Telefonica SA will become the first carrier to test AT&T’s Digital Life home-security service in Europe.

AT&T is partnering with Telefonica SA to be the first carrier to license its Digital Life home-security service, helping the U.S. phone company expand outside the slowing landline and wireless businesses. It's an interesting move and poses the question whether such an alliance could apply in the Australian market. 

Telefonica, the Madrid-based phone company with operations across Spain, the U.K. and Germany, will offer limited trials of the connected home service in Europe, according to an announcement today at the CTIA wireless industry conference in Las Vegas. AT&T’s Digital Life system allows homeowners to control wireless thermostats, surveillance cameras, motion sensors and other appliances through a mobile app.

Looking for growth beyond sales of wireless services to phone and tablet customers, AT&T has targeted areas including home monitoring and Internet-connected cars as potential $1 billion revenue opportunities.

AT&T, based here, has been trying to push into the smart-home market since introducing Digital Life more than two years ago, and Telefonica marks the first licensing deal since AT&T said in February 2013 that more than 30 companies worldwide had asked about the product, reports.

“There’s been interest on all continents,” Glenn Lurie, who was promoted last month to head AT&T’s mobile division, told Bloomberg. “Telefonica’s digital team is very innovative, and we are very honored they chose us. It bodes well as other carriers do the same due diligence.”

Telefonica is one of a number of overseas carriers that have approached AT&T about licensing the Digital Life technology, Lurie said.

AT&T started selling its home-monitoring service in 15 U.S. cities in April 2013 and is now in 82 cities. AT&T offers the service starting at $39.99 for basic alarm security, plus $149.99 for installation. AT&T hasn’t disclosed how many subscribers it has for the service, according to Bloomberg.