visual - may 17

World Telecommunication and Information Society Day

Between the time you start reading this article until you finish, you would probably send a text, receive a call, open an email, or viber a friend. After all, the Philippines is not only the texting capital of the world, with some 1.4 billion text messages sent by Pinoys daily, we are also the world’s “social networking capital” with 93% of the internet users on Facebook.

May 17 is declared the World Telecommunication and Information Society Day in recognition of the powerful force that has been shaping the world through its ubiquitous presence—information and communications technology (ICT). It also marks the signing of the first International Telegraph Convention and the creation of the International Communication Union (ITU) 150 years ago.

ICT refers to the extensive and integrated bundle of technology that handles telecommunications, broadcast media, intelligent building management systems, audiovisual processing and transmission systems, and network-based control and monitoring functions. Over the years, ICT has made the world a smaller place by providing means for users to always be connected. Aside from that, it is also one of the most potent economic drivers in recent history. 


Connecting Pinoys

As of writing, there are some 38 million active Filipino internet users, a little more than a third of the entire Filipino population. Most of the active users are between the ages 15-24 (40%) while those aged 45 and older are less active online. In fact, an average Filipino spends almost 17 hours on the internet every month. Some even spend as many hours in one day.

Filipinos access the internet through various platforms. Generally, they access the internet through their laptops or desktops but the World Startup Report noted in 2013 that smart phone growth in the country was at 34%, higher than in the United States of America (28%) and in China (31%). Soon enough, more Filipinos are expected to use mobile internet.

Social media penetration in the country is at 83%, much higher than in the US at 49%.  Overall, the most visited websites by Filipinos are Facebook, Youtube, Google, Yahoo!, and Blogspot. As per the local websites, Sulit.com (now olx.ph), MetroDeal, AyosDito.PH, Inquirer.NET, and ABS-CBN News get the most traffic. Interestingly, these statistics reveal that online interests of the average Pinoy — social networking, e-commerce, and information.


ICT and the Philippine Economy

The Internet doesn’t only serve well the interest of individuals vis-à-vis their connectivity to the material and the online world. More so, its paved a fast lane boosting changes in the way businesses and institutions deliver services to different parts of the world. With the increase in high speed internet connection comes a significant surge in economic growth worldwide.

A study conducted by the International Telecommunication Union shows that “by the end of 2014, there will be almost 3 billion Internet users, two-thirds of them coming from the developing world, and that the number of mobile-broadband subscriptions will reach 2.3 billion globally. Fifty-five percent of these subscriptions are expected to be in the developing world[1].” This recent trend breaks the “lag” caused by the “digital divide” between developed and developing economies[2], and proves that developing economies like the Philippines can be active and effective players in the global economic exchange through ICT.

The IT-BPM (business process management) industry is the 2nd largest income generator for the Philippine economy, next to remittances from overseas Filipino workers (OFWs). The IT-BPM industry in the Philippines continues to be strong as it posted an 18.7 percent revenue growth or about $18.4 billion. In an interview by The Inquirer, IT and Business Process Association of the Philippines (IBPAP) Chairman Danilo Sebastian Reyes said that this surge will continue because of the massive demand for voice and non-voice services from off-shoring industries[4].

Despite strong competition from other regions in the Asia-Pacific, “[a]ccording to Reyes, the Philippines remains the top destination for IT-BPO firms given the country’s scalable, educated talent pool; cost competitiveness; excellent infrastructure; adequate government support for the industry; and a proven track record[5].”
Challenges

According to the National Statistical Coordination Board (NSCB), the country ranked seventh in terms of ICT development in 2013, lagging behind its ASEAN neighbors. Internet penetration, which is a major indicator of ICT development, still remains relatively low compared to other Asian countries like Singapore, Malaysia and Brunei. The country ranked fifth in this indicator in 2012, according to NSCB.

The issues of internet cost and speed also bug the ICT industry in the country. Currently, internet in the Philippines costs ₱1000 per 1 to 2 Mbps[6]. This binary problem of high cost and low internet speed keeps the country’s ICT stunted and impedes further development in the said sector.

Recently, the Senate has pushed telecommunications companies to improve on the ‘slow but expensive’ internet connection that they provide. The PH average speed at 3mbps is the slowest among the Association of South East Asian Nations (ASEAN). Singapore has an average internet speed of 61mbps.


DOST Projects

The DOST-ICT Office is the front-runner in carrying out government projects and initiatives to develop and further strengthen the ICT sector in the country.

National internet empowerment is a key concern of the ICT Office. Recently, it launched Juan, Konek! in Pulilan, Bulacan. The aim was to encourage and educate Filipinos all over the country, urban-rural areas, to connect to their government online through their websites to learn how their government could best serve them.

Moreover, the “Free Wi-Fi Internet Access in Public Areas” project is the latest and grandest endeavor of the government to enhance internet penetration from Luzon to Mindanao.  By November 2015, the project aims to be able to provide 256kbps of free Wi-Fi to 105,000 concurrent users nationwide.

The ICT Office also recognizes the need to decentralize the ICT growth from Metro Manila to other parts of the country. The Next Wave Cities project identifies ICT hubs beyond Manila, based on criteria such as worker supply, telecom infrastructure and other factors necessary to sustain a local BPO industry. Rich sources of untapped talent, these locations provide good options for the IT-BPM operations beyond more established hubs and Centers of Excellence in Metro Manila, Metro Cebu, Metro Clark and Bacolod City. The ICT Office targets to create some 140,000 new jobs by the end of 2015.

Finally, the ICT Office rolled out its Philippine Startup Challenge (PSC) last year. It aims to encourage college students to think outside the box and come up with their own startups and business models. The ICT Office has also been supporting other startup initiatives of industry NGOs like the Philippine Software Industry’s SPRING.PH.

 

NOTES:

[1] See “2014 ICT Fact and Figures” by the International Telecommunication Union:

http://www.itu.int/en/ITU-D/Statistics/Documents/facts/ICTFactsFigures2014-e.pdf.

[2] Digital divide is the disparity between those who have and those who do not have or have a limited access and knowledge to modern information and communication technology. In an economic rubric, digital divide ensues between developed and underdeveloped regions of the world.

[3] See “Information Communications Technology for Development” by The World Bank: http://live.worldbank.org/information-communications-technology-development.

[4] See “IT-BPO sector posted 18.7% revenue growth in 2014” by Amy Remo in Philippine Daily Inquirer: http://business.inquirer.net/188861/it-bpo-sector-posted-18-7-revenue-growth-in-2014.

[5] loc cit.

[6] For average monthly cost per megabit, Japan charges ₱12, Korea charges ₱20, Thailand charges ₱107, and Singapore charges ₱134. On the other hand, internet in the Philippines costs around ₱1100 per megabit per month.