In the Philippines, technology is synonymous with mobile technology.
According to Jubert Alberto, Research Manager at IDC Philippines, “The younger generation is entering the workforce, and they have a strong desire to be connected, informed, and entertained. They also tend to have fewer dependents. These factors indicate a growing demand for all things mobile, including devices, services, and applications.” IDC predicts that the Philippines will experience a 22% rise in smartphone spending and a 40% increase in tablet expenditure in 2014, fueled by a positive economic outlook. This will, in turn, boost overall ICT spending. Besides devices, mobility, cloud computing, big data/analytics, and social business—the four pillars of the 3rd platform—will also influence ICT spending as the Philippines embraces them.
IDC notes that companies are adopting these technologies to explore new and effective marketing strategies and connect with their target audiences. The research firm also observes rising ICT demand from small and medium-sized enterprises.
Here are some of IDC’s top predictions for the Philippine ICT industry in 2014:
Mobile data will continue to fuel telecom growth in the Philippines.
While mobile data will outpace mobile voice revenue in other Southeast Asian countries in 2014, it will continue to be the main growth driver in the Philippines. Mobile data is projected to increase by 15%, while voice will peak at 7%.
Karen Rondon-Garcia, Research Manager at IDC Philippines, explains, “The increasing use of mobile computing devices like smartphones, mini notebooks, and tablets will lead to higher mobile data consumption, especially with improved 3G and 4G coverage and mobile operators becoming more innovative with their mobile data pricing.”
The popularity of smartphones and tablets will unlock significant opportunities in the 3rd platform space.
IDC anticipates a 40% growth in tablet shipments to the Philippines in 2014. Notably, Filipinos show a stronger preference for local brands compared to their Asian counterparts. There’s still considerable room for growth in the country’s tablet market.
Jerome Dominguez, Analyst at IDC Philippines, remarks, “The robust growth of tablets and smartphones in the country will create fresh opportunities within the social and mobility aspects of the 3rd platform, which businesses can leverage to their advantage.”
The growing integration of social media and mobility will lead to new consumption patterns.
With the surge in smartphone and tablet adoption in the Philippines, mobile devices have become the primary devices for consumers. This has led to increased integration between social media and mobility.
Cecilia Santos, Analyst at IDC Philippines, states, “In 2014, more organizations will recognize the importance of having a presence on mobile social networks and will seek innovative ways to promote themselves to consumers through app partnerships.”
Mobile apps will have a stronger “Pinoy” identity than ever before.
Recent years have witnessed a surge in Filipino pride. This sentiment drives the demand for apps that have a local flavor and cater to Filipino interests and traditions. This trend is likely to persist in 2014.
Geolocation will create new opportunities for commerce.
Filipinos are increasingly sharing their whereabouts—from restaurants and hangout spots to vacation destinations—on social media. This trend leads IDC to believe that geolocation data will be a game-changer in 2014.
Marketers can use this data to analyze the behavior of existing and potential customers based on the places they visit, their social activities, and interests.
The prevalence of mCommerce and mobile banking will rise in 2014.
While not new to the Philippines, mCommerce and mobile banking are gaining momentum due to the rapid growth of smartphone sales, expanding 3G and LTE networks, and increasingly affordable mobile data services. These factors are driving demand for applications that enable mobile users to shop, book tickets, hail taxis, and access content, among other things.
The increase in smartphone usage also compels banks to offer mobile banking services to meet customer demand for convenience.
Rondon-Garcia adds, “Mobile banking is the most effective way for banks to reach a wider customer base, including those without access to traditional banking facilities, especially in rural areas.”
“Moreover, as online shopping gains popularity, whether on smartphones or personal computers, mobile wallets provided by mobile operators offer customers a secure payment method for online purchases even without credit cards, PayPal, or bank accounts.”
More technology players will emerge in “next wave cities.”
As technology-driven businesses expand beyond Metro Manila, IDC predicts a surge in IT spending in other cities across the country: Sta. Rosa in Laguna, Bacolod, Iloilo, Metro Cavite (Bacoor, Imus, and Dasmariñas), Lipa in Batangas, Cagayan de Oro, Malolos in Bulacan, Baguio, and Dumaguete.