Thursday, June 5, 2008

Davao City seen as emerging ICT hub amid unrests

A recently concluded XMG Global Offshoring Leadership Study revealed that Davao City in the Mindanao Region of the Philippines will be a viable alternative site 3 years from now. This result is part of an ongoing study conducted between January to March 2008, which focuses on forecasting the global demand for offshoring and outsourcing services and the site optimization of emerging cities.

Despite periods of turmoil in the Mindanao Region, outsourcing vendors and captives who participated in the study are very bullish about Davao City primarily due to the area’s larger population of untapped qualified resources compared to Cebu City in the Visayas Region north of Mindanao. The study highlighted that competition in Cebu City is nearing saturation as the talent ramp-up continues.

Among others, the study highlighted the population of Davao City as considerably higher than other Tier-2 offshoring cities globally. In the Philippine context, Davao City’s population is 71% higher than Cebu City, 499% larger than Olongapo-Subic City 333% higher than Angeles-Clark City and 340% larger than Baguio City. The city’s estimated workforce is twice of Cebu, 9 times of Subic and 7 times of Clark and 6 times of Baguio. This has not even taken to account the manpower pool at the nearby cities and provinces of Davao City.

According to the study, Davao City has various educational institutions annually yielding a higher number of IT and BPO qualified graduates than Subic, Clark and Baguio by 689%, 278% and 40% respectively.

Citing previous years 2007 XMG Offshoring Risk and Infrastructure Index Reports, Davao City has been upgraded to a level C2 rating from its previous level D standing as the city emerges as a viable site for captive and outsourcing services. “Compared to other cities in the south, Davao City is very promising and it is seen to be the next generation city that would benefit large captives provided that risk issues are addressed properly”, concludes XMG Researcher Camille Lumbang.

About XMG

Headquartered in Victoria, Canada XMG provides unbiased and highly actionable ICT research, advisory and research-based consulting services to help companies become agile, adaptive and efficient in the use or marketing of information technology and information technology services. XMG’s extensive research and insights help end-users, service providers and captives develop the appropriate strategic response, market penetration strategies and the development of operations excellence.

Completely vendor independent and not aligned with any hardware, software or consulting vendors, XMG ensures an objective fulfillment to solely operate in the best interests of our Customers. Whether Customers are end-user clients, vendors or service providers, the ultimate goal of XMG is to become our Customers long-term trusted ICT Advisor.

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