CHATROOM: South Florida's tech scene
AOL unit sees silver lining in Argentina Posted on Mon, Mar. 24, 2003 BEA GARCIA bgarcia@herald.com
AOL EXEC: Charles Herington is president and chief executive of America Online Latin America. AOL is consolidating most of its call center operations from Mexico and Puerto Rico in Argentina. CHUCK KENNEDY/KRT FILE
Argentina's recent economic turmoil may have frightened away some investors, but others see opportunity there.
One is AOL Latin America, which will announce this morning that it's consolidating most of its call center operations from Mexico and Puerto Rico in a regional center in Argentina. The move takes advantage of lower labor and operating costs as well as a highly educated, technically savvy and Spanish-speaking workforce. The company will be adding about 200 employees in the next few weeks.
In a concurrent move, AOL Latin America, which is a joint venture between America Online and Venezuela's Cisneros Group of Companies, will concentrate its content operations in Mexico where it already has a strong team working in that area. The group will be producing generic Spanish-language content that can be used in the company's Argentine, Mexican and Puerto Rican portals.
AOL Latin America moved Martin Moreyra, who has been the director of content development in Argentina, to Mexico to work with the consolidated group.
AOL Latin America also operates in Brazil. Banco Itau, one of Brazil's largest banks, holds a minority stake in the Internet service provider and portal.
AOL Latin America is the front end of an emerging trend to use Argentina as a central location for regional operations.
A major U.S. multinational computer company already has established a regional call center in Argentina and several other companies have similar plans, sources said.
Charles Herington, AOL Latin America's president and CEO, says these two consolidating actions take advantage of the region's economic situation and meet objectives that have been driving the company in the past year: Cost reduction and more efficient operations.
After four years in business, the Fort Lauderdale-based company is still striving to reach profitability.
Losses from mid-1999 through year-end 2002 totaled $791.4 million. To the company's credit, however, it has been narrowing its losses significantly in the past 10 consecutive quarters.
AOL Latin America ended 2002 with $75.5 million in cash and said that money should carry it through the first quarter of 2004.
David Joyce, a stock analyst who follows the company for Guzman & Co. in Miami, estimates that AOL Latin America will have to borrow only $30 million in the second quarter of 2004 if it can manage to keep its costs ``more or less flat.''
That's why these latest initiatives are key, says Herington.
In 2002, the company saw its revenue grow 8.5 percent to $72.1 million. Its net losses shrank considerably, but red ink remains on the bottom line.
AOL Latin America's net loss fell to $180.6 million, or $2.69 a share, from $307.3 million or $4.66 per share.
The other major objective for the company is targeting high-value members, which means getting subscribers who are willing to stay with the service after the initial free trial period is over.
The company's shares closed Friday at 45 cents, up 5 cents for the day and 8 cents for the week.
MORE HISPANICS GOING ONLINE
Often, the beauty of statistics is that you can slice 'em and dice 'em any way you want -- and make them suit your point of view.
Last week, comScore Networks, the New York-based firm that tracks Internet usage, released highly anticipated data on Spanish-language Internet portals.
It provided a good view of where the top portals stand after nearly two years of transition.
Many of these companies made headlines in 1999 and 2000; all of them have been through significant downsizing and management, ownership and operational changes since then.
But the report does show the Internet has a growing number of Spanish-language users, and U.S. Hispanic are the fastest growing group. That was good news for Yahoo en Español, StarMedia, Terra.com, Univision.com, and MSN Group, which includes YupiMSN.
comScore released general data on Internet usage by Hispanics, but several of the portals put out some of the comScore numbers to best reflect their position in a market that is beginning to take off once again.
For instance, Terra.com, which is the Spanish-language portal of the Terra-Lycos network, put out a release saying it was a leader among portals for U.S. Hispanics who are bilingual and those for whom English is their preferred language.
Yahoo! was quick to point out that its entire network was the No. 1 choice for U.S. Hispanics in general and No. 1 for Hispanics here with a preference for Spanish.
Looking at the data in a less-partisan manner -- total pages viewed and total unique users -- here is how the portals shake out for the month of January:
• All Yahoo! Spanish sites: 155 million page views and 1.25 million unique users. • Univision.com: 148 million page views and 1.04 million unique users. • StarMedia: 121 million page views and 903,000 unique users. • Terra Lycos: 88 million page views and 1.02 million unique users. • Yahoo! en Español: 80 million page views and 845,000 unique users. • MSN Group: 61 million page views and 1.23 million unique users.
BELLSOUTH HELPS WITH AMBER ALERTS
BellSouth has joined Florida's Amber Alert network, providing alerts in cases of child abductions to more than 15,000 field technicians, 62,000 employees and 1.5 million Internet users in its entire nine-state region.
BellSouth will send electronic messages with alerts from the Florida Department of Law Enforcement to staffers in the field via pagers and laptops. The alerts will be posted on BellSouth's home page of its ISP users and on the company Intranet for employees.
The Amber Alert system is designed to put out notification of missing children as widely and quickly as possibly. The system and pending legislation to make it a requirement in every state got renewed attention two weeks ago after the return of Elizabeth Smart, the kidnapped Salt Lake City girl, because her family are big supporters.
While other companies and organizations such as electric and gas companies, TV and radio broadcasters, are supporting the Amber Alert network, BellSouth is making one of the biggest commitments since its operations and workers are spread over several states.
Amber alerts are named after Amber Hagerman, a 9-year-old girl abducted in Arlington, Texas, and later found murdered. Bulletins are distributed quickly through radio and television broadcasts and electronic highway signs about kidnapped children and their abductors.