ICT spending in RP growing by a slower 6.3% this year

MANILA, Philippines – Research firm International Data Corp. (IDC) has scaled down its growth projections for information and communication technology (ICT) spending in the Philippines for 2009 to 6.3 percent, from an earlier forecast of 10 percent.

It said while the remittance level will remain comparatively stable, the financial meltdown in the United States, the country’s second-largest export market, may hamper overall ICT investment in the Philippines.

The drop in IT spending growth is significant due to the anticipated lower end-user spending habits in the face of the global economic crunch.

However, IDC said it believes the country still offers opportunities, especially as the Philippine market is not as advanced as other Asia Pacific countries when it comes to ICT adoption. The continuing trend of market expansion outside the Metro Manila area toward the provincial centers is seen to greatly aid in maintaining a positive outlook in 2009, it added.

It also expects that as the effects of the worldwide economic downturn gradually reach Philippine shores, local telecommunications players will adapt to the changing economic environment and eventually reconsider their marketing efforts, product focus, and, for some, even spending.

Though IDC maintains that the telco sector will be among the industries moderately hit by the temporary slump, most players in this field will still be reassessing their business strategies for continued growth, it said.

Despite the anticipated cautious spending on ICT in the Philippines, IDC predicts that specific pockets of opportunities will exist, driven by regionalization and market expansion outside the Metro Manila.

IDC noted that the heightened ICT awareness in both the consumer and commercial sectors will also contribute to this growth. Although there are still some segments in the country that have yet to fully adopt or implement ICT infrastructures, gradual steps by ICT stakeholders are being taken to address this, it said.

“Given the current global economic outlook, ICT stakeholders would need to look into product offerings alignment while accelerating the pace of change. This would also involve strengthening their channel network capability across the country and more importantly, seeking new opportunities, bearing in mind wild-card events and the psyche of Pinoy ICT users,” IDC Philippines research manager for ASEAN IT spending Jubert Daniel Alerto said.

He also noted that within a downbeat market, there lies specific pockets of opportunities spawned by the need to continually reduce overall ICT adoption cost in the long-term while also ensuring that market and customer traction is secured.

IDC also expects investments in “green IT to gain popularity in the context of greater cost savings. Green IT adoption slowly made its way into the Philippine ICT market and is expected to boom in the next 12 month.– Mary Ann Ll. Reyes, Philippine Star