Expansion, Business Optimization, And Consumer Dynamism Will Shape The Philippine ICT Market In 2008, Predicts IDC

Manila, January 24, 2008 – In its annual look at the year ahead, IDC predicts that expansion, optimization, and consumer dynamism will have the greatest impact on the Philippine ICT market in 2008.

"Regionalization is becoming a key strategy for vendors as they aim to realize more business opportunities by tapping the country's lucrative mass-market base. The need to be more efficient without sacrificing productivity will also be a major strategic focus among these companies. Consumer consumption will increase as more competitively priced yet more advanced products enter the market, especially in the mobile device space," says Jubert Daniel Alberto, Research Manager, IDC Philippines.

The following are the top 10 key IDC predictions that will shape the Philippine ICT industry in 2008 based from the document Philippines 2008 Top 10 Predictions: Expansion, Optimization, and Consumer Dynamism.

1. ICT Spending Will Reach New Heights

Overall IT spending is forecast to exceed the US$2 billion mark in 2008, reaching US$2.0273 billion, recording a 6% CAGR up to 2011. Spending in 2008 will likely revolve around maintenance or replacements of existing infrastructure. However, as companies strive to improve competitiveness, upgrades will also be a major portion of next year's ICT spending, with some enterprising firms focusing on strategic investments for the first time.

2. Government Will Lead The Way In Bridging The Digital Divide

IDC believes that the presence of solid economic fundamentals and strong government commitment towards ICT development and manpower training will enable Philippines to become a significant player in the global information society. Under the current administration, ICT has already become a buzzword, contributing immensely to the country's economic growth with programs such as the Philippine Cyberservices Corridor Program and the continued implementation of various government automation projects. IDC believes that this development will help untapped areas to become highly capable ICT locations, increasing the ICT investments in these areas, with particular focus on personal systems, networking requirements and telecoms-related spending.

3. There Will Be Increased ICT Developments In Regions Outside Of Metro Manila

IDC believes that the implementation of a decentralized development program by the government, better economic conditions, and an improved digital infrastructure, will encourage vendors to invest in more sales and marketing efforts to capture market opportunities in areas outside Metro Manila. With this, ICT spending from other regions, especially CALABARZON, Central Luzon, Central and Western Visayas, Northern Mindanao and Davao Region, are seen to significantly increase this year.

4. IT Will Get a Shade Greener in 2008 — Laying the Groundwork for a Green IT

The role of technology is integral as environmental concerns and corporate social responsibility become increasingly intertwined. Driven by efforts to make business operations more productive, efficient, and environmentally friendly, IDC expects that even in the Philippines, the concept of Green IT will start to make inroads. Vendors will start to introduce more Green products, and organizations will be driven to invest in these products.

5. Notebooks And Consumers Will Be A Profitable Match

IDC believes that the consumer market will drive growth in the notebook market in 2008. The portability of notebooks and the need to be mobile have become essential to the computing lifestyle. Furthermore, improvements in the wireless infrastructure have led to the growing availability of wireless technology (WiFi) in areas such as schools, malls, coffee shops, and restaurants. These developments have benefited end users immensely.

6. Integrated Security Will Be The Name Of The Game For SMEs

Security software adoption among SMEs has been gaining ground as a result of heightened vendor efforts aimed at increasing security awareness, and the growing need of SMEs to manage their data securely. As the electronic landscape evolves and faces continuous and more advanced security threats, IDC believes that the security preferences of SMEs will also evolve from being primarily basic defense mechanisms into integrated solutions that can handle complex threats.

7. Mobile Devices Will Get More Polished

IDC predicts strong growth in the number of multimedia devices that will be introduced in the market as newer applications targeting certain consumer market segments are developed. In addition, the coming year will see the entry of new players making waves in specific segments of the mobile phone market. Though general usage will continue to be limited to SMS and voice calls, more handset capabilities bordering on the employment of EDGE, WCDMA, and High-Speed Downlink Packet Access (HSDPA) will be forthcoming.

8. Pinoys Will Go Multimedia

IDC expects to see an influx of consumer services, particularly multimedia offerings in the forms of digital and audio content, in 2008, to utilize new capabilities brought about by new networks and technologies that were built in the last two years and to generate additional revenue, aside from the basic voice and data offerings.

9. Consumers will say "Yes" to 3G Phones, "Later" to 3G Services

IDC anticipates the interest level in 3G to increase in 2008, although adoption will be faster in the devices space than in the services space. Rising market interest, falling prices of handsets, and availability of more models catering to different purchasing skews, will further drive 3G phone ownership.

10. Continuous Broadband Demand Will Narrow The Gap Between Wired And Wireless

IDC predicts the continuous rise in FWA broadband subscribers in 2008, following a strong uptake not only in the metros but also in the surrounding suburbs and outskirts of the country. Over the past two years, wireless broadband will experience a fall in installation costs and initial expenses for connection.

For more information on this report entitled Philippines 2008 Top 10 Predictions: Expansion, Optimization, and Consumer Dynamism, please contact Sasithorn Sae-iao, IDC Marketing Executive for Philippines and Thailand at sasithorn@idc.com. Visit www.idc.com.my/philippines.

Contact

Sasithorn Sae-iao
Events & Marketing Executive
Tel: 66-2651-5585-87 Ext. 113
Email:sasithorn@idc.com