IDC: Tech spending in PH to continue in 2011

Following a recovery in information and computer technology (ICT) spending last year, the Philippine market will be characterized by further revitalization and sustained growth in technology spending in 2011, analyst firm IDC said on Thursday as part of its annual predictions for the Asia Pacific region. Across Asia Pacific and in the Philippines, a significant majority of businesses will be focused on further business expansion, both in terms of market share and penetration, and will leverage heavily on ICT as a key business enabler, IDC said. The ability of ICT to deliver critical business upshots will become an even more important requirement and expectation from CIOs and line-of-business managers in 2011, it added. “In 2011, fueled by the increased complexity in ICT needs of enterprises, as well as the ever-evolving needs of SMBs and consumers’ increased usage of ICT, the market will see an even larger scale of competition. As a result, ICT stakeholders such as vendors, service providers (SPs) and channels would need to focus on coming up with products and services that offer specific business value to clients; smart pricing models; more tactical partnerships with strategic players within the ICT ecosystem; and, feeding channels with transformational initiatives," said Jubert Daniel Alberto, manager for IT spending research at IDC Philippines. The following are the top 10 predictions that IDC believes will have the biggest commercial impact on the ICT industry in the Philippines in 2011: 1. Philippine IT spending will see sustained growth in 2011 The Philippine IT spending is forecast to reach $3.63 billion by end of 2011. The country is also headed to post a 12 percent compound annual growth rate (CAGR) from 2006 to 2014. The political stability and upbeat direction of the economy has fostered confidence among vendors to spend on marketing efforts. Consumers, on the other hand, are also expected to spend due to the continuous improvement of the economy and to some extent, the purchasing power of Filipinos. 2. Telco spending will record modest year-on-year (yoy) growth of 6% in 2011 IDC anticipates a 6 percent YoY growth on overall telco services in 2011, reaching $4.49 billion by year end. Operators are continually moving to capture demand from mass markets, as well as the uncharted territories outside the big cities throughout the country. In addition, fixed line operators are seen to make bigger concerted efforts to explore and exploit new revenue streams. 3. Expected rise of media tablets will drive further portability and increased data consumption Filipinos have been waiting in anticipation for the slated tablet PC launch in 2011. With its ability to propel bigger IT spending and introduce a more mobile IT environment, IDC believes that tablet PCs will be one of the key growth drivers for IT in the Philippines. On a worldwide level, IDC predicts the media tablet phenomenon to result in the shipment of more than 57 million units in 2014, exceeding deployment of mini notebooks. Locally, the media tablets and all the hoopla around it are projected to challenge, rather than completely overthrow, the mini notebooks. 4. From being just a theory to realization — 2011 will mark the dawn of the cloud era With a rich pool of clients waiting for cloud service offerings, providers of cloud services will have their hands full starting 2011. Cloud computing is becoming the buzzword for some SMEs and MNCs alike. The demand to increase business productivity will pave the way for SPs and MNCs to look into a new medium of managing and optimizing business systems – through the cloud. 5. Intelligent SMBs: social media and consumer technologies will adopt bigger roles among SMBs In 2011, IDC expects SMBs in the Philippines to increase usage of social media and consumer technologies. They will be regarded as solutions to achieve more benefits from technology adoption while working within limited budgets. The needs of SMBs are far more than scaled-down or “mini-me" versions of enterprise solutions. SMBs are a diverse group of businesses with disparate needs but limited funds. In the coming year, SMBs’ ICT needs will intensify, but, as with their larger counterparts, priorities will focus on reducing total cost of IT and aligning or adapting IT to the changing business landscape. 6. Mobile operators will blur lines between intra- and inter-network pricing In 2011, less exclusivity and more liberality will be the name of the game, with SPs relaxing their competitive boundaries though call-all, text-all networks schemes. SPs will be more lenient with their pricing schemes on calls and texts due to promising revenues from data consumption brought about by the increasing popularity of smartphones and Web 2.0 applications such as Facebook and Twitter. 7. Increasing usage of smartphones will give birth to new security models In 2011 IDC expects smartphones to comprise 23 percent of mobile phone shipments, as compared to only 18 percent in 2009. With the growing ownership of smartphones, coupled with the proliferation of more affordable mobile data plans, more and more employees are seen to use their personal mobile devices to access corporate information. This growth, however, comes as a double edged sword: accessing corporate data using personal devices can be a key factor in confidential data loss. In this regard, IDC predicts that increased usage of smartphones for both personal and business use will give birth to new IT security models in 2011. 8. Social analytics will be “the next big thing" to social media With the rise in social media technologies usage, investments on social analytics tools are expected to grow in 2011 as businesses start to realize the importance of data mining and how analytics tools can help them generate insights for future decision making and market predictions. In a survey conducted by IDC, one of the main IT-related priority of companies in the Philippines is to build better management tools to help them make better business decisions. 9. Web applications and social media will drive dynamics in flourishing smartphone market IDC believes that in 2011, web applications and social media will shape trends in the smart phone space, driving dynamics in areas such as pricing, features, and operating systems. The usage of Web 2.0 applications, whether social-oriented or media streaming, through mobile devices is rapidly increasing. This is expected to increase accessible customer data as well. 10. Business process outsourcing (BPO) in the Philippines will see continued traction In 2011, IDC believes that notwithstanding issues on manpower challenges, the BPO market in the Philippines will continue to see traction in terms of worldwide share of offshore services. The Philippine BPO industry will continue to perform well across the five (contact centers; HR, and finance and accounting outsourcing; medical transcription; software development and animation) key segments. However, maintaining its value proposition in the global BPO scheme of things in light of the intensifying competition and the presence of issues that could affect the industry’s growth prospects in the country will be the key factors that need to be resolved in order for the industry to continue to thrive. — Newsbytes.ph