 | Issue: | Latin America II 2000 |
| Article no.: | 11 | |
| Topic: | Telecom Argentina’s Role in the Development of E-Business | |
| Author: | Juan Carlos Masjoan | |
| Title: | Chairman & C.E.O | |
| Organisation: | Telecom | |
| PDF size: | 20KB |
About author
Not available
Article abstract
E-Commerce has only taken off in Argentina with the advent of the new millennium. Until last year, less than half of the big companies had their own web site and only 15% of them were planning to introduce e-Commerce applications. The reasons why these corporations were not identifying the benefits were the lack of demand, high implementation costs and a comfortable feeling about the existing business strategy.
Full Article
Although the future of B2C and B2B commerce looked promising, its significance did not seem that imminent. Seminars and events related to electronic commerce are booming this year. New e-Commerce web sites are advertised everyday in newspapers, magazines, on radio, television and on the streets together with e-Business success stories. In terms of Internet infrastructure per capita, Argentina ranks third in Latin America after Brazil and Mexico. The Argentine market is now tackling e-Commerce structure barriers such as a thin critical mass of users, high rates and the lack of local content and additional services such as those providing means of payment and delivery. Market conditions and online sales opportunities will soon be a reality, just around the corner in the short term. The necessary critical mass is expected to be reached next year. The country has over 2,500 large companies and practically all have access to the Web. Direct international connections and quality service are the most important aspects to be considered when selecting an ISP. Many big companies are still connected to the service through the telephone switch network. Although 75% of these companies have a web site only 30% already deal in e-Commerce and, only 5% of the companies participate in B2B e-Commerce. The major transactions are related to dealers, orders to suppliers and sales to habitual customers. Generally, traditional means of payment, such as checking account debits, are used. On the other hand, there area approximately 200,000 SMEs and half of them have access to the Web, largely through switched services. Financial institutions are actively working on the implementation of safe means of payment for the Internet in combination with trust services provided by national and international companies. Internet users in Argentina The penetration of the Internet in Argentina is 3%; in other words, Argentina’s current 1.2 million Internet users are expected to grow to 3 million by 2002. Ninety nine percent of Web access in Argentina is conducted through 0-610 numbers. This is a reduced rate switched telephone offered for calls to Internet Service Providers. Usage of this service is expected to plunge to between 80 and 85% by 2004 due to the introduction of modem cable and ADSL services. Web users in Argentina tend to be well-trained in Internet resources and, generally, they speak English well. E-Mail is the most used application followed by the Web and Chat programmes. Most users surf the Web looking for market information, news and travel planning. Twenty percent of them shop on the Internet. This has contributed to the use of catalogue shopping, which until recently has not been popular in our country. The main reasons given by Argentineans for not buying on the Internet are their lack of trust in the means for handling payments and their perception that the service offered is substandard. Telecom Argentina is one of Argentina’s leading corporations. It has been operating since November 1990 when its state-owned predecessor was privatised. Telecom has invested 8,159 million dollars up to date, promoting an historical advance in Argentine telecommunications by introducing brand new services and a 100% digital network. Its affiliated companies provide basic domestic, national and international long distance telephone services. Telecom Argentina provides mobile telephony, including PCS, in Argentina and Paraguay, access to the Web, data transmission, value added services and publishes telephone directories. The Internet and e-Commerce provide a satisfactory virtual environment to replace or round-up traditional corporate activities and develop new business models. This scenario offers opportunities to establish competitive advantages, expand access to markets and cut down costs by facilitating integration with regional and international markets. Companies need to establish a suitable strategy in answer to the threats of this virtual environment and take advantage of its opportunities. Telecom in its role as a technology partner of customers, providing its e-Company family of products, plans on taking the lead in supporting these efforts. The e-Company family of products was created to meet the demand of different business models based on Internet, Intranet and Extranet with the necessary versatility to rapidly solve diverse degrees of complexity and innovation. The essential objective in developing the technology infrastructure, the networks and systems, was to resolve the basic needs of an e-Commerce platform: reliability, prospective expansion (scalability), security and performance. Based on this structure, Telecom has created basic functional platforms that both types of e-Business, B2B and B2C, can use to run customer-tailored applications. Conclusion Additional components assist the business solution. These provide full operational support for the market system, in other words, the interconnection and integration with the systems of the customer’s and suppliers in the value chain. Telecom Argentina’s payment gateway is important and particularly interesting for the B2C operations. It handles online credit card payments in a high-security environment and it has been planned, and is ready, for the future introduction of other electronic means of payment. Telecom offers a full range of services to all the players in this value chain through partnership agreements with different, proven and competent, companies that have arisen from its SCP programme (Strategic Cooperation Programme), a programme created by Telecom to promote e-Business opportunities and increase business versatility and scope. Finally, Telecom’s infrastructure – its networks, systems, products, services, partnership programmes, commercial and marketing strategies – facilitates and supports value creation and customer growth in the new virtual market-place.
