Net2Phone Sees Internet Calls Growing In Latin America
By Amy Guthrie
Of DOW JONES NEWSWIRES
["The company is also in discussions with three cable operators there to offer phone service over cable."]
MEXICO CITY (Dow Jones)--Latin America might just be the perfect playground for voice-over-Internet services company Net2Phone Inc. (NTOP)
Calling rates are still fairly expensive throughout the region, and demand for international phone service is high.
"We believe that Latin America is going to be one of our growth engines," Bryan Wiener, president of Net2Phone global services, said in a phone interview.
Roughly 30% of Net2Phone's annual revenue of $80 million stems from Latin America and the Caribbean, be it from Internet calling booths in Ecuador or calling cards in Trinidad and Tobago.
"Anybody that's paying attention realizes that voice over Internet is going to fairly radically change the market over the next five years," Wiener added.
Net2Phone, based in Newark, NJ, has over 400 local partners around the globe that help the company maneuver through varied regulatory environments. The debate is still raging in the U.S. on Voice over Internet Protocol technology, or VoIP, that uses data lines to transmit calls. Elsewhere, in countries like Panama, the market is deregulated.
Callers can dramatically reduce their communications costs by using VoIP lines, but so far only corporate customers have been given the universal green light to savings.
Sample plans include 500 minutes of calls for $14.99 a month.
Businesses can also order four-digit dialing plans for inter-office communication, slashing the cost of those calls almost to zero. That's a huge savings considering that more than 35% of business calls are typically between employees of the same company.
Net2Phone expects to offer these enterprise services for companies, as well as calling cards, with a licensed partner in Brazil before September. The company is also in discussions with three cable operators there to offer phone service over cable.
Net2Phone is hoping to reap significant revenues over the next two years from Brazil and Mexico, the two biggest economies in Latin America. Mexico, though, is proving to be a more difficult market to crack.
"It's a complex regulatory environment," said Wiener.
Net2Phone is in talks with licensed second-tier telecommunications companies in Mexico to form a partnership. Without such a partnership, the company cannot offer services like discount calling cards.
-By Amy Guthrie, Dow Jones Newswires; (5255) 5080-3453; amy.guthrie@dowjones.com
(END) Dow Jones Newswires
05-17-04 1758ET- - 05 58 PM EDT 05-17-04 |
