Latin America's Business Information Leader
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Info. Technology Perspectives - a weekly summary
January 9 - January 15 2010
Click to read the online version:
http://www.bnamericas.com/perspectives_home.jsp?idioma=I§or=1&id_email=170272721
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In this issue:
* Weekly Wrap
* Q & A:Software exports to continue expanding despite crisis
Alvaro Lamé
President
Cámara Uruguaya de Tecnologías de la Información (Cuti)
Uruguay
* Coming Up
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** WEEKLY WRAP **
While the tragic news resulting from the Haiti earthquake overshadowed all other events this week, Chile trudged along in its development and accepted the invitation to sign on as the Organization for Economic Co-operation and Development's (OECD) 31st member.
But far from making the country part of the "wealthy nations club," as some have claimed, it will actually shake things up, so to speak, for Chilean corporations.
One of the main goals behind the OECD is to level the playing field internationally for companies by working to eliminate bribery. As such, corporations take on legal responsibilities for that which happens within their companies; before, these responsibilities were delegated to physical persons such as those performing the illegal actions, or the responsibility fell on legal representatives.
A day after Chile's signing on with the OECD, local IT security solutions provider Neosecure announced it had joined with consultancy MPScompliance and law firm Cariola Diez Perez-Cotapos to provide firms a preventative system helping companies to avoid the legal risk of taking part in crimes.
The three parties involved will bring their expertise - Neosecure in information security technology, MPScompliance in crime prevention and the law firm's corporate law experience - to the service of large firms.
Chilean IT industry association Acti recently called for the country to raise IT use to the level of other countries in the OECD, saying the organization represents a different league in terms of technology, placing the country in "the bottom third" of member countries in terms of IT use.
What other implications will Chile's entering this "elite group" have in the IT industry? Time will tell.
Also this week in IT:
Regional
- Large enterprises in Latin America are showing interest in hybrid versions of Oracle's on-demand CRM.
While solutions such as CRM offered through the software as a service (SaaS) model have traditionally appealed to smaller firms with less technological resources, larger companies are now adopting hybrid CRM with on-demand solutions mixed with traditional licenses.
The idea is to strengthen relations with clients, while also centralizing and organizing customer information without having to invest in new hardware and software.
- After having mostly covered their needs in the backoffice space, the main IT demands from the Latin American mining sector are now concentrated on the operational field in an attempt to curb lost opportunities in the operational area, according to heavy industry enterprise software provider Mincom. Today, mining firms need solutions that provide transparency regarding where the losses are in the whole production chain.
The mining industry contribution to Mincom's Latin American operations is over 80%, while globally it is around 45%.
Chile
- Software and IT services industry association Gechs signed the contract with construction firm Stitchkin for the building of the first IT hub in capital Santiago, which is to be called Polo de Innovación Tecnológica de Santiago (PITS) - a green building that will have eight floors and 6,000m2.
Gechs still needs to define the construction site to start works on the hub, estimated to cost US$12mn.
- State bank BancoEstado plans to invest US$78mn in 2010, with about half of the figure going to updating technology and improving processes in a move to have a massive, low-cost bank that remains profitable.
After gaining three percentage points in market share but sacrificing profitability last year, the goal in 2010 is to defend the current market share by improving customer service.
- LAN Airlines contracted the local unit of IBM to administer its technological platform for the next five years. Under the contract, which carries a US$15mn pricetag, IBM will provide the administration, operation and control of LAN's central technological platform, including security and the implementation of an innovation center.
Brazil
- French IT company Bull and compatriot developer of handwritten data-capture and document classification technologies A2iA won a contract to deploy a Linux-based check truncation solution for "a large bank" in Brazil.
Under the project, Bull will integrate A2iA's CheckReader into the overall solution. A2iA CheckReader offers all the necessary features for Brazil's check truncation regulations, including image quality, analysis, image validity and usability analysis as well as recognition of all compulsory fields.
- Software reseller Brasoftware generated revenues of 215mn reais (US$122mn) in 2009, up 19%, and plans to grow another 14% this year. Sales to the government segment will be a significant contributor in terms of overall revenues this year.
Argentina
- Domestic e-commerce is expected to expand 25-30% this year compared to the 5.24bn pesos (US$1.38bn) moved last year, according to consultancy Prince & Cooke. B2C sales account for approximately 5% of total sales in the country while the C2C segment accounts for the remainder.
E-commerce is set to continue expanding due to the increasing number of internet users as well as increasing penetration of e-commerce services within large and medium sized businesses.
- The overall PC market in Argentina is expected to grow 11% this year compared to 2.20mn units sold in 2009, said Trends Consulting. PC sales last year decreased 2.4% as the overall market suffered the impact of the economic crisis. Desktop sales were down 15.5% on the year while the laptop segment grew 31.1%.
RESULTS & FIGURES
US IT products wholesaler Bell Microproducts' sales in Latin America grew 19% year-on-year in 4Q09. Globally, the company expects revenues for the quarter to reach approximately US$830mn-840mn, increasing 8-10%.
Tech spending in Latin America is expected to expand 7.7% this year, said Forrester Research. Global IT spending, which dropped 8.9% in 2009, is expected to rise 8.1% in 2010 to more than US$1.6tn.
By Christian Molinari
Related Companies
* Asociación Chilena de Empresas de Tecnología de Información A.G. - http://www.bnamericas.com/factfile_detail.jsp?idioma=I&documento=10997§or=0
* Oracle Corporation - http://www.bnamericas.com/factfile_detail.jsp?idioma=I&documento=12391§or=0
* Brasoftware Informática Ltda. - http://www.bnamericas.com/factfile_detail.jsp?idioma=I&documento=12818§or=0
* Prince, Cooke y Asociados S.A. - http://www.bnamericas.com/factfile_detail.jsp?idioma=I&documento=13161§or=0
* Bell Microproducts Inc. - http://www.bnamericas.com/factfile_detail.jsp?idioma=I&documento=21225§or=0
* IBM de Chile S.A. - http://www.bnamericas.com/factfile_detail.jsp?idioma=I&documento=792321§or=0
* Mincom Limited - http://www.bnamericas.com/factfile_detail.jsp?idioma=I&documento=811470§or=0
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** Q & A **
* Software exports to continue expanding despite crisis
Alvaro Lamé
President
Cámara Uruguaya de Tecnologías de la Información (Cuti)
Uruguay
Not letting the fact that it is a small market get in the way, Uruguay (population 3.3mn) is continually looking to increase software and IT services exports. The country is currently exporting these products to over 50 countries worldwide.
Services count for about 60% of Uruguay's GDP, but the government has also been able to diversify these services, establishing the country as a tech hub, for example. The tech industry alone accounts for a reported 7.9% of GDP.
However, sector companies still face various obstacles such as the lack of sufficient human resources and access to financing.
To find out more about these issues, BNamericas talked with Alvaro Lamé, president of Uruguayan IT chamber Cuti.
BNamericas: What is the outlook for Uruguay's software and IT services market for 2010?
Lamé: We continue to work under our strategic plan. We're always updating this plan, but its main objectives are the same. One of the key points of this plan is to continue boosting software and IT services exports. Our sector is performing well in terms of software and IT services exports. In 2008, the country exported US$250mn.
Another key issue for us is human resources in the IT sector. The sector does not have unemployment, but the lack of sufficient human resources for the sector is a concern for us since this issue is putting a limit on sector growth. We've developed a specific platform to train people through distance education courses and we're having the first graduates of these specific courses.
Another important issue to take into account is that we'll have a new government in March. It's true that the ruling party remains in office, but many officials will change and they could have different ideas. One of the main duties of the chamber will be to show the new government the importance of the sector for the national economy. We want to find mechanisms to contribute to the development of our sector.
BNamericas: How much software and IT services did the country export last year?
Lamé: We're in the process of determining that figure. What we can say is that sector's exports have been growing at significant rates over the last six years.
Last year, the economy suffered the effects of the global economic crisis but as far as we know, most of the IT companies in Uruguay did not feel the impact of the crisis. This is why we believe that exports in 2009 could have expanded approximately 20% compared to the previous year.
BNamericas: And what about software and IT services revenues in the domestic market?
Lamé: We do not officially measure the local market in terms of revenues. However, the sector's overall revenues have been growing over the last years as well. What I can tell you is that exports currently account for approximately half of the sector's overall revenues.
BNamericas: What are the main markets for Uruguay's software and IT services exports?
Lamé: Latin American markets continue to be the main destinations for our exports. Some of the main markets for Uruguay are Mexico, as well as the US. However, we're currently exporting to approximately 55 countries. We export to China and some European countries, but volumes are not high compared to other markets.
BNamericas: What concrete steps is Cuti taking to promote software exports?
Lamé: We're working to promote software exports through trade missions. We're also promoting associations to help smaller companies to start exporting to foreign markets, while also looking for financing for these projects.
Also, we're studying the possibility of opening offices to promote our exports abroad. However, we're still limited in terms of financing to achieve this.
BNamericas: What are the main advantages of the country in terms of software production? Is Uruguay trying to focus on determined sectors?
Lamé: One of the main specializations is the financial sector. There are several large companies with a focus on this sector.
Another important focus is development platforms, with Artech as one of the main companies with its GeneXus solution. Some companies also specialize in software solutions for mobile telephony.
What we're doing is helping small companies to start exporting. We offer all the necessary information regarding exporting procedures and we also give these companies details of market conditions of determined countries. Larger companies do not need help. They're the engines of the sector and are already set up in terms of exports.
BNamericas: You mentioned a platform for distance learning. How many people have you trained with this tool?
Lamé: We've trained approximately 400 people during the first year of the project. We train people in different programming languages such as .Net and Java, which is what the sector is demanding.
We think that it's a very important number for us. We're focusing on training people in the provinces. These courses last approximately six months.
BNamericas: Are local companies in the sector having troubles in accessing financing?
Lamé: Yes, the companies still have difficulties in accessing financing, but this issue is related to the fact that Uruguay is a very small market. The chamber has been working with the state bank as well as with private banks to make this process easier for companies, but we still have problems with this.
Software and IT services are intangible assets and we can't put factories or other goods as collateral when we're asking for a loan.
BNamericas: Is the government offering special incentives for software companies?
Lamé: Software exports are benefited with tax exemptions. This regime was established by a law implemented three or four years ago. However, our exports are charged with taxes outside the country.
BNamericas: Is the government a main buyer of local software?
Lamé: No. In general terms, the government is not an important buyer of software and IT services. The government has created an agency to boost e-government and innovative projects. However, large state-owned companies such as Antel or Ancap put conditions which are very difficult to fulfill for local companies.
About Alvaro Lamé
Besides serving as president of Cuti, Alvaro Lamé is also director of Uruguayan telecoms company Netgate.
About the organization :
Cámara Uruguaya de Tecnologías de la Información (Cuti) is an association of communication and information technology companies whose principal objective is to promote and actively support development of the IT industry.
By Juan Pedro Tomás
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** COMING UP **
January 15-16, 2010:Delta Asesores seminar: ICT strategic planning, in Quito.
Ecuador
January 17, 2010:Second round of presidential election.
Chile
January 18, 2010:Martin Luther King, Jr. Day, US markets closed.
Regional
January 19, 2010:Technical and economic proposals due to the municipality of Vitacura, located in capital Santiago, in its procurement tender for the implementation of an e-signature platform to be used with several electronic documents generated by the municipality, including vehicle permits, municipal permits, traffic fines, public works certificates and others.
Chile
January 27, 2010:New president Porfirio Lobo to be sworn in.
Honduras
January 27, 2010:Software development association Softsul will hold an event on growth strategies for IT firms, on this date in Porto Alegre.
Brazil
January 31, 2010:End of due dilligence process for Brazilian IT company Politec's proposed purchase of Chilean tech holding company Quintec.
Brazil, Chile
February 07, 2010:Presidential and congressional elections.
Costa Rica
February 15, 2010:Washington's Birthday/Presidents' Day, US markets closed.
Regional
February 16-17, 2010:Delta Asesores seminar: ICT strategic planning, in Cali.
Colombia
February 23-24, 2010:Delta Asesores seminar: Getting the most out of ICT, in San José.
Costa Rica
March 01, 2010:Delta Asesores seminar: Getting the most out of ICT, in Santa Cruz.
Bolivia
March 04-05, 2010:Delta Asesores seminar: ICT strategic planning, in Santa Cruz.
Bolivia
March 15, 2010:Projects can be presented up until this date to the country's science and technology ministry, to obtain part of the 21.6mn pesos (US$5.7mn) in financing for innovative production projects. The financing is for up to 70% of the total cost of the project.
Argentina
March 17-18, 2010:Delta Asesores seminar: Getting the most out of ICT, in Bogotá.
Colombia
April 02, 2010:Good Friday, most markets closed.
Regional
April 06-07, 2010:Delta Asesores seminar: Getting the most out of ICT, in Santiago.
Chile
May 31, 2010:Memorial Day, US markets closed.
Regional
June 23-24, 2010:The tenth annual e-Learning Brasil conference will be held on these dates at the Renaissance São Paulo hotel. This year's theme is "Beyond e-Learning: Developing talent."
Brazil
July 05, 2010:US holiday marking Independence Day.
Regional
September06, 2010:Labor Day, US markets closed.
Regional
October 03, 2010:Presidential elections.
Brazil
November 01, 2010:All Saints Day, most Latin American markets closed.
Regional
November 25, 2010:Thanksgiving Day, US markets closed.
Regional
December 24, 2010:Christmas holiday (observed), US markets closed.
Regional
April 30, 2013:Project implementation deadline for a US$25mn World Bank-sponsored project to ramp up the nation's public information systems.
Colombia
Click here to view the most important conferences and events in your sector of interest. http://www.bnamericas.com/conferences_home.jsp?idioma=I§or=1
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* La innovación en los servicios: aspectos generales y los casos de los servicios de telecomunicaciones, turismo y bancario - http://www.bnamericas.com/research_detalle.jsp?idioma=E&documento=1005382§or=0
* Vacíos y discrepancias estadísticas en los indicadores ODM: Hacia una estrategia regional de conciliación estadística para América Latina y el Caribe (versión preliminar) - http://www.bnamericas.com/research_detalle.jsp?idioma=E&documento=1007009§or=0
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* Diagnóstico y propuestas para el mejoramiento de los procesos de logística y aduana en la región de Centroamérica y Panamá - http://www.bnamericas.com/research_detalle.jsp?idioma=E&documento=1007007§or=0
* Agenda estratégica publico-privada de cooperación regional para la facilitación del comercio y la inserción internacional: El Salvador y Guatemala - http://www.bnamericas.com/research_detalle.jsp?idioma=E&documento=1007005§or=0
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