Business Development in Latam Telco market


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Snark Consulting provides business development services in order to start operation in Latin America.

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Business Development in Latam Telco market

  1. 1. Business development in LatAm Telco market May 2010 Daniel Collico Savio Director [email_address]
  2. 2. Lat Am telco context: three sides of the story <ul><li>About 30 prospect Telcos comprising 90% of customers </li></ul><ul><li>Two dominant groups: Telefonica /Movistar and Telmex / Claro. </li></ul><ul><li>Strong competition around big cities: </li></ul><ul><ul><li>Mexico DF, Sao Paulo, RJ, Buenos Aires, Santiago, etc. </li></ul></ul>Telcos Regulators Customers <ul><li>No broadband regulation in most of the countries </li></ul><ul><ul><li>Exception: ANATEL, Brazil </li></ul></ul><ul><li>Lacking of knowledge. </li></ul><ul><li>Most concerned about old PSTN issues </li></ul><ul><li>Demanding higher speeds and better user experience </li></ul><ul><li>Complains about P2P restrictions </li></ul><ul><li>Broadband lines </li></ul><ul><ul><li>40M fixed </li></ul></ul><ul><ul><li>~9M mobile </li></ul></ul>
  3. 3. LatAm Basic figures <ul><li>Fixed broadband customers: 35M </li></ul><ul><li>Top Penetration countries: Chile (11%), Argentina (10,5%), Brasil (7.5%), México (6.0%). </li></ul><ul><li>Average speed </li></ul><ul><ul><li>Chile, Arg, Brasil, Colombia, México ~1,5 Mbps </li></ul></ul><ul><ul><li>Rest of LatAm < 1 Mbps </li></ul></ul><ul><li>………………………………………………………………………… . </li></ul><ul><li>Mobile customers: 520M </li></ul><ul><li>91% GSM-HSPA technology. </li></ul><ul><li>Still low penetration of wireless broadband ( ~ 4%) </li></ul>Source: FayerWayer, Datos Claros, 3GAmericas. and CNN (April 2010)
  4. 4. A tale of two big Telcos <ul><li>Telefonica Group (including brands Vivo and Movistar) </li></ul><ul><li>Telmex / Telcel ( América Móvil / Claro (Carlos Slim group, different branding per country). </li></ul><ul><li>Very distant competition from Millicom, Telecom Italia, C&W, etc. </li></ul>Investment in mobile operators in CALA region in 2008 (Source ITU)
  5. 5. Business main drivers <ul><li>Speed / QoS improving vs Diminishing Capex </li></ul><ul><ul><li>Concern: average speed in the region is below 1Mbps. </li></ul></ul><ul><li>Web 2.0 integration with Telco´s services </li></ul><ul><ul><li>Speedy 2.0 (Telefonica) </li></ul></ul><ul><ul><li>Myriad platform (Movistar) </li></ul></ul><ul><ul><li>Redes Sociales Ideas (Telcel) </li></ul></ul><ul><ul><li>Oi Paggo (Brazil) </li></ul></ul><ul><li>“ The Cloud” effect </li></ul><ul><ul><li>Oportunity or threat? </li></ul></ul><ul><ul><li>Customers: “Don´t want your webmail, Napster or Google-like map. Gimme speed, handsets and clear billing instead” </li></ul></ul><ul><li>Go wireless. </li></ul>
  6. 6. Business case: Brazil <ul><li>Divided in regions for fixed. TeleSP is huge in Sao Paulo. </li></ul><ul><li>Four competitors for a very balanced mobile market. </li></ul><ul><li>Telmex not there, but Claro and TIM are attacking Vivo. </li></ul><ul><li>Highlights: </li></ul><ul><li>Division Sao Paulo / Total for all stats. </li></ul><ul><li>176M mobile customers, about 90% of them are prepaid. </li></ul><ul><li>TV Cable and ip technologies. </li></ul>Sao Paulo Total 1 1 2 2 3 3 Fixed Mobile TV Source: Snark Consulting, and media (April 2010)
  7. 7. Summary <ul><li>Two big accounts, Telefonica and Telmex-Claro. </li></ul><ul><li>Go for the 80% of the market / don´t waste time in Central America or minor countries in South America. </li></ul><ul><li>Some tips for business development </li></ul><ul><ul><li>Respect strong management and central coordination </li></ul></ul><ul><ul><li>Send compatible messages to Telcos HQ in EC and US </li></ul></ul><ul><ul><li>Look after “try & buy” and “managed services” concepts. </li></ul></ul><ul><ul><li>Expect some delays in negotiations </li></ul></ul><ul><ul><li>Forget about meetings during football World Cup. </li></ul></ul><ul><ul><li>Spanish language is mandatory </li></ul></ul><ul><li>Play fair </li></ul><ul><ul><li>Avoid “cheap revenue share” local pushers. </li></ul></ul><ul><ul><li>Telco means long-term business. </li></ul></ul>
  8. 8. <ul><li>Business development from the ground up for foreign Telco providers and vendors. </li></ul><ul><li>Access to a network of contacts within all LatAm operators. </li></ul><ul><li>Sizing the business </li></ul><ul><ul><li>Estimation of required resources and time involved </li></ul></ul><ul><ul><li>Development of business plans </li></ul></ul><ul><ul><li>Roadmaps, and weekly reporting. </li></ul></ul><ul><ul><li>Webex sessions & demos </li></ul></ul><ul><ul><li>Meetings with customers. </li></ul></ul><ul><li>Contact </li></ul><ul><ul><li>http:// </li></ul></ul>Snark Consulting biz dev means…