SAO PAULO -(Dow Jones)- The Brazilian unit of Spain's Telefonica SA (TEF) will switch all of its products to the Vivo brand of its mobile phone operator early next year, the head of the Brazilian operations said Monday. "There's a fixed date for the change, and that's the end of the first quarter of 2012," Antonio Carlos Valente told reporters at a conference. Changes to Brazilian regulations have allowed operators to merge their fixed-line and mobile operations, a process which Telefonica is in the final states of completing after more than a year of corporate restructuring. The final step is expected to take place in October, when the mobile-phone operator will be formally absorbed by its main local unit, Telecomunicacoes de Sao Paulo SA (TLPP4.BR), or Telesp. Valente said that after the lengthy corporate process, the emphasis will now move towards providing the benefits to end users. High on the list is the launch of a fixed wireless telephone service later this year, Valente said, while providing few details. The company will also target more locations and smaller cities, he said. One of the next big steps for Telefonica will be the approval of a new law which would allow it to provide paid television services. The law has been approved by Congress and is expected to be signed into law by President Dilma Rousseff soon. In 2006, Telefonica bought a stake in Brazilian pay television company TVA from local media giant Grupo Abril, under an agreement which would allow the Spanish firm to increase its ownership if Brazilian law is changed, Valente said. The existing law prevented foreign companies from owning more than a 50% stake in a Brazilian pay TV firm. Valente said he expects implementation of the law to take around six months, but that Telefonica is already preparing for the changes. He said there's huge potential for pay TV even in Sao Paulo state, as currently just 71 municipalities, out of a total of 645, have issued licenses to provide pay TV services. "There's plenty of room," he said. -By Matthew Cowley, Dow Jones Newswires; +55 11 3544 7082; matthew.cowley@dowjones.com
