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Microsoft 2002 LatAm sales reach US$800mn

Bnamericas Published: Thursday, May 29, 2003
US-based software giant Microsoft (Nasdaq: MSFT) billed US$800mn in Latin America in its fiscal year ending June 2002, regional marketing manager Martin Naor told BNamericas. Though the executive declined to give projections for the region up to June 2003, he said Microsoft expected to see billing growth, adding the biggest competitor in Latin America for Windows and Office solutions is piracy. "We base our view on the studies by the Business Software Alliance [BSA], which indicate that piracy is very high in countries such as Paraguay, Bolivia and Uruguay, in contrast to Chile and Mexico," Naor said. "Levels of awareness of intellectual property in Latin America are low in comparison to the US and Europe," he added. The latest annual study by the BSA found that last year the level of program piracy in Latin America hit 55%, while the rate reported for North America and Western Europe was about 24% and 35% respectively. Bolivia closed last year with a piracy rate of 74%, with Paraguay registering 71%, Uruguay 60%, Chile 51% and and Mexico 55%. Latin America represented 6% of Microsoft's US$13bn global loss attributable to software piracy in 2002. Nevertheless, Naor recognized that the company is competing strongly in the region against IBM, as well as Sun Microsystems in the server operating system segment and Oracle in databases. He added that the principal Latin American markets are Brazil, Mexico, Colombia, Chile, Puerto Rico and Argentina. For Microsoft, Puerto Rico is a small-to medium-sized market, representing a good business opportunity due to the strong presence of US firms there. Argentina also remains a large, sophisticated market in terms of IT potential for the company, despite the economic crises the country is now recovering from. As for the regional business model, Naor said Microsoft is prioritizing the development of innovative solutions, with a sales strategy based on commercialization of large volumes at a reasonable cost. "Our business model is based 100% on a partnership structure such as we have with Sonda in Chile and many others in the region," he said, estimating there are now 30,000-40,000 strategic partners.

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