SOFTWARE DEVELOPMENT Basic Industry Information
Market by Revenue USD Billion, 2016
Software development is one of the more established sub-sectors of the Philippine IT and IT-Enabled Services industry. With more than three decades of experience, it has built a reputation for quality of work and efficiency of service. From technology services to business consulting, local players have proven that they are capable of delivering services and products that meet stiffest global standards. Many companies operating in the country are certified in ISO/CMMI.
Others Systems Integration Testing Support Infrastructure Applications Devt
17% 5% 8% 22% 20% 28% 0
According to Everest Research, the Philippines is one of most favorable locations for IT-Applications Development Management, offering cost savings and a large entry-level talent pool with a significant breadth and depth of skills.
ITO revenue industry growth drew largely from large enterprises with 85.7 percent of total revenues. ITO Firm Revenue By Size* Mid 12.7
Major Players Large 85.7
The thriving industry has already attracted some of the biggest names in the global software arena:
*Large.1000, Mid 100-1000, Small ,100 Employees
Major Players FOREIGN Accenture Genpact (Headstrong) Capgemini Netsuite HP Misys RCG
IBM UST Global
LOCAL Pointwest Existglobal
Oracle Fujitsu NEC Safeway SAP
Orange & Bronze AWS Gurango Software Alliance Software BlastAsia
There are more than 400 software companies operating in the Philippines. In total, there are about 200,000 IT and software personnel in the Philippines, of which about 85,000 cater to the export market.
In terms of services offered, the industry drew most revenues from Banking Financial Services and Insurance (BFSI) with 21 percent. ITO Revenue By Service Type Retail 14% Tech 16% Manufacturing 8% BFSI 21%
Philippine Software Industry Association (PSIA) www.psia.org.ph
The USA remains the top export market for local software companies with about 53 percent share of revenues. AsiaPacific (APAC) had 24 percent, and Europe, Middle East and Africa (EMEA) with 18 percent.
Industry Performance Customer Demand 2016
The IT Outsourcing industry is registered US$ 2.97 billion in revenue in 2016 with a total employment of 123,240.
PSIA reported that of the Philippine software revenue, Applications Development made up 28 percent followed by software support services with 22percent and infrastructure support at 20 percent.
Rest of World 5%
North Amercia 53%
1|P a g e Condensed from IT-BPM Roadmap 2022: Accelerate PH, Future Ready. IBPAP. All rights Reserved As of December 2017
SOFTWARE DEVELOPMENT Services Offered The workforce skills range from the most current and widely-used technologies such as C/C++, HTML, XML, PHP, Action script Java J SE J EE, JSP, EJB, C #, Visual Basic, VB.NET, ASP.NET, AJAX, RPG/400, FILENET, COBOL, CICS, WSAD, Rational, CSP, Symbian, WML, J2ME, OMA, WURFL, Sharepoint, DRMCIMD2, UCP, Linux, Ruby on Rails, MySQL, Eclipse, Apache, SAS Natural, SQL Reports, Crystal, Easytrieve, Oracle BI EE.
In terms of FTE growth, the sector is expected to grow in the next six years, increasing revenue at a compound annual growth rate (CAGR) of ~11.4 percent from US$ 3.0 billion in 2016 to an estimated US$ 5.7 billion in 2012.
Productivity improved 23 percent from a little over US$16,000 in annual revenue per employee to almost US$20,000. Yearly Revenue Per FTE USD '000
Technology services covering the following applications:
IT Operations Management Application Testing Application Maintenance & Production Support Application Development ERP Implementation Product Quality Assurance Software as a Service Embedded Systems, Firmware Development
Domain Expertise - Banking and Finance, Insurance, Government, Health, Telecommunications, Manufacturing, Education, Real Estate, Retail, Supply Chain, CRM, Wireless & Mobile, Media & Publishing, Aviation, Architecture & Engineering, Logistics, Hospitality, GIS, and Business Analytics
Roadmap 2022 identifies both traditional and platform plays as keys to growth. It further states that large ITOs to expand delivery from PHL, focusing on full stack techbased digital solutions while small players focus on applications development, managed services with new markets in Asia. Future Growth (2016-2022) By Size of Firm 12-16%
Platform - Windows, Linux, Unix, MVS, OS400, Windows Mobile, Android and iOS Development Environment - Java, .Net, COBOL, Visual Basic, RPG/400, C/C++, Oracle, Open Source Technologies Database - Oracle, Microsoft SQL, MySQL, Sybase, IBM DB2 Vision, Goals, Target and Milestones
The sector is expected to grow in the next six years, increasing revenue at a compound annual growth rate (CAGR) of ~11.4 percent from US$ 3.0 billion in 2016 to an estimated US$ 5.7 billion in 2012. Revenue Forecast USD Billon
Employment Forecast '000
9.0% CAGR 2016-2022
Large. >1000, Mid 100-1000, Small <100 Employees
Philippine Advantage The Philippines remains one of the most—and close to the most—cost-competitive locations in the world for information technology outsourcing (ITO). The country offers tremendous potential for growth to investors and businessmen who are looking for more bang for their buck will find the Philippines as a necessary stop for their business operations. The labor cost is competitive and the quality of work is unassailable. Australia Malaysia Philippines Vietnam India China Poland South Africa Brazil Mexico Canada
USD 66,985 USD 23,292 USD 15,476 USD 13,200 USD 12,593 USD 24,104 USD 21,935 USD 21,938 USD 32,031 USD 17,445 USD 57,769
2|P a g e Condensed from IT-BPM Roadmap 2022: Accelerate PH, Future Ready. IBPAP. All rights Reserved As of December 2017