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Analysis

Telecom Needs, Services Boost Innovation

Fri, 12/01/2017 - 15:03

A fast-evolving and connected world needs fast-evolving technology and constant innovation to support its growth. The aerospace and aviation industries by nature must evolve, improve and connect continuously, and they have not fallen behind in Mexico.

Be it telecommunication satellites, data processing solutions, bandwidth, electronics, automation software or robots, Mexican companies, research centers and government agencies are deeply involved in creating and implementing technological solutions. As Industry 4.0 practices permeate the Mexican manufacturing industry, it is becoming imperative for local companies to employ automation and Big Data processing solutions into their operations.

The aerospace industry is young yet ripe enough to fully integrate into the global value chain. Aviation in Mexico has not seen a major demand downturn since the Great Recession of 2008-2009. Both industries offer various opportunities for growth and development. As the aeronautics sector is consolidating, it is the ideal time to start focusing on manufacturing and assembly of space components, industry experts say. “This is the moment for aerospace companies to turn to Mexico and make the necessary investments that will eventually support their global plans,” says Gunther Barajas, Vice President Mexico of Dassault Systèmes.

The World Economic Forum’s 2017-2018 Global Competitiveness Report states that Mexico’s technological readiness ranks 71st of the 137 evaluated countries. The country lags in comparison with other Latin American countries such as Argentina and Brazil in this parameter. The growing need to send, analyze and process the large amounts of data that the country, its citizens and its manufacturing companies require, especially with the introduction of Industry 4.0 practices, will only place a greater importance on the development of telecommunication infrastructure to sustain the country’s development.

According to the World Bank, 88 out of every 100 people in Mexico had a mobile cellular subscription in 2016, a number that has grown exponentially since 1988, when only one in every 5,000 had one. The ability to connect rural Mexico with the country’s urban areas via microwaves did not take place until 1985, when the Morelos I satellite was placed in orbit.

The increasing importance of telecommunications and the opportunities that the 2014 Telecommunications Reform brought along have spurred a steady growth in the participation of the telecom sector in the total GDP of the country, growing from 2.7 percent in 2011 to 3.5 percent in 2017. The number of workers in this sector grew from 226,953 to 256,628 during this period.

EYE IN THE SKY

As the trend toward smart cities and smart factories continues unabated, the future is in the growth of telecommunications that can support Internet of Things (IoT) and Industrial Internet of Things (IIoT), providing sustainable, trustworthy Industry 4.0 practices. This will require better internet infrastructure, including satellites.

Francisco Mendieta, General Director of the Mexican Space Agency (AEM), points out that the emergence of Big Data has expanded the requirements for communication and information processing and pushed countries to demand better communication systems. “Satellites can be a good solution for countries that are developing land infrastructure but need an integral, short-term solution that guarantees access to broadband, and can be deployed quickly with low risk. Emerging economies like Mexico invest in satellites for fast, economical and reliable infrastructure and telecommunications support.”

Since the first Mexican satellites were launched and the whole country was connected for the first time, the use of privately and publicly funded Mexican satellites has become commonplace. But they have failed to include any percentage of Mexican-developed technology. Rodolfo Neri Vela, a telecommunications expert and the first Mexican in space, underlines the importance that satellites have had in the process of accelerating trade and banking processes and enabling companies and government agencies to install their own networks, but points out that the lack of any Mexican- produced component in any of the Mexican satellites has been a mistake that should not be repeated. Generating or at least assembling space technology is a crucial step, he says. “It is necessary to start thinking about the next generation of satellites and to demand that their manufacturers invest in Mexico and generate both knowledge and human resources so that at least 5 percent of the satellites’ components are made in Mexico,” says Neri.

ProMéxico’s Orbit Plan 2.0 (Plan de Órbita 2.0) outlines targets for Mexico to have a 1 percent share of the global  market by 2026, to be a global leader in the space sector in terms of market share by 2035 and for the country to have a renowned role in the development of components, products and services. However, “Mexico’s space sector is still far from reaching these goals as the budget for AEM is scarce, the training of human capital in the aerospace industry usually focuses on aeronautics and there are few projects that can attract companies to enter the space sector,” says Neri.

Mendieta, however, expects a larger participation of local technicians, operators and companies in the next bids for space vehicles and ground operations, which will likely boost the national space sector. “AEM is surveying companies with capabilities in mechanics, materials, software and orbital studies for the space sector. The tender for the [next] satellite will include Mexican companies and professionals from the beginning,” he says.

INDUSTRY 4.0

The rise of Industry 4.0 has meant delivering advanced manufacturing solutions that improve operations across several sectors, boosting efficiency and improving salaries of increasingly skilled workers across various sectors. In aerospace, where quality control and innovation are key for successful operations, small companies have a hard time accessing these solutions as the prices for necessary equipment and software are high. The goal, then, is to help SMEs access this technology and take advantage of it through different means.

FabLab Chihuahua, for instance, helps local SMEs generate high added-value products and services by offering design, product development and reverse-engineering services and granting SMEs access to state-of-the-art laboratory equipment that these small players could otherwise not employ, which helps local companies improve their manufacturing operations. On the other hand, Bernd Schreiber, General Manager of FESTO, a global pneumatic and electric automation technology producer, sees hardware and software developers racing to be at the forefront of Industry 4.0 practices. But technology development goes hand in hand with alliances as a single company cannot develop all the required technology on its own.

“Industry 4.0 is a concept that will continue developing hand in hand with technology in the coming years. SMEs must become aware of the necessity of investing in technology (because it) ... can reduce costs by 15-20 percent and in some cases, up to 30 percent,” says Schreiber.

Finally, as automation is a key part of Industry 4.0 practices, the entrance of robots to production lines in Mexico’s manufacturing sector is both a challenge and an opportunity for technology companies – a challenge because potential customers may not be able to pay the cost that robots generally entail, an opportunity because the high level of competition to enter the manufacturing sector means companies want an edge.

Manuel Sordo, South Central US/LATAM Sales Manager of Denmark-based robot builder Universal Robots, says that since acquiring these devices can be daunting for SMEs, creating maintenance-free, easy-to-repair robots and selling them at competitive prices will make these solutions more accessible to small companies and provide a return on investment in only three months. “There are thousands of companies competing at an entry level and the only way for them to participate in advanced manufacturing activities is by investing in automation,” he says.

Telecommunications is an essential part of any economy’s backbone. The challenges brought about by an increasingly interconnected manufacturing industry through Big Data are evident as they place stress on the telecom infrastructure to grow and improve to meet demand. The aerospace and aviation industries in Mexico will continue creating and implementing technological solutions to improve efficiency and better compete in the international market.

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