Adventures, Right to the Top – High Tech 1

On Tuesday afternoon in Chile the HT1 Team had a busy schedule. However, one of the most coveted interviews of the week was scored by Fernando Suarez.  He had set us up to meet Claudio Munoz, President, Telefónica Chile.  Fernando worked with Claudio years ago and was able to make the connection.

After going through considerable security at the Telefónica Building, we took the elevator to the top floor to meet Claudio.  Claudio gave us an overview of the company from its origins as a Spanish government owned company created in 1924 as Compañía Telefónica Nacional de España (CTNE). Telefónica was the only telephone operator in Spain and still holds a dominant position (over 75% in 2004). Since 1997, the Spanish government has privatized its interest in the company. One fact that we found interesting is that Telefónica is the second largest corporation in Spain, behind Grupo Santander (our big Chilean Bank meeting on Monday).

Telefónica owns Telefónica Chile, formerly CTC (Compañía de Teléfonos de Chile) that is the biggest fixed-line operator and internet service provider in the country. The Telefónica Group has been in the country since 1989. The mobile business is run by Telefónica Móviles through a local subsidiary. On 25 October 2009, Telefónica Chile changed its name to Movistar, including cellphone, landline, satellite TV, and internet.

Claudio shared that the change to the name Movistar was in part due to it being more attractive to the younger market that they believe is critical. Mobil penetration in Chile sits at 130% and Movistar is targeting the age group from 12 to 21 and call them the “Interactive Generation”.  In this target group, 70% of the phones are smart phones with a data plan.  Last year Movistar launched a communications satellite that makes it possible for all of Chile to have cellular capability.

We discussed with Claudio his thoughts on our Capstone focus area of mobile technology supporting health care accessibility and he was very supportive of these types of innovations that use the mobile platform.  He did give us the insight that some of the barriers to entry would be the doctors and the Isapres (countries private insurance companies).  They would need to be part of the value chain and buy into the idea.  Movistar is attempting to infuse innovation into Chile and its company.  They have an innovations group and are a major supporter of Start-Up Chile.

We sat and discussed many technology topics with Claudio that afternoon and as with all of our Chilean business meetings, there appeared to be no time pressure and the feedback we received was very candid and helpful.