Medical, legal transcription fastest-growing...– BSP study

Bangko Sentral ng Pilipinas (BSP) Study

Medical and legal transcription posted the highest growth in revenue among all the sub-sectors in the business process outsourcing (BPO) industry at 97 percent in 2005.

This was shown in the result of the 2005 baseline study of the Bangko Sentral ng Pilipinas (BSP) on the economic contribution of information technology (IT)-enabled services in the country.

BPO industry comprises contact or call centers, medical and legal transcription, animation, software and other BPOs that include management consultancy, hardware consultancy, data processing, financial and accounting services and engineering services.

The industry’s revenue in 2005 totaled to about P109.9 billion (US$ 2 billion), which is higher than year-ago’s P74.2 billion (US$ 1.3 billion), the survey said.

Among the sub-sectors, contact centers had the highest revenue share at 49.4 percent or P54.3 billion followed by other BPOs, 29.3 percent, P32.2 billion; software development, 20 percent, P21.9 billion; animation, .9 percent, P939.1 million; and medical and legal transcription, .4 percent, P466.2 million.

Medical transcription registered the highest annual growth at 97 percent followed by contact centers, 65 percent; software development, 40.8 percent; animation, 35.3 percent; and other BPOs, 30.5 percent.

“All sub-sectors posted strong expansion in revenue, averaging 48.2 percent in 2005,” BSP Governor Amando Tetangco Jr. said in a statement.

The survey also showed that most of the revenue of the industry came from exports at 69.5 percent while the remaining portion were sourced locally.

Income of the industry from abroad totaled to P76.5 billion (US$ 1.4 billion) in 2005, a significant jump from year-ago’s P49.8 billion (US$ 888.2 million).

“Contact centers and the medical and legal transcription sub-sectors were highly dependent on foreign earning, with more than 95 percent of their revenue coming from exports,” Tetangco said.

Most of the BPO services catered to the US market that had a share of 86 percent in total export revenue followed by Europe particularly United Kingdom and Germany, 7.1 percent; Japan, 3.2 percent; other Asian countries, 2.4 percent; and Australia and New Zealand, 1.3 percent.

Asian countries being catered by BPO companies in the Philippines are India, China, Hongkong, Indonesia, Malaysia, Singapore, Taiwan, Thailand, Vietnam, United Arab Emirates (UAE) and Saudi Arabia.

Total equity investments that the industry reported in 2005 amounted to P27.1 billion or about US$ 491.7 million, 66.9 percent of which or about P18.1 billion or US$ 328.8 million were foreign equity.

Total employment in the industry jumped by 46.1 percent in 2005 to 138,002 from year-ago’s 94,488.

Contact centers had the highest employment at 96,246 followed by other BPOs, 20,278; software development, 17,829; animation, 1,864; and medical transcription, 1,785.

Total compensation in the industry in 2005 reached 42.4 billion from year-ago’s P26.4 billion.

“The value added ratio of the industry was estimated to have risen from 56.0 percent in 2004 to 63.0 percent in 2005, indicating the growing contribution of the industry to the country’s Gross Domestic Product (GDP),” Tetangco said.

The central bank chief said that for every P1.00 output generated by the industry during the year the study was conducted the value added to the country’s GDP was P0.63.

The study covered 317 company-members of the different information and communications (ICT) organizations registered with the Department of Trade and Industry (DTI), Philippine Economic Zone Authority (PEZA), and Board of Investments (BOI) but only 203 companies responded, which resulted in a 64-percent response rate.

Tetangco said the BSP, along with other government agencies, will institutionalize the regular conduct of the survey to encourage greater participation of BPO companies for future studies. (PNA)


source: http://biz.balita.ph/html/article.php?story=20070607111732710