Call centers to earn $7.3B by year 2010

By Ronnel Domingo - Inquirer

ANNUAL foreign exchange earnings from Philippine call centers are expected to nearly triple within the next five years as the industry expands and becomes more efficient in the daytime use of its work stations, an industry leader said yesterday.

Rainerio Borja, a director of the Contact Center Association of the Philippines, said annual earnings of local call centers would grow to $7.3 billion by 2010, up nearly 300 percent from projected earnings of $2.6 billion this year.

Speaking at the opening of the two-day Call Center Conference and Expo 2006 being held at the Edsa Shangri-La Hotel in Mandaluyong City, Borja said the number of people employed by the industry would likewise increase 182 percent to 506,500 call center agents compared to only 179,000 this year.

The number of work stations or agents’ seats are expected to expand to 300,000 in 2010 from 112,000 at present, according to Borja, who is also the president of People Support, a call center firm.

Citing figures from the industry association and the government, Borja told the annual industry conference that call centers and their employees would pay P8.6 billion ($162 million) in income taxes this year with more money spent on downstream industries, such as office rentals and equipment supplies.

Next gold mine

President Gloria Macapagal-Arroyo has singled out the call center industry as a key potential growth area as Western companies move more of their office functions abroad to take advantage of the huge pool of English-speaking workers in less developed countries, like the Philippines.

“Given these numbers, the value of this industry and its impact on the Philippine economy cannot be understated. We could just be scratching the surface of what could be the next Philippine gold mine,” Borja said.

Call centers basically provide services involving agents making calls to sell products of mostly foreign clients or receiving calls to assist those who had bought their client’s products.

Philippine call centers usually operate at night since their clients and their respective customers are located on the other side of the globe.

Inherent in this setup is the inefficiency of local call centers. “As contact centers grow in terms of the number of seats, the inefficiency of having these not used during day time will increase,” Borja said.

To make their operations more efficient, call centers have started doing non-voice work such as transcriptions, captioning, financial services, back office work and even medical transcription, he said.

Borja said call centers and business process outsourcing (BPO) firms would consolidate in the next few years as the two sectors mature.

Call centers and BPO firms are expanding not only in Metro Manila but also in the cities of Cebu, Iloilo, Bacolod and Dumaguete.

English proficiency

In order to expand, however, the industry should address the problem of a dwindling number of skilled workers, especially those proficient in English, Borja said.

He said local call centers should also learn from the experience of India, whose industry has been hobbled by high employee turnovers and rising wage costs.

Xavier Martin, a director of Alcatel Enterprise Solutions, said in a separate briefing that call center services would increasingly focus on the actual needs of customers, train them to solve their own problems, and provide analyses based on databases built from the interactions of agents and customers over time.

Alcatel yesterday launched its Omnitouch Contact Center Premium Edition that, according to the firm, was easy to use and efficient “just like what the iPod does for music enthusiasts.” With a report from Agence France-Presse