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February 26, 2007
The Telecom Market in Mexico Q and A
1. Growth expectations in the short term for the Internet Protocol in Mexico?
Mexico’s Internet is expanding. With more than 200,000 websites using the .com.mx domain and with over half of the federal and state agencies running websites to service Mexicans we can point to a growing virtual economy.
Over two thirds of the people using the Internet are doing so via cafes and other shared resources. This makes it hard to benefit from always being on the Internet.
This pent up demand that has given birth to these websites and portals indicate the market is ready to explode if the economics of use were changed.
2. When is WiMax going to become a reality in our country?
Its coming slowly to the US as well. Lots of promises but the real question is, what will you being using with it? With cellular today we use cell-phones. With WiFi we use laptops. What does WiMAX mean to how a person accesses the network? Will the price point change the consumers’ device?
3. What is the future for IP Communications worldwide? Innovations, advances, new solutions?
Right now in Europe the major trend is in wireless call arbitrage. Companies such as JaJa, Rebtel and Truphone are all focused on reducing the rates for wireless settlement. In the US the trends are toward “tossable” digits (where phone numbers are used for a specific purpose and then thrown away) and also contextual calling where people are reaching out to their buddies and making profiles that allow advance forms of distinctive ringing and call forwarding.
Asia and Europe have well established triple play strategies that are being deployed, some of which treat phone services as a give away.
4. What kind of infrastructure or technology is necessary to have an optimal IPTV service in our country?
Cable competition is not very significant and its unclear that IPTV is the logical investment when two times more people have wireless phones than fixed line services. It may be that mobile video and services like MediaFlo are the future of IPTV in Mexico
5. Top benefits of VoIP for enterprises?
At this stage of Mexico’s digital development, I would say that the biggest value is internal to the company. Making a common infrastructure that can be managed by the same group is a strong benefit.
However, I am well aware that many use Skype to have cheap International calls and VPNs to make connectivity available beyond their own local boundaries.
6. How easy is for SMB to have that kind of technology?
It can be pretty hard to deploy the technology, but I have seen some bundles of service where four phones and a wireless router are provided that could be significant savings for a company that was looking to use DSL or cable to connect to the Internet.
Given the domain growth, it’s clear that more people are getting email. In the near future that email name could be used to “dial” a call. Maybe Mexico will be a leader in that use of domains.
7. Percentage of cost efficiency for companies using this technology and average time to ROI?
Depends on where their costs are. If they have significant toll cost it can be three months, if they are gaining productivity from VoIP within the enterprise its proably in the 2 year range. But it is legitimate and it will have added value as the Internet expands in Mexico.
8. Main challenges for the IPTV's implementation in Mexico?
Lack of broadband. Licensing issues. Other regulatory woes.
For Voice the lack of broadband makes it so that Skype is one of the few voice services that can be used universally, though I don’t know if people are bringing headsets with microphones to the Internet Café. People should be aware that Google has the same codec.
9. How is the end user's market behavior?
I think the Internet is generating new behaviors for end users. And I think it will continue to do so. Internet Cafes will become less significant as Internet access becomes a municipal service. They wont go away because they have other value socially.
10. Is the mexican market ready, financially and culturally for these new technologies?
No one is ready. But its exciting and makes it interesting to get up in the morning and find out what is new.
11. What's the role of mexican regulations for the successful adoption of these technologies?
The best thing the Mexican government can do is what it is already doing adopt the technologies. As the government embraces the technology more people will benefit by watching, and expecting that the private sector can be reached the same way the government can be contacted.
Additionally the disparities in the economy also making it likely that shared resources are going to be a part of the mix. Promotion of services that are available to everyone like hosted voice mail and virtual numbers should be considered either as a government objective or a desired market for regulators to promote.
12. How was the adoption process in other countries, and what differences would you expect to find in the mexican market?
Mexico has less telecom penetration than many of the early adopters such as Sweden. Mexico is the gateway for all Latin America. It has needs for better services internally and full reach internationally simultaneously. Unfortunately this translates often into more international connectivity than local connectivity.
13. What industries will get more benefits by implementing these technologies?
Many companies have opened call centers using VoIP in Mexico and that has provided jobs in a variety of business sectors. Vertical markets such as financial, healthcare and government services are always good at benefiting from the technology early.
Any company with more than two locations should immediately consider VoIP.
14. What kind of safety measures should be considered in this adoption?
The Internet is a hard place to police. If you run your own mail server you are managing a security policy that you should replicate for your IP phone service. If you are not running your own mail server, its worth considering people who host VoIP as well.
15. Which are the mexican market trends in Telecomm?
Wireless is the trend, WiMAX and VoIP are ripples in the wave in comparison for today. However, they deserve attention because they may be the stronger current in the long run.
16. Are end users ready for these new technologies?
My wife and kids don’t come to me to see what’s cool. They go to the Internet. Technologies are adopted because they have benefit and are easy to use. If you have that the end user is always ready.
Posted by carl at February 26, 2007 04:19 PM