IT to generate 5.8 million new jobs by 2013: IDC

Information technology will be an employment machine, generating 5.8 million new jobs in the coming four years, according to International Data Corporation (IDC) research released Sunday.

IDC predicts that the IT industry will be an engine powering economies out of economic doldrums, creating more that 75,000 new businesses in the next four years and adding jobs at a rate of 3 percent annually.

"Countries that foster innovation and invest in infrastructure, education and skills development for their citizens will have a major competitive advantage in the global marketplace," said Microsoft chief executive Steve Ballmer.

"In this fundamental economic reset, innovative technologies will play a vital role in driving productivity gains and enabling the creation of new local businesses and highly skilled jobs that fuel economic recovery and support sustainable economic growth."

US software colossus Microsoft sponsored the IDC research into the impact of IT in 52 countries that represent 98 percent of the global IT spending.

"IT spending growth is a good sign as we come out of the recession," Microsoft Corporate Affairs communications manager Scott Selby told AFP.

Employment growth in IT related jobs will be three times that of overall job growth in what Selby said is a "good driver of economic growth."

While the world has been in the gripes of a recession, it has also been in the midst of a "technology renaissance" flush with advances in software, devices, and Internet-based services, according to IDC.

IDC expects IT spending in the countries studied to grow at slightly more than three percent annually, three times as fast as the gross domestic products between now and the year 2013.

In what is good news for software powerhouse Microsoft, spending on software is predicted to grow faster than overall IT spending, rising 4.8 percent annually.

"Software is a driving force behind this IT growth," Selby said. "IT allows us to do more with less."

New technologies are also ushering in a new "cloud computing" paradigm in which applications are provided online as services instead of as software bought and installed on home or office machines, according to IDC.

Money saved by using software as needed "in the cloud" instead of buying, maintaining, and updating applications will likely be devoted to bringing new products or services to market faster and cheaper, according to Selby.

IDC estimates that cloud services could add 800 billion dollars in net new business revenues between the end of 2009 and the end of 2013.

"Over the past 20 years, we've seen transformative power in how investments in IT innovations foster economic growth," said Robert D. Atkinson, founder of the Information Technology and Innovation Foundation in Washington, D.C.

"Continued innovation and investment in information technology will help jump-start recovery from the current recession and will significantly contribute to the growth of employment and new businesses."

Emerging markets will reap the greatest economic gains from IT, according to Selby.

"Emerging markets are really going to take advantage of IT for years to come," Selby said.

"One reason is they will be able to leapfrog and enjoy benefits of innovations like cloud computing much more quickly."

Microsoft played up the prime role its software is playing in IT systems worldwide.

Purpose-driven competition among telcos needed

WHEN TELECOMS promise to create a limitless world for Filipinos, to what extent should consumers believe?

Recently, the country’s telecom providers have been aggressively competing to win consumers in the “unlimited” market. Indeed, their new unlimited offers are reflections of the new vigor of the Philippine telecommunications industry. But are local telecoms able to help Filipinos break new grounds and embrace truly unlimited opportunities?

High but not perfect

In economics, perfect competition is defined as the scenario wherein firms end up taking the prevailing market price. Although competition in the industry is deemed high and intense, telcos still maintain some degree of power to set their own prices.

In the same breath, however, telcos must always keep in mind that there exist competitors who can take away customers from them and that new players may freely enter the industry at any time. As a result, local telecoms are always wary about the prices they charge and the kind of services and products they are offer. As such, the local telecoms industry is often described as monopolistically competitive—that is, even if the industry is not working within a perfectly competitive setting, it is still considered highly competitive.

In the Philippines, those that are aggressively competing against each other are the Philippine Long Distance Telephone Co. (PLDT), Globe Telecom, Digitel Mobile Philippines (Sun Cellular) and Bayan Telecommunications. While there are a host of smaller players operating throughout the country, these few are considered the telecom industry’s leaders.

Defining telecom’s competitive edge

Through the years, each of these four major telcos has carved its presence in the market. The past five years saw how each company tried to locate its niche in the market.

Faced with a cutthroat competition, telcos introduced new products and services at affordable prices. The industry has experienced new heights in wireless landline services, broadband, and mobile text and call services.

For example, Bayan became one of the pioneers in wireless landline services in the country. By offering its products such as Bayan Span and Bayan Wireless Landline, Bayan experienced a major turnaround in part due to the success of its wireless landline services. This success has prompted rivals PLDT, Globe, and Sun Cellular to offer their own wireless landline services as well.

PLDT launched its Landline PLUS by means of intensive advertising campaigns equipped with big names in the entertainment industry—Marian Rivera and Edu Manzano. Sun Cellular also utilized the same strategy by enlisting superstar Judy Ann Santos to promote its wireless landline, while Globe recently unveiled its mobile-landline unlimited services referred to as Duo.

The market for broadband services has also become a new arena for competition among telcos. After PLDT tested the waters for wireless broadband services (via Smart Bro), Globe and Sun Cellular were also quick to offer the same service. By a strategic re-branding of its wireless broadband product into the brand name, Tattoo, Globe has joined PLDT and Smart as a growing provider of wireless internet services. For its part, Bayan was also quick to position itself as a reliable partner for wired broadband services by its Satisfaction Guaranteed and “Bayan DSL, Ang Dali” campaign.

But if one will have to select the best determinant of heightened competition among telecoms, it would be the industry’s fascination over unlimited offers for texts and calls.

Sun Cellular pioneered the introduction of cheaper packages that include unlimited texting and calling. Sun Cellular offered a package, giving away intra and inter network call and text services, for as low as P10 only. Globe also brought into the market a series of unlimited offers such as Unlitxt, Sulitxt and Unlicalls Night—offers that provided unlimited texting and calling services for as low as P15. For its part, Smart initiated its Smart Talk promo that allows subscribers to host unlimited intra-network calls for only five days.

Some industry players have also issued other pioneering products and services. In 2008, Smart launched the Plug ‘N Talk USB communication device which allows those outside the Philippines to communicate from an Internet-connected computer to any Philippine number. Globe has also launched iPhone 3G and Blackberry. These new products feature 3rd generation wireless technology, GPS mapping and Wi-Fi capability.

The need for a purpose-driven competition

To a certain extent, the description that the telecommunications industry is highly competitive does hold some water. Through the years, cheap telco products and services have flooded the market.

Since the start of the Ramos administration’s deregulation efforts in 1993, the Philippines has slowly become a global leader in the use of short messaging services or SMS. Anecdotal evidence suggests that prior to deregulation, it could take almost one year for a customer to get a telephone line.

Now, some telecoms even promise to connect broadband or landline services within forty hours. While it’s true that consumers are probably better off in terms of quality of service and reasonability of the prices of telecom products today, there remain some missing blocks that, when completed, can pave the way for more purpose-driven competition.

The Philippines is still home to a low broadband penetration rate relative to its Southeast Asian counterparts such as Malaysia and Thailand. Coupled with that is the fact the country is also one of the developing countries with inadequate telecommunication facilities. Most of the reliable facilities are confined in the Metro Manila and the urbanized cities of Luzon.

Still, a lot of areas across the archipelago are not able to experience seamless mobile and broadband connections. These circumstances highlight the need for the industry to invest in and develop facilities that will sufficiently respond to the demand of potential consumers in the countryside.

Indeed, more Filipinos are able to access telecom products and services than the time when the industry was still under a monopoly. However, it must be emphasized that the broadband packages in the Philippines are more expensive than the packages available for our neighbors.

A 3-mbps unlimited plan in Singapore only costs around P800 while our 1-mbps packages are priced not less than P1000. While the industry can be credited for creating a series of packages for consumers, firms must be able to deal with providing faster connections at reasonable prices. For instance, except for Sky Broadband’s 12-mbps offer, most of the firms are only able to offer a maximum of packages with a speed of 2-3 mbps. To expand access and intensify their penetration of the market, telecoms should be more creative in designing cheaper yet reliable packages.

The Asian Development Bank also reported that telecoms are not yet maximizing e-commerce in the country. The support for small and medium entrepreneurs (SMEs) in the country is still not that strong. Sure, PLDT has its SME nation program and Globe has its Globe Business products. But the fact remains that majority of SMEs are still outside the scope of the SME support services provided by local telecoms. Electronic payment system, for instance, is still an unexplored area for many local companies because of the complexity of the process in utilizing the said service.

Connecting the 7,107 islands of the country is really a tremendous challenge for telecom operators. However, with the presence of strong competitors and discerning consumers, telecoms can’t afford to create a room for complacency. Beyond the battle for promotions through million-peso worth of multi-media advertising, telecoms should gear up for a new phase of the competition. After all, millions of those outside Manila and other urban centers are still waiting for improved communication infrastructures to pave the way for a more reliable connectivity.

Not only will industry reforms spell growth for telecoms, these changes will also mean maximization of the industry’s potential to become a pillar of the nation’s development. Having a purpose-driven competition in the industry is a step closer to the industry’s promise of unleashing unlimited opportunities for Filipinos.

EU starts turning out old-fashioned light bulbs

Tuesday marks the beginning of the end for traditional, energy-guzzling light bulbs throughout Europe, with the 100-watt and frosted bulbs the first to go.

It is all part of a three-year scheme to rid the whole of the European Union of the traditional incandescent bulbs first put on the market by Thomas Edison in 1879.

Some consumers have been stockpiling the old-style versions, aware that the more energy-efficient long-life fluorescent or halogen lamps cost more to buy.

And while shops will be allowed to sell off their remaining stocks, as of Tuesday there will be no new orders of non-transparent frosted bulbs -- deemed particularly inefficient -- or the standard clear 100-watt bulbs.

The less powerful clear bulbs will be progressively banned until all traditional lights disappear from shops in 2012.

It's all part of the EU's bigger plan to cut greenhouse gas emissions 20 percent by 2020.

The new bulbs, such as compact florescent lights (CFL) can save up to 80 percent of the energy used by the worst old-style lights in homes.

They are also described as lasting several times longer than the bulbs they will replace.

So even though the new bulbs cost more, the European Commission stresses that consumers will save money: between 25 to 50 euros a year, depending on the size of the household, the EU executive claims.

"Although this move has been welcome by many, some consumers are still uncomfortable with the idea of giving up their familiar light bulbs in favour of modern and more efficient alternatives," EU Energy Commissioner Andris Piebalgs wrote on his blog.

"Much like the car and the telephone caught on with everyone, I have no doubt that once Europeans start using the modern alternatives to the inefficient light bulbs, they will start to enjoy the advantages they have to offer," he added.

But consumer groups have already started adding health fears to existing concerns over pricing.

For while the European Consumers' Association the BEUC has welcomed the phasing out of incandescent light bulbs, it has expressed concern about the high mercury content of their replacements.

The EU plan also "falls short of the needs of some consumers who need to use the old-style light bulbs for health-related reasons such as light sensitivity," the BEUC added.

The Commission argues that the new bulbs will cut mercury emissions from power stations.

But it has also published guidelines for dealing with mercury spills from broken bulbs: avoid skin contact and do not use a vacuum cleaner to clear up.

And so far as the needs of light-sensitive people are concerned, the EU executive suggests they use "improved incandescent bulbs with halogen technology".

Judging from the orders received from Osram, one of the biggest light makers in Europe, people have already started buying more of the new generation bulbs.

However Alice Pirgov, an expert at the German consumer research institute (GfK) speaks of panic buying there as "the classic light bulb is associated with tradition."

The European Commission on Monday did not rule out the possibility of the old 100-watt bulbs becoming something of a collector's item and changing hands at inflated prices.

Siemens offers ‘tailor-fitted’ solutions for RP industries

AS three of the country’s important industry in areas of manufacturing, utility, and transportation brace for challenges amid economic slowdown and domestic population growth, the local subsidiary of Europe’s engineering conglomerate giant Siemens Inc. has vowed to provide tailor-fitted or comprehensive industry solutions for Philippine companies.

“We are determined to become a helping partner as the Philippines moves forward to achieving greater success in those major industries,” said Adrian Wood, president and chief executive officer of Siemens Inc. Philippines.

Wood expressed confidence that exporting companies dealing in industrial processes today are more optimistic to integrate automation and solutions to maximize their efficiency and production.

Filipino food exporters, for instance, are enjoying a good following and demand for marine and agricultural products in Taiwan.

According to Antonio Basilio, resident representative of Manila Economic and Cultural Office, the country’s exports to Taiwan improved by 25 percent to $10.1 million from $8 million last year.

The anticipation for exports improvement is further extended by economists to manufacturing electronic raw materials.

Wood said “that’s why for every manufacturing process, we assure clients’ operations are streamlined and optimized.”

“More efficient production processes mean higher production volume which translates to cheaper goods. Siemens is committed to provide the modernization needs of the Philippines’ industry sector, which will pave the way for the country’s progress as well,” he said.

Among corporations that utilized the Siemens’s patented factory automation solutions include Monde M.Y. San Corp., San Miguel Corp., Asia Brewery Inc., United Laboratories, Holcim and Lafarge.

Under Siemens’s affiliated companies which comprised of Siemens Power Operations Inc. and Osram Philippines Ltd. Corp., utility needs of residential, industrial and agricultural communities have been empowered.

Its water treatment systems have provide relief to people with previous struggles in sanitation and distribution, while its lighting solutions promotes both cost and energy efficiencies for energy-centered types of businesses.

“We are committed to continue bringing innovation that would impact the lives of the next generation of Filipinos,” Wood said.

Siemens’s key businesses in the Philippines include automation and control, industrial solutions, information technology products and services, medical solutions, power (generation, transmission and distribution), Siemen’s IT solutions and services, and transportation.

Filipino CIOs learn from each other

As the global economic crisis slowly unravels, local chief information officers (CIOs) continue to look for strategies that will ensure business continuity and prepare them for the eventual upturn.

However, not all strategies could work and some CIOs still lack the maturity to implement strategies either because they are not familiar with effective industry practices or even with simple yet novel ideas.

“The best way to learn new techniques is to bring them together and share experiences so CIOs know what works and how these can be implemented in their organizations,” according to Accenture Philippines country managing director Beth Lui.

Speaking before a CIO workshop conducted by Accenture, Lui said CIOs are inclined to learn more from others’ experiences to enable their own companies to effectively maintain business continuity.

She said CIOs are able to exchange ideas and ask relevant questions pertaining to business operations, citing that as the economy turns, these companies would want to deliver faster and better services without breaking their budgets.

“The general consensus is that companies have smaller budgets, especially for information technology but they still expect to deliver their services better. They’ll learn if they find out how others did it,” Lui said.

Accenture has been conducting CIO workshops in other countries bringing together executives from different industries specifically to showcase key findings on how companies leverage in IT for specific business requirements.

The Philippine CIO workshop would be the first the company is conducting locally. About 40 are expected to attend.

Accenture CIO Organization Executive Director Kenneth Corless said the event will highlight different usage models for new technologies.

Among the topics include network security, data consolidation, return on IT investments, strategic IT cost reduction, and even new technologies such as virtualization and “green” technologies.

In the workshop, Accenture will be used as one of the models of a large company that successfully managed their IT needs while reducing costs.

“What’s important here is that they have a venue for peer collaboration and to share these experiences. A large company may learn new things from a small company that is using new ways to operate efficiently. People are hungry for new ideas,” Corless said.