MBAT6150/INSF 6150 SPRING 2001 FINAL SESSIONS Class 25. April 17 - Tuesday Prepare: Patagon

1. MBAT6150/INSF 6150 • SPRING 2001 • FINAL SESSIONS • Class 25. April 17 - Tuesday • Prepare: Patagon.com • Guest Speaker: Azul Casares • Class 26. April 19 - Thursday • Guest Speaker: Dede Willis, CIO Proligo LLC • Classes 27-29. April 24 and 26 and May 1 • Group presentations • Class 30. May 3 - Thursday • Final Review. Final Project is due.

2. TODAY’S CLASS Discussion: EC in other parts of the world. “The StorageTek e-Business” Marissa Head Project Manager (Website Mexico, Brazil & China) Barry Bradford Global Program Manager, E-Business

3. “More than 75% of all EC takes place in U.S. Europe generates more than 20% The rest accounts for less than 5%.” Inter-American Development Bank, July 1999

6. Distribution of Language

7. Internet Market Potentialin Latin America 1999 2005 (Est). % of citizens on the Net (1) 2% 12% Online users (1) 11 million 67 million % that are online shoppers (1) 13% 34% … but: E-commerce market(1) $537 million $8.3 billion Online advertising (2) $51 million $1.6 billion Internet services (3) $1.4 billion $8.1 billion Sources: (1) Jupiter Communications, (2) Forrester Research, (3) International Data Corporation

8. Internet Market Potentialin Latin America Expected Internet Growth 2000-2005 52% Latin America Asia-Pacific Western Europe North America 34% 24% 19% 0% 20% 40% 60% Percentage of yearly growth Source: Jupiter Communications

9. Internet Market Potentialin Latin America Increase in IT investment Reduction in telecommunication costs 90% of users come from the upper-middle class strata of society 90% of users between 16 and 45 years old 60% of the users have a high school diploma On average a Latin American user spend 8 hours/week online Source: Nazca Study 1999.

10. The potential for [the Latin American] market is mind-boggling. It is a market that knows brand names and wants to buy brand names…. For better or worse, only a small percentage of the population there can afford multiple phone lines and computers. This is a market that finds it cheaper to buy online than to fly to Miami or New York to buy. Betsy Scolnik Vice President of Business Development StarMedia

11. Latin American B2B Projections Source: Busines 2.0, October 18, 2000

12. Barriers to E-Commerce • Low PC penetration • High access cost • Low credit card usage • Inadequate fulfillment systems • Not enough locally relevant content or services

13. Preferred Destination of U.S. Multinational among Developing Nations in the 1990s COUNTRY $ Billion % of Total 1. Brazil $33.7 13.0% 2. Mexico $32.2 12.4% 3. Singapore $18.3 7.0% 4. Hong Kong $16.3 6.3% 5. Panama $10.7 4.1% 6. Argentina $10.3 4.0% Source: U.S. Bureau of Economic Analysis

14. Key Drivers to Grow ECin Latin America - Innovators have had access to knowledge, technology, and resources - Every country in Latin America has now access to the Internet - Major investments in telecommunication infrastructure - As the Internet technologies have been assimilated, this medium have come to be recognized as an important competitive market

15. Key Barriers to Grow ECin Latin America - Near passive-receiver role of most countries - Variations reflect each country’s available technology, existing infrastructure, and perceived importance - Efforts to gain access to the Internet, but not to understand how to use it for competitive advantage - Presence still driven mainly by fashion - Lack of adequate network linking them to each other and to users who could benefit from their experience

16. Interesting Web Sites on the Topic Global technology, media, and telecom: http://www.morganstanley.com/techresearch/tmtreport/index.html The Internet in Europe: http://www.morganstanley.com/techresearch/euroinet/info.html The Internet in Japan: http://www.morganstanley.com/techresearch/japnet/info.html Scientific Networks in Latin American and the Caribbean: http://www.unesco.org.uy/redeste.html Institute of Latin American Studies (UT Austin) http://lanic.utexas.edu