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Chile's 1997 investment in information technology is calculated at US$1.2 billion. The total IT market for 1998 is estimated at US$2 billion. Of this amount, 55 percent corresponds to hardware.
Chile is recognized as having the most advanced wire and cable infrastructure in Latin America. It has the best telecommunications network and therefore the best Internet and computer network in the region. Chile has expertise in mining, pension funds, private health insurance and other areas, and is melding this into a regional software domain. Latin America is the obvious market for Chilean software products. Besides having a common language and traditions, Latin American countries are expected to experience substantial economic growth in coming years. Chilean software producers already have operations in Mexico City, Caracas, Buenos Aires and Lima.
Price Waterhouse estimates that personal computer (PC) business software industry/market in Latin America will expand by 25 percent per year. The industrial sector is keen on modernizing its operations, especially in managing human resources, stock and automation. Retail and commerce are also proliferating, especially in the field of supermarkets, in need software to solve the problems of stock, management process, information exchange and workflow. Bar codes have been in operation in Chile for a couple of years with good results, but new technological software is needed to accommodate the rapid growth of hypermarkets, supermarkets and other retail systems.
Telecommunications are growing quickly and will need new and sophisticated software products to be able to compete with the several telecommunications enterprises currently in operation. Consulting firms are also growing rapidly and will benefit from remote linking and messaging, enabling quick answers to their customers.
Another up-and-coming field is research and development. In this sector there are several interested parties. These entities will need technological software to conduct research with success.
Table 1 shows the total IT and internal packaged software markets during the last few years. About 70% of this is imported, mainly from the US.
Table 1: Chilean IT and packaged software market (US$ millions).
Personal computers sold in Chile (thousands)
|
Year |
IT |
Growth |
Software |
Growth |
Software |
Growth |
PC |
Growth |
|---|---|---|---|---|---|---|---|---|
|
Market |
(%) |
Market |
(%) |
Exports |
(%) |
Units |
(%) |
|
|
1989 |
na |
-- |
na |
-- |
1.4 |
-- |
30 |
-- |
|
1990 |
na |
-- |
na |
-- |
3.6 |
157 |
40 |
33 |
|
1991 |
na |
-- |
na |
-- |
6.4 |
88 |
60 |
50 |
|
1992 |
439 |
-- |
52 |
-- |
13.9 |
117 |
83 |
38 |
|
1993 |
496 |
13 |
70 |
35 |
22.0 |
58 |
110 |
33 |
|
1994 |
555 |
12 |
77 |
10 |
na |
-- |
120 |
9 |
The software industry has benefitted from dynamic growth in telecommunications, and local telecommunications companies have become the most developed companies of their kinds in the region. All important cities are wired with fiber optics, all the telephonic switching in the country is digital, ISDN was introduced in 1994, and almost all universities and many companies are connected to the Internet. In the last ten years the number of telephone lines has more than tripled to 1.6 million. Internet traffic into and out of NSFNET from Chile during February-March 1995 was 15.2 Gbytes, compared with 27.4 Gbytes for Brazil, with more than 10 times Chile's population
Another important development was the multicarrier system for long distance calls introduced in 1994. Eight competing companies are offering this service, resulting in major rate reductions.
IT projects have experienced growth pains in Chile. Some projects have been too ambitious or have been poorly done.
WEB and AccessNova Project
Fulfilling this historic opportunity is the main purpose of the new Science and Technology Information Center (ICT) at UChile, one of the most ambitious projects generated in the country. Indeed, ICT is the most comprehensive and serious response of the university to the challenges posed by global technological progress.
In this context, UChile established a cooperative research agreement with the Nippon Telegraph and Telephone Corporation (NTT). Under the terms of the AccessNova Project, NTT will support UChile in formulating a strategy for the early introduction and development of B-ISDN (Broadband Integrated Services Digital Network) in Chile, by proposing a plan to jointly carry out testing and experiments on high speed network and broadband applications. The project, which will be implemented through ICT, was aimed at completing a next generation telecommunications network and services in Chile during the period 1995-99, by installing super high speed and large capacity experimental transmission lines (2.4 Gigabit/sec) in its ATM backbone network.
At present, a group of 18 researchers (9 in each country) is actively collaborating to establish the AccessNova Tokyo-Santiago Virtual Laboratory for the implementation of the project.