Philippine corporate ICT spending seen rising 10.1% -- IDC

Posted on January 26, 2015

THE INFORMATION and communications technology (ICT) industry is projected to continue its upswing this year, as companies plan to increase information technology (IT) spending by 10.1% driven by the so-called “3rd Platform,” which is composed of the cloud, mobility and social business, research firm International Data Corp. (IDC) said on Sunday.

Citing its Annual Continuum Survey, IDC said that bulk of Philippine companies are looking to increase ICT budget and spending in 2015.

“This indicates a healthy sign for the country in the bigger scheme of things. ICT spending is expected to be heavily impacted by the 3rd Platform and the usage of its technologies is being driven by the needs of companies seeking for new and effective ways of engagement,” IDC Philippines Country Head Jubert Daniel Alberto said in a statement.

“The adoption of disruptive technologies in the 3rd Platform, such as cloud, mobility, social business and Big Data and analytics are bringing about innovations in business models and consumption patterns,” he added.

IDC said that inhibiting factors, such as natural disasters and port congestion, will be short term only. “The country’s optimistic economic outlook, growing ICT demand from the consumer and small and medium-sized enterprise (SME) sectors, and the increasing requirement for the 3rd Platform technologies will shore up the Philippine ICT industry in 2015,” Mr. Alberto said.

The research firm said it expects Philippine IT spending to maintaining its momentum this year, projecting a growth of 10.1% year-on-year.

“The ‘changing of the guard’ on the political front has deeply transformed IT spending habits that will drive a stronger demand for mobility, devices, services, and applications across the country. The increasing ICT demand from SMEs and continued strong performance of the business process outsourcing (BPO) industry will also push ICT spending in 2015,” Mr. Alberto said.

Moreover, IDC said that the local telecommunications services market will show a positive performance in 2015, growing by 4.7%.

One of the key drivers, according to the research firm, is the growth in smartphone ownership, buoyed by declining prices and the continuing growth of local players. From the operator side, the upgrading and modernization of telecommunications networks and coverage have become the key focus areas, IDC said.

IDC said that the 3rd Platform technology mash-ups “will take partnerships to the next level with innovation as a necessity.”

“Philippine organizations will also start to increase innovation with newer technologies, starting with 3-D printing, and minimum level of Internet of Things into their business processes, and supporting these with improved interfaces and security,” Mr. Alberto said.

In 2015, IDC said that the so-called “Internet of Things” -- a concept that refers to Internet-connected everyday objects -- will arouse interest in the Philippines though adoption will be limited.

“While the market opportunity will drive activity, making this into a successful, long-term business model comes with a lot of hurdles,” the statement read.

To make the most of the trend, Jerome M. Dominguez, associate market analyst of IDC Philippines, said that companies “need to expand partnerships beyond the device and sensor markets to include connectivity, platforms, applications, analytics, and security.” -- Chrisee Jalyssa V. Dela Paz