RP seen to reap windfall from BPO firms by 2010

The Philippine government is expected to rake in about $7.3 billion from business process outsourcing of foreign companies by the time President Arroyo’s term expires in 2010, a senior House leader revealed yesterday.

Lone Catanduanes Rep. Joseph Santiago, chairman of the House committee on information and communications technology, based his projection from a BPO industry group. He is supporting the booming BPO industry, a key driver of Philippine economic and employment growth.

“Philippine call centers are projected to have more than 300,000 seats, fully engage up to 506,500 Filipinos and yield as much as $7.3 billion in annual revenues by 2010, according to an industry group,” he disclosed in a statement.

The former National Telecommunications Commission chairman made this disclosure as he also revealed that the San Jose Mercury News, an award-winning US newspaper that exposed the corruption of the Marcos dictatorship in 1986, is now outsourcing customer care to the country.

Santiago said MediaNews Group, one of the largest newspaper companies in the US with 57 dailies across 12 states, has outsourced the customer care of San Jose Mercury News to APAC Customer Services Inc.

APAC, according to the senior lawmaker, “employs some 4,000 college-educated, fluent English-speaking, accent neutral Filipinos in three contact centers in Quezon City and Muntinlupa City.”

The San Jose Mercury News has become the latest US daily to offshore its customer management to Philippine contact centers, Santiago declared.

APAC’s Philippine call hubs will initially provide customer care and back-office solutions to San Jose Mercury News, Contra Costa Times and Oakland Tribune. The services will include fielding inbound customer calls, subscriber retention as well as delivery and billing inquiries.

“We expect MediaNews’decision to start off-shoring some back-office services to the Philippines to drive the group’s competitors to eventually do the same in order to stay economically competitive,” Santiago said.

Santiago noted that newspapers in the US and elsewhere face mounting financial challenges due to rapidly declining readership on account of growing Internet use.

Founded in 1851, San Jose Mercury News is the largest newspaper in San Jose, California and Silicon Valley. With a daily circulation of 230,870, San Jose Mercury News is the 34th largest US paper, according to the Audit Bureau of Circulations.

APAC is a global customer care solutions provider for companies in the healthcare, financial services, publishing, business services, communications, travel and entertainment industries. In publishing alone, APAC has almost 80 newspaper clients from the US.

The McClatchy Co., the third largest US newspaper firm, began outsourcing its customer services to APAC in July 2007.

The company’s top five papers include The Sacramento Bee, The Miami Herald, The Kansas City Star, The Denver Post and The Charlotte Observer, all in the top 50 US dailies, also according to the Audit Bureau of Circulations.

Global BPO providers based in the US have been crediting their Philippine operations as among the most productive worldwide, largely owing to the country’s ample supply of highly cost-effective human resources.