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1 o p e n t e l e c o m m u n i c a t i o n s © Open Telecommunications 25-Aug-14 Open Telecommunications Latin American Business Growth Mike McKeown Business Development Manager
2 © Open Telecommunications 25-Aug-14 About Open Telecommunications Global Headquarters Sydney Founded in 1992 Public company listed on Australian Stock Exchange in 1999 Experienced technical software and telecommunication engineers Open - Compliant with telecommunications standards Committed to telco space Global Presence Winner of Multiple Industry Award
3 © Open Telecommunications 25-Aug-14 The Telecommunications Software Market De-regulation Creates competition Improves Services Reduces Costs to Consumers Drives Demand Open Telecommunications Software Enables transition to single network architecture Provides platforms to roll-out feature rich services Provides simplified provisioning processes
4 © Open Telecommunications 25-Aug-14 Offshore Investments Why OT invests offshore Products Developed are “World Class” Market diversification for revenue stream protection Need to grow revenue streams outside of Asia / Pacific Proven ability to compete with multi-nationals Need to improve service to existing customers Partner Strategy or OT Direct? Hub and Spoke Strategy
5 © Open Telecommunications 25-Aug-14 Why and Where in Latin America? Market Demographics 350 Million inhabitants presents large telco opportunity Currently 53 Million Fixed Lines and 23 Million Mobile Deregulated environment stimulating competition Brazil (OT’s Gateway) Projected US$10bn in Telco investments over next 4 years Telecoms growth rate around 25% p.a. Mobiles 17mn mn 2005
6 © Open Telecommunications 25-Aug-14 Initial Business Development in Latin America? Methods Austrade for introductions Business Development visits Potential Partner Meetings Willingness to negotiate Results for OT BellSouth contract win - A$2.4 Million New Embratel contracts - A$6 Million Pipeline full of new sales opportunities Raised profile
7 © Open Telecommunications 25-Aug-14 Growth of a Market Established Direct Presence To support “new” contracts To provide “local” tongues To provide ongoing support To leverage into new REGIONAL opportunities To provide REGIONAL head office to support all growth Industry Development Today OT invests in University Software system OT contributes presenters to Industry conferences
8 © Open Telecommunications 25-Aug-14 Key Challenges For OT Brazil has very expensive labour costs Rio de Janeiro has very limited office space with increasing rents Key Management recruit required with English / Portuguese For all to consider Communication costs very high to Australia Time Zones provide effective 1 hour per day No “nickel and dime” entry longer than expected sales cycle for OT ROI longer than anticipated
9 © Open Telecommunications 25-Aug-14 Summary Pros Large Markets Investing early for technology uptake Revenue protection through diversified business Regions Deregulated environment stimulating competition English widely spoken/understood at Senior Business Levels Cons Expensive on-costs Longer sales Gestation period affects ROI
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