Japanese vendor NEC has announced that Spanish incumbent operator Telefónica has launched cloud services in the Argentinian market using the NEC cloud platform. The two companies announced a strategic partnership in February this year to promote cloud computing in Latin America.

NEC said that Telefónica will be offering Argentinian customers an SaaS product “designed to facilitate access to a variety of digital applications and services where the customer only pays for the number of licences that are used.”

The new offering will be targeted initially at small and medium-sized enterprises in the region that may lack the budget for traditionally delivered technologies and IT applications.

Informa analyst Daniele Tricarico said that Telefónica has a first mover advantage with SaaS in Latin America given plans to roll out across the region, which gives it a lead over Latin American powerhouse America Movil. The sector is likely to become more competitive, however, and more crowded.

“SMEs represent a fast-growing segment across all LatAm economies,” Tricarico wrote in a case study on Telefónica, available at www.intelligencecentre.net. “There is a clear opportunity for operators to respond to the increasing demand from SMEs for both globally and locally relevant applications through SaaS. However, in emerging markets many SMEs are microenterprises with fewer than five employees, and generally they are more price-sensitive than in mature markets. A key challenge for operators will be to price applications correctly while maintaining a profitable business model,” he wrote.

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