Latin America It Market - Growth, Trends, Covid -19 Impact, and Forecasts (2023 - 2028)

Latin America It Market - Growth, Trends, Covid -19 Impact, and Forecasts (2023 - 2028)

The Latin American IT market is expected to register a CAGR of about 6.5 % during the forecast period. The increased IT spending worldwide, coupled with the widespread adoption of software-as-a-service and increased cloud-based offerings, indicates the demand for IT services in the industry. With an improved IT infrastructure, threats related to data (data breaches) are also on the rise, leading to a demand for advanced security solutions over traditional ones. With this trend gaining traction in the market, companies have started investing resources in enhancing their advanced security offerings.

• Trends like 5G, Blockchain, augmented reality, and artificial intelligence are anticipated to impact IT service offerings. With 5G technology on the horizon, businesses can set up networks on their premises. The digital revolution is intended to allow for the establishment of new networks based on local frequencies or the upgrade of current networks to LTE. This trend necessitates the establishment of real-time IT hubs to support the automation and autonomy of complex systems.
• A nonprofit affiliate of the Organization of American States participates in the effort and is dedicated to fostering Latin American economic, social, and political growth. For instance, in June 2022, the governor of Puerto Rico, Pedro R. Pierluisi, Labor Secretary Gabriel Maldonado-González, and executives from technology giant Microsoft signed a collaboration agreement that provides training for the people who are currently unemployed to become certified by the corporation within two years.
• In February 2022, Google, the world's significant public cloud provider, planned to expand its cloud into four additional major verticals in Latin America. The corporation established specific teams in Latin America to support the region's utilities, agricultural, manufacturing, and logistics verticals.
• IT services are gaining acceptance in the hybrid IT-managed environment as the IIoT platform expands across the Industry 4.0 platform. AI technology is also finding its way into the manufacturing and design sectors, fueling market demand throughout the forecast period.
• The vulnerability of supply chains was revealed with the outbreak of COVID-19. Most IT businesses' fragile ecosystems include providers of critical IT services. Work-from-home regulations compelled service providers to ensure that mission-critical enterprise customers have access to the tools and technology required to improve service speed, security, quality, and overall efficacy.

• Due to advancements in IT operation across the cloud-based platform, enterprise software has become more data-driven and real-time, creating greater value for the business, especially in operational efficiency, business opportunity discovery, and remote access optimization.
• Demand for higher efficiency and better control in procurement, chronic transportation bottlenecks, high freight prices, and the necessity to digitally connect all linkages in a complex ecosystem has reinforced and diversified the Latin American supply chain tech management market.
• The supply chain technology management industry is controlled by large ERP management software vendors, such as SAP, Oracle, Infor, and IBM, and regional businesses, like Totvs, which offer supply chain-specific suites in addition to their core ERPs. However, the cost and time required to adopt these suites may be prohibitive for many Latin American businesses.
• In March 2022, Quincus, a SaaS platform, launched new operations in Mexico and Colombia as part of their ongoing Latin American expansion. Quincus' technology optimizes, streamlines, and automates logistics for end-to-end processes by integrating AI and machine learning.
• With the huge demand from the IT and telecommunications industries throughout the ever-growing corporate sector, the opportunity for IT infrastructure services from these end users is likely to develop rapidly in the coming years.
• Adopting software robots to manage routine work carried out by temporary or seasonal staff or staff bursts required by regulatory spikes, new product launches, or some new operation is further boosting the market's growth.
• The increasing adoption of robot-based solutions for workplace automation across various end-user industries and the rising trend of cloud-based solutions are likely to generate new prospects for establishing robotic process automation. This transformation is providing an opportunity for the growth of IT services in the region.

• The IT sector is a critical component of the modern era. From transportation and manufacturing to nuclear power plants and medicine, the software has the potential to improve people's lives. Human dependency on software is growing as the world progresses through a century of artificial intelligence, machine learning, automation, and 5G technologies.
• According to the International Trade Administration, Mexico is establishing itself as a high-quality software provider for the automotive, aerospace, and finance industries. Throughout the country, 38 IT clusters provide software development, call center, high-tech manufacturing, and engineering services. Mexico is following the worldwide trend toward a service-centric IT business, where most technologies are provided through a service contract or lease, creating opportunities in Software-as-a-Service (SaaS), Infrastructure-as-a-Service (IaaS), and Platform-as-a-Service (PaaS).
• Technology is crucial in supporting the manufacturing industry's future growth ambitions. This industry is becoming more mechanized and technologically-based. Companies are eager to deploy new operating systems or improve existing ones, often overwhelmed by the alternatives available. The software generally enables firms to streamline operations and deal with product quality and proficiency issues.
• Information technology is crucial for today's telecommunications industry. Providing telecommunication services requires a huge amount of IT support. Real-time processes like prepaid billing accounts require a fully IT-automated process chain, which may fuel the market during the forecast period.
• In Latin America, according to research by the Ibero-American Telecoms Organization (OTI), the region's telecommunications business registered USD 32,632 million in Q3 2021, representing a 6% rise.
• The Mexican Internet Association estimated that the number of internet users in Mexico will increase by 10.2% by 2020. The country had 84.1 million internet users in June 2021, accounting for 72% of the population over the age of six. About 96% of internet users in Mexico use a smartphone, and the country currently has 88.2 million active smartphone users. As a result, demand for telecommunications may increase during the forecast period.

The Latin American IT market is highly competitive and consists of a few major players. Some of the players dominate the market in terms of market share. However, with the advancement in IT consultancy services, new players are increasing their market presence, thereby expanding their business footprint across emerging economies.

• September 2021 - Accenture announced its intention to purchase Experity, a significant cloud-based customer experience and commerce solution provider in Brazil. Expertly assists businesses in increasing efficiencies and agility in commerce, marketing, content, and data through pioneering cloud-based solutions.
• March 2021 - IBM announced the launch of its first IBM Cloud Multizone Region (MZR) in Latin America, signaling a significant expansion of the company's cloud footprint in key countries worldwide. The MZR, which expands on the company's existing data center footprint in Brazil, is the result of the company's ongoing investment in cloud infrastructure to promote hybrid cloud adoption and support corporate growth in Latin America.
• January 2021 - American Tower agreed to buy 31,000 communications sites in Argentina, Brazil, Chile, Germany, Peru, and Spain from Telefónica's infrastructure company, Telxius, for USD 9.4 billion.

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