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True value: as Latin America goes from paper to bits, tech companies win.

Latin America is known for leap-flogging. Households often jump to using high-tech cell phones from old rotary phones, sidestepping years of technology evolution in a single afternoon.

What's true for the private sector is true for the government, too. The Latin American information technology market, now a US$145 billion business, will grow, making the region one of the world's biggest growth areas, according to technology research firm Gartner. "Latin American governments' use of technology is synonymous with modernizing its internal functions and improving services and becoming more transparent for its citizens," says Donald Feinberg, director for Latin America at Gartner. "It's one of the most rapidly growing regions, trailing only Western Europe."

There are few public budgets in Latin America that don't have loads of money set aside for information technology, although finding where that money can be tough. "It's difficult to get a global figure on how much is spent. It's not easy to see where it would lie in a given budget," says Ricardo Pedroza, head of the U.S. database provider Oracle in Colombia. Nevertheless, the information technology market in Latin America is growing, at around 6% a year, Pedroza says.

Venezuela, for instance, is going through a revolution, says Carlos Joa, head of the information technology at the country's Ministry of Education. He's not talking about his firebrand President Hugo Chavez' social policies. He's talking about using Linux, an open-source operating system, on the ministry's computers.

"With open source we've saved $2 million over the last year," Joa says. And those savings will be put to good use. For 2007, the ministry plans to spend $400 million updating technology and putting new computers in the country's public schools.

A survey conducted by research firm IDC shows that 64% of government agencies in Brazil, Mexico, Argentina, Peru, Chile, Colombia and Venezuela plan to increase tech spending. Purchases of new equipment, such as computers and printers, are fueling that growth, says Emerson Gibin, an IDC analyst. "Sixty percent of the departments consulted said they would buy software or new computers," says Gibin. "We are seeing more digital projects on government agendas." Latin American governments are also concerned with information security, particularly when it comes to databases. "The outlook for information technology expenditures in 2006 and in 2007 is very positive. We expect growth of 7% from governments," Gibin says.

Big tech companies like Microsoft, Lenovo and Intel have joined forces with various governments across Latin America to kick off programs that bring computers to low-income families in Argentina, Chile, Peru, Brazil, Uruguay, Ecuador and Colombia.

In Venezuela, the National Electoral Council plans to spend $80.9 million expanding its electronic voting system. The government has already budgeted $115 million to upgrade computer systems at the interior and justice ministries. The Chavez administration also will spend $12.9 million moving government programs to open-source software this year and another $50.3 million in 2007.

The Brazilian government, one of the biggest spenders in the region when it comes to technology, will invest more than $2.18 billion in 2006 in technology, 14% more than last year. Things should keep growing in 2007, says Luciano Crippa, an IDC analyst who follows the region's largest country. The government is the third-largest technology investor in Brazil, trailing banks and industry, Crippa says. "The government is looking for tools that will allow it to interact with the population," he says, "to consolidate its gigantic databases and improve work at analyzing the needs of the people."


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Title Annotation:COMPUTERS
Author:Crowe, Darcy A.
Publication:Latin Trade
Date:Aug 1, 2006
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