canceled a fiber-optic service contract with Telefónica (TEF.MC) due to concerns over the use of equipment made by Huawei. The Digital Transformation Ministry confirmed the cancellation, stating that it was made for reasons of digital strategy and strategic autonomy [1]. The contract, valued at 10 million euros ($11.7 million), was set to provide fiber-optic connections to various government institutions, including the Defence Ministry.

Telefónica, Spain's leading telecommunications operator, has been reducing its exposure to Huawei equipment in compliance with EU recommendations to phase out Huawei-made devices over security concerns [2]. While some European countries, such as Germany, have implemented outright bans on Huawei gear, Spain has not, and Telefónica continues to use some Huawei equipment for its retail 5G mobile network.

The cancellation of this contract underscores the growing trend of European countries and telecom operators alike taking a cautious approach to Huawei equipment due to security concerns. The move by the Spanish government is part of a broader effort to enhance digital security and strategic autonomy in the region.

References:
[1] Reuters. (2025, August 29). Spanish government cancels contract with Telefonica using Huawei gear. Retrieved from https://www.reuters.com/business/media-telecom/spanish-government-cancels-contract-with-telefonica-using-huawei-gear-2025-08-29/
[2] Yahoo Finance. (2025, August 29). Spanish government cancels contract with Telefonica over Huawei gear. Retrieved from https://finance.yahoo.com/news/spanish-government-cancels-contract-telefonica-113011848.html