US investors keen on RP’s ICT sector

Trade Undersecretary Gregory Domingo said yesterday that US investors are upbeat about the country’s information and communication technology sector (ICT).

Domingo recently went to the US to promote the local ICT sector and discussed with analysts, call center operators and clients and equity fund representatives ICT prospects in the Philippines.

"There is a strong interest in the Philippine ICT sector specially call centers, business process outsourcing (BPO) and application development," Domingo said.

"The response to the Philippines ICT mission was different from a year ago wherein there was low interest and they did not know the capabilities of Filipinos," he added.

This time around, Domingo said, there was strong interest in the Philippine ICT sector due to three factors which include the promotion done by both the government and the private sector, increasing profit pressure which is forcing US companies to do more outsourcing, and over-exposure to India and the need to diversify operations in other countries.

Among the good news, Domingo said, was the recent decision of Delta Airlines to outsource their call center needs to a Filipino call center operator.

Delta and the Filipino call center provider, which Domingo did not identify, have already signed a contract for 200 seats to handle the airlines’ reservation requirements.

If that is successful, Domingo said, "Delta may expand their call center operations here."

Another client, which outsources its call center operations in the Philippines, Domingo said, is MCI WorldCom and Chevron-Texaco.

"The ICT Group, which is a leading globally integrated supplier of customer relationship management (CRM) solutions is putting up a call center with an initial 120 to 160 seats, but plans to expand to 2,000 to 3,000 set within a 36-month period with multiple site/location," Domingo said.

Domingo also met with two equity funds, namely Warburg Pinkus and Atlantic Partners, which are reportedly both keen on investing in call centers and BPO firms.

"The two equity funds had indicated that they are willing to invest anywhere from $25 million to $30 million on ICT firms with large-scale operations," Domingo said.