Philippine ICT Market Size was valued at USD 21.2 Billion in 2022. The ICT market industry is projected to grow from USD 23.7 Billion in 2023 to USD 59.7 Billion by 2032, exhibiting a compound annual growth rate (CAGR) of 12.20% during the forecast period (2024 - 2032). The rise in expenditure on hardware and software services, expanding internet accessibility, governmental efforts, and the surge in demand for digital services are the main market drivers anticipated to propel the ICT market in the Philippines.
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
The increasing accessibility of affordable internet services and the growing adoption of smartphones have driven the demand for digital services and solutions. The Information and Communication Technology (ICT) sector encompasses both the IT and Telecom markets. As per the July 2023 Ookla Speedtest Global Index, the Philippines ranked 89th out of 143 countries in mobile internet speed, with 25.88 Mbps (compared to the global average of 42.35 Mbps), and 49th out of 181 countries in fixed broadband speed, typically higher in Metro Manila, with 91.56 Mbps (compared to the global average of 82.56 Mbps). Investments in IT are on the rise, and significant growth is anticipated in the ICT market over the next five years. The International Trade Administration projects Philippine software and software service sales to reach USD 95 million by 2025. According to the Philippine Statistics Authority (PSA), the country's digital economy surged to approximately $36.5 billion in 2022, contributing 9.4 percent to the Gross Domestic Product (GDP). This marked an 11 percent increase from about $33 billion recorded in 2021, encompassing digital transactions across digital-enabling infrastructure, e-commerce, and digital media/content. Digital-enabling infrastructure emerged as the largest contributor, accounting for around $28 billion or 77.2 percent of the total, reflecting a 7.5 percent rise compared to its 2021 figure. Telecommunication services and professional and business services were the primary contributors.
The Philippine Development Plan (PDP) 2023-2028 emphasizes digital transformation as one of its core themes. In his second State of the Nation Address (SONA), President Marcos instructed all government agencies to digitize essential public services. Initiatives in this direction include the establishment of additional common tower infrastructures to enhance connectivity, digitalization of business registration processes in local governments, integration of online government services into a single platform via the eGov PH Super App, implementation of the national broadband plan to enhance internet and mobile services, and enforcement of the Cloud First Policy promoting cloud computing technology for government administration and public services delivery. Therefore, the market is expanding due to growing internet penetration and growing government initiatives to promote digital transformation. Thus, driving the ICT market revenue.
The Philippine ICT market segmentation, based on Type, includes Hardware, Software, IT Services, and Telecommunication Services. The telecommunication services segment dominated the market mostly. The growth of the telecom industry is primarily attributed to the expanding population and the increasing adoption of mobile phones supporting 3G, 4G, and 5G services nationwide. For instance, PLDT is a fast-tracking network modernization initiative transitioning from copper to fiber infrastructure. Simultaneously, notable advancements in 5G technology have been made. DITO Telecommunity reports deploying over 30,000km of fiber-optic cabling to connect the country's three major islands and erecting more than 5,500 mobile towers, linking over 600 cities and municipalities. These broadband expansions are poised to propel growth in the Philippine ICT market, presenting new opportunities for telecom investments. According to the Ookla Speedtest Global Index, the Philippines ranked 54th in October 2022, boasting a median fixed broadband download speed of 71.70 Mbps. With smartphone penetration on the rise, there is a significant surge in demand for high-speed wireless services.
The Philippine ICT market segmentation, based on the Size of Enterprise, includes Small and Medium Enterprise and Large Enterprise. The small and medium enterprise generated the most income. According to the World Bank (2022), both remittances and significant consumer demand have played pivotal roles in fostering economic growth in the Philippines, with an average annual growth rate of 6.4% from 2010 to 2019. As urbanization in the country continues to rise, entrepreneurs, especially small and medium-sized enterprises (SMEs), have become increasingly crucial to the nation's economic development. As per the 2022 List of Establishments (LE) by the Philippine Statistics Authority (PSA), there were a total of 1,109,684 active business enterprises in the country. Among these, 1,105,143 (99.59%) were categorized as MSMEs, while 4,541 (0.41%) were classified as large enterprises. Micro enterprises constituted the majority at 90.49% (1,004,195 establishments), followed by small enterprises at 8.69% (96,464 establishments) and medium enterprises at 0.40% (4,484 establishments).
Figure 1: Philippine ICT Market, by Size of Enterprise, 2023 & 2032 (USD Billion)
Source: Secondary Research, Primary Research, MRFR Database and Analyst Review
The Philippine ICT market segmentation, based on Industry Vertical, includes BFSI, IT & Telecom, Government, Retail and E-commerce, Manufacturing, Energy and Utilities, and Other Industry Vertical. The BFSI generated the most income. The BFSI category in the Philippines is undergoing rapid evolution, propelled by increasing mobile penetration, the growth of Fintech, and accelerated technology adoption. According to the BSP (Bangko Sentral ng Pilipinas), the banking system's total assets are projected to experience significant growth, increasing from PHP 23.7 trillion in 2021 to PHP 26.5 trillion by the end of 2023. Digital advancements in the BFSI sector have effectively addressed commonly cited barriers to owning a transaction account and have reduced transaction costs. The technological revolution has undoubtedly enhanced the efficiency of financial institutions and facilitated significant improvements in banking operations.
Emerging technologies like artificial intelligence, cloud computing, and the Internet of Things (IoT) are driving innovation in the ICT sector and creating new opportunities for market expansion. A 2020 report by EDBI and Kearney indicates that AI is forecasted to contribute to a 12% increase in the Philippine GDP by 2030, amounting to $92 billion. Additionally, a survey conducted in November 2021 by a global cybersecurity firm among 500 respondents from five ASEAN countries, including the Philippines, revealed that 64% of Filipino participants had increased their cybersecurity budgets for the upcoming year. The survey highlighted that Filipino companies focused on enhancing cybersecurity through various measures, including identity and access management (57%), cloud security (55%), threat detection and correlation systems (42%), fifth-generation (5G) security strategies (42%), and internet of things (IoT) or operational strategies (39%). Furthermore, software-defined area network security is gaining traction in the market due to the growing reliance on cloud storage and solutions.
Leading market players are investing heavily in research and development to expand their product lines, which will help the ICT market grow even more. Market participants are also undertaking a variety of strategic activities to expand their footprint, with important market developments including new product launches, contractual agreements, mergers and acquisitions, higher investments, and collaboration with other organizations. To expand and survive in a more competitive and rising market climate, the ICT industry must offer cost-effective items.
Major players in the ICT market are attempting to increase market demand by investing in research and development operations, including Accenture, Cisco Systems, Globe Telecom, IBM, Dell Technologies, Oracle, Microsoft Corporation, Huawei Technologies, Google, HP, Amazon, and Cognizant Technology Solutions.
October 2022: Globe Telecom deployed 252 5G-ready base stations in Mindanao. This ongoing deployment of 5G networks is expected to generate growth prospects for the company.
April 2022: Microsoft launched its new developments for Windows 11 and 365 tailored for commercial clients in the Philippines, aimed at facilitating the evolution of hybrid work.
| Report Attribute/Metric | Details |
| Market Size 2022 | USD 21.2 Billion |
| Market Size 2023 | USD 23.7 Billion |
| Market Size 2032 | USD 59.7 Billion |
| Compound Annual Growth Rate (CAGR) | 12.20% (2024-2032) |
| Base Year | 2023 |
| Market Forecast Period | 2024-2032 |
| Historical Data | 2019- 2022 |
| Market Forecast Units | Value (USD Billion) |
| Report Coverage | Revenue Forecast, Market Competitive Landscape, Growth Factors, and Trends |
| Segments Covered | Type, Size of Enterprise, Industry Vertical, and Region |
| Countries Covered | Philippines |
| Key Companies Profiled | Accenture, Cisco Systems, Globe Telecom, IBM, Dell Technologies, Oracle, Microsoft Corporation, Huawei Technologies, Google, HP, Amazon, and Cognizant Technology Solutions |
| Key Market Opportunities | ·      The integration of emerging technologies like AI, IoT, and blockchain ·      Enhancing broadband infrastructure and internet connectivity in rural regions |
| Key Market Dynamics | ·      The growing middle class and the young population |
Frequently Asked Questions (FAQ) :
The Philippine ICT market size was valued at USD 23.7 Billion in 2023.
The market is projected to grow at a CAGR of 12.20% during the forecast period, 2024-2032.
The key players in the market are Accenture, Cisco Systems, Globe Telecom, IBM, Dell Technologies, Oracle, Microsoft Corporation, Huawei Technologies, Google, HP, Amazon, and Cognizant Technology Solutions, among others.
Telecommunication Services dominated the market in 2023.
The BFSI had the largest share in the market.
Team Lead - Research she holds an experience of about 6+ years in market research and business consulting, working under the spectrum of information communication technology, telecommunications and semiconductor domains. aarti conceptualizes and implements a scalable business strategy and provides strategic leadership to the clients. her expertise lies in market estimation, competitive intelligence, pipeline analysis, customer assessment, etc.
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