Blog Post

Cloud computing is Latin America’s great equalizer

Mike Wolf (GigaOM Pro), Wenceslao Casares (Bling Nation), Rich Lechner (IBM) - Structure 2011When Wenceslao Casares was building the Argentine online brokerage Patagon in the mid 90s, he pretty much had to build everything from scratch — from the servers to storage. With spotty infrastructure and broadband access across Latin America, it was a real challenge to get the “E-trade of Latin America” off the ground.

Casares couldn’t foresee a time where things would get any easier outside the United States. “If you had told me back then, I would have had a very hard time believing you,” he said. “The leapfrog in terms of connectivity has been impressive.”

Here in the United States, cloud computing has allowed emerging companies to build much faster and much cheaper. But in Latin America, the development of the cloud has been nothing short of transformative. And developments are moving rapidly. Last year, Brazil experienced its fastest economic growth in almost two decades. Gross domestic product expansion was double what economists had expected the country to reach.

“It is really leveling the playing field. I was surprised to see them take to the cloud even faster than here [in the US],” Casares says.

Casares and Rich Lechner, IBM’s vice president of cloud and services marketing, discussed the opportunity for cloud services in Latin America this morning during GigaOM’s Structure conference.

While the region has been behind the United States in terms of technology and internet infrastructure, that might actually be an advantage when it comes to deploying the cloud now. “They don’t have as much of a legacy infrastructure to contend with. It’s existing in some areas and not in others. You can deploy it where it exists an provide across the region,” Lechner said.

There are big opportunities for US companies in countries like Brazil, where local cloud services are just starting to materialize. IBM has one of its six global data centers in Sao Paulo as well as two cloud innovation and security centers.

But there are still challenges to overcome, even in Brazil. Speed isn’t universally available. Broadband access is very spotty. “It’s faster and cheaper than in U.S. in some places but the fiber might not make it down the road. It looks like here five years ago,” Casares said. Still, the deployment of the cloud is pushing the extension of broadband services.

Overall, Casares  is confident. “They are building infrastructure remarkably fast,” he said. “What used to take 10 years in now being done in 12-18 months.”

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