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Philippine Daily Inquirer First Posted 00:18:00 02/05/2010 Filed Under: Infotech, business process outsourcing (BPO), Computing & Information Technology, Internet, Telecommunications Services

DAVAO CITY Four days into her tour of the countrys cyber corridor, President Gloria Macapagal-Arroyo said she would be turning over to the next administration a call center industry that had become the second biggest global earner and one capable of elevating the nation to First World status. The next leadership, she said, should intensify programs that would educate the young on the use of computers and the Internet for the next generation of BPO workers. The business process outsourcing (BPO) sector would be a major key for the Philippines to finally join the ranks of developed countries in two decades, Ms Arroyo Thursday said during a visit to a call center here. Much work remains to be done but I am determined to turn over to the new government a new Philippines ready for the new challenge of bringing the nation on the verge of (becoming) First World in 20 years, she said. Early in her presidency, the sector merely raked in some $20 million in annual earnings, Ms Arroyo recalled. Today, the industry posts total earnings of about $7 billion a year, second only to the $9 billion annual income of BPO operations in India, the President reported. The 90 million Filipinos have challenged Indias one billion (population) for BPO supremacy, Ms Arroyo told the gathering at Concentrix Institute on JP Laurel Avenue

Its official: PH bests India as No. 1 in BPO

Philippine Daily Inquirer Posted date: December 04, 2010

MANILA, PhilippinesAfter challenging India for the top position for several years, the Philippines is now the world leader in business support functions like shares services and business process outsourcing, according to the latest reports and trends analyses. In fact, the country overtook India in these categories last year, according to IBMs latest Global Locations Trend Annual Report, released recently in New York. India now ranks No. 2, the first time it was not in the leading position for these activities, according to the IBM report, launched in October but made available online last month. The Philippines has taken over the lead in the global ranking from India, the report said. The IBM report said the Philippines offered a similarly attractive business environment for international business support functions as India. Unlike Indias BPO hot spots, however, labor costs here have not increased as much. Revenue: $5.7B in 2010 On Thursday, the Contract Center Association of the Philippines said the country had become the call center of the

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world, with around 350,000 Filipinos working in call centers against Indias 330,000-strong workforce. Revenues from the countrys call center industry are also expected to reach $5.7 billion this year, higher than Indias $5.5 billion, the CCAP said. The call center industry, which provides so-called voice services like customer support and sales, is part of the BPO industry. Call centers make up 70 percent of the BPO industry in the Philippines. Currently, there are 600,000 Filipinos employed in the countrys BPO industry, according to the Business Processing Association of the Philippines. India is here In yet another sign of the Philippines BPO dominance, Tata Consultancy Services, the information technology services, business solutions and outsourcing arm of Indias giant Tata Group, opened its first BPO center in Southeast Asia at the Bonifacio Global City in Taguig on Thursday. We believe that the Philippines has a very high quality of talent that can represent the company before our Asia-Pacific customers and our global customers, said Vish Iyer, head for the Asia-Pacific region for Tata Consultancy Services. Iyer also said Tata chose the Philippines because it wants to be here to see the Philippine BPO industry grow from its current $9 billion [in annual revenues] to the projected $25 billion in 2016. The BPO center that Tata Consultancy inaugurated will have 400 seats, and a target of three clients, including Citibank. Abid Ali Z. Neemuchwala, vice president and global head for business process services and process excellence, said the company expects to more than double this to 1,000 seats and a target of five clients two years from now. The firm generated revenues of about $6 billion last year. Support for BPO industry In November, Senator Miriam Defensor-Santiago said she would file a measure to jump-start legislative support for the BPO industry, especially its workers and urged other legislators to formulate laws supporting this booming sunshine industry. According to the International Labor Organization, the BPO industry may be broadly divided into voice services such as call and contact centers, and non-voice or back office services, like finance and accounting, data processing and management, and human resource development. An ILO report released last July noted that Filipino BPO employees were earning 53 percent more than workers of the same age in other industries. The study pegged the average monthly salary of local BPO employees at P16,928, with men earning 13 percent more than women. Local BPO employees also work 44.7 hours per week on the average, with overtime work averages of 1.12 hours per week. Night work The study also found that 42.6 percent of BPO employees in the country work at night, and that respondents have reported sleep disorders, fatigue, eye strain and body pains. Following India in IBMs ranking of BPO leaders were the United States, Poland, China, Britain, Columbia, Costa Rica, Fiji, Ireland, South Africa, Sri Lanka, Hungary, Australia, Egypt, Chile, France, Canada, France, Singapore and the

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Netherlands. The IBM report said Sri Lanka was another Asian country that had succeeded in positioning itself as an alternative to India. Reports from Cynthia D. Balana and Lawrence de Guzman, Inquirer Research

Gartner: India still No. 1 BPO destination

Posted on 21 Dec 2010 at 11:45am

If IBMs Global Trends report put the Philippine ahead of powerhouse India in the outsourcing leader-board, a new yearend report from research firm Gartner contradicted this it as ranked the sub-continent as the top BPO destination in the world. The Philippines, on the other hand, was downgraded from good to fair in the global and legal maturity category. Gartner identified the Top 30 countries for globally sourced activities in 2010-11, each one rated according to 10 criteria, with India topping the list. It found that eight new countries have made their debut in the Top 30. The leading emerging offshore locations evaluated by Gartner in the Asia Pacific region are (in alphabetical order): Bangladesh, China, India, Indonesia, Malaysia, the Philippines, Sri Lanka, Thailand and Vietnam. Clients continue to seek a portfolio of offshore countries, and with India again experiencing increasing labor costs and attrition, this is creating opportunities for other offshore locations to target the services needs of more-mature Asian clients, said Ian Marriott research vice president at Gartner. Gartner elected to focus on emerging countries this year due to the dynamic changes taking place as they move towards developed country status. Gartner excluded the mature countries of Australia, New Zealand, and Singapore this year because their maturity has led to little year on year change to their rating. The analyst firm also included two new countries to this years analysis Bangladesh and Sri Lanka. Sri Lanka was last assessed in 2007-2008, while Gartner assessed Bangladeshs offshore rating for the first time. During the past 12 months, there has been significant activity in many countries to consolidate or grow their positions as leading locations for offshore services. Gartner has seen interest and steps taken by governments to improve their attractiveness to foreign companies setting up offshore operations in their countries. These measures include initiatives to improve the English language capability in the education system, setting up policies to better protect data, intellectual property (IP) and privacy, and improving the countrys infrastructure. Enforcement of laws with regard to data/IP and privacy protection, and legal maturity continues to be an adoption barrier for using a number of low cost countries despite country governments taking action to improve the policies and regulations in these areas, said Marriott. Ratings of various countries as an offshore location: Bangladesh: It rated very good in costs.

China: Improved its scores for political and economic environment from good to very good, and culture compatibility from fair to good. Contributing to the increased rating for China is its rising global political and economic leverage, especially during the recent global economic crisis. China held a steady positive growth rate spurred by the $583.9 billion stimulus package in 2009. The Shanghai 2010 World Expo has helped to increase cultural awareness within China. India: India is already the most successful country amongst the offshore locations. It continues to score very well across all 10 criteria. With the rising Rupee, its cost competitiveness is being challenged, but this is compensated by its strength in other areas. Indonesia: Improved costs from very good to excellent, and labor pool from poor to fair. Based on several surveys that Gartner analyzed, Indonesia continues to offer amongst the cheapest labor costs for IT and business process skills in the region. Indonesia has consistently increased its global competitiveness in its IT skills, lowered its unemployment rate and increased the number of qualified engineers. As a result, it is also attracting an increasing number of vendors providing offshore services out of Indonesia. Malaysia: Improved its government support and infrastructure from good to very good. In Malaysias 2010 budget, the government introduced green IT initiatives to encourage green technology adoption. The Malaysian government is also investing in high speed broadband (HSBB), and 1.3 million homes and premises are expected to access HSBB services by 2012. It is becoming a regional center of excellence for service desk, remote infrastructure monitoring and support as well as shared services center for logistics. Philippines: Gartners scores for the Philippines remain largely unchanged, although global and legal maturity slipped back from good to fair. Gartner continues to see foreign companies being attracted to the countrys young, experienced labor pool specializing in contact centers and finance and accounting (F&A) business process outsourcing (BPO), complemented by good language and cultural compatibility with western economies. Sri Lanka: Gartner previously rated Sri Lanka in the Top 30 locations in 2007. It has improved its scoring for government support, infrastructure and political and economic environment. Thailand: Thailands rating has not significantly changed across the 10 criteria, although Gartner has seen Thailands desire to improve its policies around the areas of data/IP/security and privacy and education. Vietnam: Improved its labor pool and Culture compatibility ratings from fair to good, but the cost rating slipped back from excellent to very good. Vietnams labor pool continues to be attractive due to the size of its young workforce. The Vietnamese government has created a priority list in 2010 to train 40 percent of its workforce in selected fields including IT. From a culture compatibility improvement perspective, Vietnam now has a sizeable expatriate community from Japan, South Korea, Taiwan, Malaysia, Singapore, Thailand and France.

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Even respected columnists have taken these news reports at face value (e.g. Cielito Habito, No Free Lunch PDI, December 7, 2010).

Go to the BSP web site: http://www.bsp.gov.ph Click Statistics Monetary, External, and Financial Statistics Key Statistical Indicators Balance of Payments Latest HTML Balance of Payments 1999-December 2011 Services Note: For definition of components of services account, you can go to the BSP Advanced Search Engine and search for the definition and components of the various services. Go to http://www.rbi.org.in Click Database, Current Statistics, Database, Quarterly, Balance of Payments Special Data Dissemination Standards Balance of Payments January-March 2011 Statement II: Indias Overall Balance of Payments Annual (US $Mn) See navigation bar below Go to A.II.a services, v. miscellaneous Software Services BOP Earlier Format 1 USD BOP (2011-2012) July-December 2011