Nearshore Americas

As a Monopoly Comes Crumbling Down, a Mexico CIO Sees Opportunity

Mexico’s new telecommunications legislation and the trend toward having more data hosted in the cloud are spelling big opportunity for local Chief Information Officers (CIOs) active in the services market. CIOs such as Alestra’s Carlos Lerma Vázquez are addressing the business logic of a range of technological platforms, while also speaking to the all important considerations of security, uptime, and return on investment.

“As a CIO I am expected to support all of Alestra’s systems, and also to act as a trusted advisor to our clients,” says Lerma Vázquez, speaking from Alestra’s offices in Monterrey. “In the context of client demand, the challenge is to educate them on our technology portfolio, so that they can understand what we can do for them.”

Alestra has been active in the Mexican telecom market since 2007. The company’s technology investments have a specific focus on network connectivity and data center capabilities. Clients include local corporations and multinationals, with specific focus on the health, education, and government sectors. The company takes pride in its security and cloud-based offerings. Here, however, a CIO in Mexico has his work cut out for him, and must convince clients that the platform is reliable and scalable.

“We have seen that when it comes to cloud-based technology, we have to work to build confidence among various organizations,” says Lerma Vázquez. “There can be complications in entering this market, but in the past year we are seeing more and more companies gaining confidence in the cloud.”

From Alestra’s perspective, that might be due to the emphasis the company puts on security. The telecom services firm has a unified threat management (UMT) and an intrusion prevention system (IPS) that allows for forensic analysis. This is all conducted out of the company’s center for security operations.

“Depending on the type of customer, we can offer security in the public cloud, in a collocation environment, or one that is totally dedicated to the client,” says Lerma Vázquez. “These services are delivered by certified professionals to global standards.”

Industry certification is front and center to the technology value proposition. This allows a CIO like Lerma Vázquez to show prospective clients that the company can function in a multi-vendor environment, while also indicating that security is top of mind. Examples of Alestra technology certification partners include Cisco Systems, Microsoft, Fortinet, RSA, Trust Wave, Blue Coat, and Spamina. Numerous engineers also have third party certification from organizations such as ITIL and ISACA.

Technology & Business

Lerma Vázquez says that the ability to isolate applications and hardware has great appeal for sensitive Mexican public sector clients in health and education. As CIO, he must position his company’s technology capabilities to match those where client demand is strongest, which in the context of Mexico’s new digital strategy involves a strong focus on the public sector.

“Each time we engage a client, they gain more confidence in the cloud,” says Lerma Vázquez. “It is a flexible platform that allows for rapid changes. We have seen a lot of clients engage with this technology without compromising their operations.”

To get the word out, CIOs are expected to offer expertise on various marketing and education initiatives. In Alestra’s case, that includes webinars, bulletins, and the company’s series of summits in 2014, which are to be held in Querétaro, Mexico City, Monterrey, Guadalajara, and Tijuana. Having this sort of initiative as part of a strategic plan is crucial if telecommunications service firms in Mexico are to succeed.

“These summits are an opportunity for us to demonstrate our technological capabilities to prospective clients,” says Lerma Vázquez. “We’ve been doing them for a few years now; they show entrepreneurs and businesses the importance of these various solutions, and also allow them to meet our technology partners.”

Alestra’s broad offering, which includes everything from managed storage to enterprise hosting, as well as IP-based unified communications and outsourced helpdesks, will likely deepen if Mexico’s President Enrique Peña Nieto is successful in passing secondary laws that ensure competition in telecommunications. These will be necessary because, in order for the president to get his first batch of reforms through, the reforms had to be watered down in order to ensure approval from Mexico’s divided Congress. If successful, these new laws would be approved by the end of April, which is when this next legislative period ends.

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Andres Audiffred, an analyst in Mexico City, has said that these secondary laws would be “tough to evade,” as they allow for regulators to engage in a more thorough review of non-competitive practices. Under the present reforms, dominant players like America Movil SAB are facing price regulations, and may even have to sell off some assets. Either way, the trend is clear: the market in Mexico is opening up, and services firms with strong technological offerings — and the CIOs who back them up — are primed to compete.

Tim Wilson

Tim has been a contributing analyst to Nearshore Americas since 2012. He is a former Research Analyst with IDC in Toronto and has over 20 years’ experience as a technology and business journalist, including extensive reporting from Latin America. A graduate of McGill University in Montreal, he has received numerous accolades for his writing, including a CBC Literary and a National Magazine award. He divides his time between Canada and Mexico. When not chasing down stories, he is busy writing the Detective Sánchez series of crime novels.

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