Feature Story

July 17, 2006

Latin America has a wealth of diverse countries, each rooted in their own cultures and traditions. But they have in common a strong desire to develop networking infrastructure that will help them grow their economies. In a Q&A, Carlos Carnevali, Cisco Systems' VP of sales for Latin America, outlines the growth of these economies and the ways Cisco is meeting their networking needs.

Q. What kind of impact can networking technologies have in the transformation of Latin American countries?

These technologies have made it possible to make incredible increases in productivity. There is a direct correlation between productivity in the economy and the quality of life of the population. Cisco is working with several governments in the region in order to aid them in installing the basic infrastructure that will allow them not only to increase productivity, but to become more attractive for foreign direct investment. A basic part of that infrastructure is to make broadband available to all. But that is just the basic requirement. On top of that basic infrastructure important, life-enhancing applications will be built, ranging from distance medicine to e-learning, going through a myriad of other services.

Q. How is Cisco working with the governments in the region?

In one way or another, the governments in the region seek to improve their competitiveness on a global scale, in terms of basic access, education, health and efficiency, with the use of information technologies. According to studies carried out by (Cisco Systems'-sponsored series called) Net Impact, governments can increase productivity up to seven times by deploying and managing business processes through the network. We are working with several governments in the region, helping them in the use of network technologies for the improvement of their efficiency and in increasing citizen satisfaction.

We are working with the countries in the region in the development of their own public sector infrastructures for the deployment of documentation systems, customs systems, tax systems, health systems and educational systems.

Q. What is Cisco doing to promote broadband in the region?

Broadband is the basis for developing key services and applications. For instance, we are promoting the adoption of broadband through the Cisco Broadband Barometer, which we started in Chile four years ago. It is already underway in Brazil and will soon be in Argentina, Peru, Colombia, Costa Rica, Puerto Rico and other countries in the region. The Barometer not only measures broadband penetration, but also sets a challenge for each society to reach a specific objective. For example, in Chile, the goal is to reach 1.5 million broadband connections by 2010, whereas in Brazil, the goal is to reach 10 million broadband connections by the same year.

But in addition to this, we are working with several governments and service providers on the creation of self-sustainable business models, which will allow for growth in broadband penetration, with the aim of reducing the digital gap in those countries.

Q. What is Cisco doing with the Service Providers in the region?

Our Service Provider (SP) clients are interested in eliminating inefficiencies in their networks, increasing their return on investment, reducing their operational costs. Cisco works with all of them in order to achieve these objectives. Service providers are on the route towards the integration of their IP-based networks, an area where Cisco is the recognized leader and where our experience is very valuable. Similarly, we work with many service providers in the development of those services that providers and final users need and require, day after day.

We are focusing on major large SPs (wire line and mobile) present in the region. We are positioning new services capabilities, such as IPTV and the integration of voice, data, video and mobility, bringing those services to the SMB market we are developing, and linking them to our Broadband initiatives in the public sector and other sectors.

Q. Who are some of your largest customers in the region and how are you helping them to transform their business?

Leading service providers are large customers of ours in Latin America, as well as banks, multinational companies, electricity generation and distribution companies. Cisco is working with them to help them transform their businesses and increase their productivity.

Q. Tell me about your go-to-market/channel strategy in the region.

The main factor to have in mind is growth - market growth, due to the rapid expansion of Latin American countries. And to capture this growth, we are broadening our coverage, both from the perspective of the partners, as well as from the point of view of our own organization. Our strategy has four pillars: development of our internal team, greater coverage and training for the channels, channel policies and programs, and accelerators, which are the specific growth and profitability initiatives for our channels, such as SMB financing, vertical development and market. We are working hard toward SMB reseller recruitment and retention, which help us in our business objectives consecution.

All of this is based on Cisco's channel program on a worldwide scale, which is based on value for the end client. What we reward is the partner's investment and commitment, as well as the end user's satisfaction. Our objective is to work with and develop those partners that are committed to Cisco, who invest in Cisco and who achieve the highest customer satisfaction indices.

Q. Latin America is a region full of small and growing companies. What is the Cisco commitment to this segment?

Small and medium-sized companies represent a key growth engine for the economies in Latin American countries. Increasingly, these companies are adopting technology as a way to grow and improve their efficiency and competitiveness. It is often said that the price of technology for small and medium-sized enterprises is too high. However, there are three factors that are often overlooked. First of all, technology is not a luxury but a need for hundreds of thousands of entrepreneurs involved with small- and medium-sized companies. Thus, for them, it is a necessary investment. On the other hand, not all technology is expensive: in fact, the cost per processing unit has been declining continuously over the last few years. Moreover, there are numerous financing programs that are allowing many of these entrepreneurs to access technology, without which they are unable to compete and grow in the next few years.

We are investing a lot in the commercial segment in the region, which, this year, represents more than 45 percent of Cisco's investment in Latin America. Several new initiatives are in place, including SMB channel recruitment and development, enhanced geographical coverage, market intelligence studies to profile companies in the market, and programs to work with companies through our partners and our internal sales organization.