Latin American Enterprises, Carriers Boost Network Spending

Networking vendors see growing opportunity in Latin America.

September 13, 2004

2 Min Read
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Recovering from many of the same economic forces that derailed IT and telecom spending in the U.S., enterprises and service providers in Latin America are starting to increase their technology spending, reports from the region show.

Brazil, the largest economy in the region, will witness increased spending, according to a new study from the Yankee Group. A survey of small- and medium-sized businesses by the firm found the group projecting a 10-30 percent increase in IT and telecom spending next year.

Juniper Networks seems to believe the Latin American region presents growth potential, as it just created two new high-level sales positions for the region. Raiding Cisco's management talent, the company named Bob Bruce, vice president of America's Channels and Neal Oristano, vice president of America's Sales. Kothari had been vice president/general manager of Cisco's Linksys division; Bruce was vice president of U.S. channels at Cisco.

Lucent this week found evidence that the market in Latin America offers promise, as it announced milestones and contracts with Mexico's Maxom and Argentinian carrier Telefonica.

For Telefonica de Argentina, Lucent reported completion of the installation of 80,000 new ADSL access ports in the carrier's network. More than three-quarters of the ports use DSLAM IP technology. The new ports are enabling Telefonica to address broadband demand in the home and business markets. Lucent will be helping Maxcom to expand the carrier's network and build in access and platforms for IP services. Lucent also will supply next-generation switch software which will support the carrier's plans to offer new IP services such as VoIP and VPNs.A survey by Cisco found that that 83 percent of Latin American business executives believe the Internet and Web technologies have helped improve the productivity of their companies, and accordingly are projecting that they will make significant IT investments over the next year.

Cisco executives are optimistic about the region based on what business executives there have said about the current level of under-investment in technology that has characterized Latin America. The region's technology investments have been averaging about 1.7 percent of the region's gross domestic product, trailing the United States (5.2 percent), Europe (3.5 percent), and Asia (2.4 percent).

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