E-Commerce Companies Reach Out to Latin America

BOSTON (05/23/2000) - Spanish Internet giant Terra Network SA's takeover of Lycos Inc. in Waltham, Massachusetts, was an unusual case of an old-line European company buying a U.S. dot-com, but it also marked the growing importance of Spanish-speaking markets on the Web.

In recent months, a host of U.S. electronic businesses have launched Spanish-language sites or merged with companies with existing Spanish-language content to broaden their customer bases, which will be increasingly Spanish-speaking.

A recent report by Jupiter Communications Inc. predicted that the number of Internet users in Latin America (currently around 2% of all Internet users) would grow from 9 million today to 38 million in 2003.

The new international portal venture, Terra Lycos, expects to reach 50 million users in 37 countries and become a multilingual, global Web portal and Internet access provider. Lycos is the fourth-biggest portal in the United States and already serves as a portal in 25 countries through 65 sites in 13 languages.

U.S. Web monitoring companies are responding to that growing market as well.

For example, Jennifer Fan at Nielsen NetRatings said her company is setting up a monitoring system for Latin American Web traffic.

Latin America won't generate the most revenue of all non-U.S. regions, but because of geography and the large Spanish-speaking population of the U.S., it is a target of a lot of U.S. companies, especially those run by U.S. Latinos, according to International Data Corp. analyst Barry Parr.

"It's obviously a significant market," Parr said.

IDC expects Latin America account for $8 billion of the worldwide e-commerce market in 2003, whereas Asia is expected to account for $51 billion.

But Latin America's geographic proximity to the U.S. and the large Spanish-speaking population in the U.S. make Latin American and Spanish-language sites popular targets for e-commerce, Barr said.

Consejero.com, a Spanish-language financial information source based in Miami, announced an alliance last month with Atlanta-based DotPlanet.com to provide cross-content for Spanish speakers both inside and outside the U.S.

"International commerce really is the key market," Parr said.

However it isn't just U.S. dollars flowing into foreign companies. American companies are also benefitting from growing e-commerce with their southern neighbors.

The leading Mexican Internet portal, Mexico.com, announced last week it will sign on with KnowToday Inc. in Cincinnati for data filtration of its Web site.

In February, e-Companies Venture Group LP in Santa Monica, California, provided first-round funding for Mexico.com.

American telecommunications companies are also moving in on the wireless market in Latin America.

In February, AT&T Corp. announced the acquisition of the newly-formed Argentine local exchange carrier Keytech LD by its AT&T Latin America subsidiary.

The deal gives AT&T Latin America access to the Internet, data services and a unique 1910- 1930-MHz spectrum license to provide fixed wireless service in nine of Argentina's biggest cities, including Buenos Aires.

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