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| Gartner Dataquest Says Telecom Vendors Must Continue to Invest in Argentina Despite the Country's Economic Difficulties |
| New Report Examines the Impact of Argentina's Woes on Latin American Telecom Market |
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STAMFORD, Conn., December 11, 2001 - The economy in Argentina is in a major recession and on the brink of default, but despite these economic conditions, telecom companies need to continue to invest in the country, according to Dataquest Inc., a unit of Gartner, Inc. (NYSE: IT and ITB).
Argentina has a sagging economy, and it has not been able to shed itself of excessive debt, tallying upwards of $132 billion. In November, the country was not able to pay its growing interest bill, and government officials had to ask lenders at home and abroad to assume huge write-offs on as much as $60 billion in bonds. Gartner Dataquest analysts acknowledge there will be serious challenges ahead, but it's important that telecom vendors don't abandon their plans for the country. "Telecom investment should be maintained at least at the level of 1999. While some market players are talking about cutting investment in half, this would be a serious mistake for those market players who are looking to continue operations in Argentina and the rest of Latin America," said Marta Kindya, senior analyst for Gartner Dataquest's telecommunications and networking worldwide group. "The rollout of new products and services will continue to mildly stimulate the Argentine markets and contribute some profitability," Kindya said. "To cutback investment in Argentina would be extremely shortsighted for those carriers wishing to operate in the Latin American telecom marketplace." Despite the current economy, Gartner Dataquest analysts point out that, in terms of the telecom marketplace, the economic condition in Argentina will not be as bad as the Asian crisis of 1997-1998. "During the Asian crisis, falling world export prices and volumes threw some Latin American countries into recession. Call it an effect of globalization, but this affected the Latin American telecom markets extensively. Since that time, there has been a wave of privatizations and liberalizations in the region that have transformed the telecom markets into more robust sectors, less subject to international influences," said Kindya. Gartner Dataquest analysts expect the telecom market in Argentina to slightly improve in 2002. Telecommunications investment in Argentina will total $246 million in 2002, up from $244 million in 2001. Gartner Dataquest forecasts fixed public network services in Argentina to reach $11.6 billion in 2002, which is a 21.3 percent increase from 2001 revenue of $9.6 billion. Additional information is available in the Gartner Dataquest report "Will Argentina's Economic Woes Affect the Latin American Telecom Markets." In this document, Gartner Dataquest analysts examine the current economic situation in Argentina and provide advice on what telecommunication vendors must do to compete in the country. This research is published by Gartner Dataquest's Telecommunications and Networking group. This group provides analysis for the full spectrum of telecom and networking issues. To keep up to date on the latest telecommunications issues, please visit Gartner's Telecommunications Focus Area at www.gartner.com/1_researchanalysis/focus/telecom_fa.html. To subscribe to Gartner Dataquest programs, please call 408-468-8000. Reports can be purchase on the Internet at www.gartner.com. Gartner Dataquest is the recognized leader in providing the high-technology and financial communities with market intelligence for the semiconductor, computer systems and peripherals, communications, document management, software, and services sectors of the global information technology industry. Gartner, Inc. is a research and advisory firm that helps more than 11,000 clients understand technology and drive business growth. Gartner's divisions consist of Gartner Research, Gartner Consulting, Gartner Measurement and Gartner Events. Founded in 1979, Gartner, Inc. is headquartered in Stamford, Connecticut, and consists of 4,300 associates, including 1,200 research analysts and consultants in more than 90 locations worldwide. The company achieved fiscal 2001 revenue of $952 million. For more information, visit www.gartner.com. |
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Contact: Tom McCall 408-468-8312 tom.mccall@gartner.com |
