Web businesses targeting Hispanics

It is interesting to see that more and more people are thinking about serving the needs of Spanish speaking people within the U.S. and in Latin America.

François Schiettecatte in GigaOM Introducing, Boston Start-Ups with Hispanito «:
Derely says that the Spanish speaking community is very under served and most of the social networking sites are targeted to English speakers. The popularity of Fotolog, Google’s Orkut and Hi5 in some parts of Latin America indicate that targeted consumer services focused on the Latin American market can become thriving businesses, even though only 20% of Latin America has access to the internet. The internet connections are growing at a rate of 30% a year. At present there is about 8.2 million broadband connections in the Latin America. Derely feels there is a lot of room to grow but it will take 2-3 years to really pan out.

As readers of this blog probably have noticed I live in Panama and run a software development business there. Panama and other Latin American countries have a lot of talent interested in this line of work. And of course there are a lot of potential customers. The only problem I see at the present time is that on one hand people don't have the money to buy a lot of services and when they do they can't pay by credit card. So there is a need for other payment mechanisms and services have to be cheap. Further one should keep in mind that the majority access the Internet from public computers in Internet Cafe's for about 50 cents per 30 minutes.

It will take quite some time to come to the point that a significant number of people - first of all - own a computer and then can afford broadband Internet. For example here in Panama a 256 Kbit/s (yes, it's that slow, but still called broadband) connection costs about USD 25 monthly. For the same price you can have dinner for two at a nice restaurant. To put that even more into perspective: most people earn a monthly salary around USD 600. It really is not that easy to afford a computer with Internet access when you need the money to make ends meet.

The opinion, as expressed in the cited article, that it make take 2-3 years to make a service grow successfully, which means generate enough revenue, might be a bit too optimistic. The amount of disposable money won't come up that fast in Latin America.

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