ELECTRONICS INDUSTRY

Brief History
In the 1970s, electronics manufacturers began shifting their production facilities to emerging economies in
pursuit of cost savings, and the Philippines became a desired location for component manufacturing due to its
cost competitiveness, widely spoken English and proximity to large Asian producers of finished goods.
The government also created a framework of incentives for prospective investors, which in 1995 were
transferred under the auspices of the Philippine Economic Zone Authority.
By 1996, the semiconductor and electronics had surpassed agriculture as the countrys largest export earner.

Classification of the Electronics Industry

Semiconductor (Components / Devices)

Control & Instrumentation

Computer Related Products / EDPs

Medical / Industrial Instrumentation

Office Equipment

Automotive Electronics

Consumer Electronics

Aerospace

Telecommunications

Solar / PV

Communication/Radar

Electronics Industry in the Philippines

The electronics sector had the lions share in the countrys exports revenue for March 2016 or sharing
51.1 percent of the total $4.61 billion exports value.

Top 10 export destinations of the countrys electronic goods for March include Hong Kong, United
States of America, China, Japan, Singapore, Germany, Taiwan, South Korea, Thailand, and the
Netherlands.

Obstacles

Local

High Power Cost

High Taxes

Lack of Talents (MS/PhD)

Underdeveloped Infrastructure

Inefficient permitting systems

Limited Supply Chain

Corruption

Low Foreign Direct Investments

Global

Recovering Economies

Low Demand for Legacy Products

Discriminating Consumers

Generous

Incentives

of

Neighboring

Countries

PRODUCT AND TECHNOLOGY HOLISTIC STRATEGY (PATHS)

OBJECTIVES

1. Identify global technology trends in the semiconductor and electronics industry.

2. Based on the semiconductor and electronics technology trends, determine the strategic and specific
products and technologies that the Philippines should focus on in the following sectors:

a) Semiconductor Manufacturing Service (SMS)

b) Electronics Manufacturing Service (EMS)

3. Review the current country factor resources and state-of-the-art technological capabilities and the
business operating environment of the electronics and other industries and the country vis--vis the
new product lines.

4. Given the specific products and technologies to pursue in the SMS and EMS sectors, identify the
necessary and desired industry resources, policies, supply chain and operating environment that will
support the thrust for existing firms to expand into or attract new investors to locate in the Philippines.

5. Formulate a product and technology strategic roadmap to close the gap between the current and the
desired state of the countrys electronic industry identifying specific action programs for marketing,
physical facilities, skills, policy, etc. that are needed to successfully resurrect and grow the Philippine
electronics industry

TELECOMMUNICATIONS INDUSTRY

Brief History

During the 1900s to 1950s the only available form of telecommunication in the Philippines are radios
and telegraphs.

Only after 1950s did the technology for telephone communications were developed.

In the 80s, the market became more accommodating and new telephone companies made their
industry debut. New lines began operating and franchises were allowed nationwide.

In the early 90s, about 2 of every 10 Filipino families have landline phones, with most of the lines
located in Metro Manila.

In 2010, Market penetration reached up to 94% of the population or equal to 86M Pinoys.

Telecommunications Companies in the Philippines

Incorporated

in

Communications,

1991,
Inc.

Smart

(SMART)

is

Globe

Telecom

(GLOBE) which

ownerships are divided by several shares.

currently leading the Philippines' wireless

This

services catering to 45.6 million subscribers

Telecommunications

on its GSM network as of end of year 2010.

Corporation (34%), and public stock (21%)

including

Singapore
(45%),

Ayala

has about 48.4 million mobile subscribers,

nearly 3.5 million broadband customers,
and 858.9 thousand landline subscribers.

Government Policies, Laws and Regulations

August 10, 1963: 3846, An act providing for the regulation of radio stations and radio communications
in the Philippine Islands, and for other purposes.
December 21, 1989: 6849, An act providing for the installation, operation and maintenance of public
telephones in each and every municipality in the Philippines, appropriating funds therefor and for other
purposes.
March 1, 1995: 7925, An act to promote and govern the development of Philippine telecommunications
and the delivery of public telecommunications services.
In order to protect and promote the interest of subscribers/end-users of prepaid telecommunications
services, the National Telecommunications Commission promulgated the regulatory guidelines
regarding the lifespan or expiration of loads the MEMORANDUM CIRCULAR No. 03-07-2009

Four Industry Trends (Global)

1. IT and Telecommunications Convergence

In telecommunications, convergence describes the way distinct services are merged into single
networks and devices and fueled by the Internet, such as smartphones that offer voice calls, web
access, video, productivity applications and more. This makes Internet Protocol (IP) the way
information is relayed across networksand the cloud storage and computing services the massive
deluge of data have spawned, foundational for businesses today.

2. The Rise of the App Economy

In 2015, an estimated 180 billion applications were downloaded globally, notes Wired. But what
originated as an IT catchphrase for smartphone tools has a much deeper meaning for business
productivity. Business intelligence (BI) applications delivered through telecom systems, such as video
conferencing and unified communications, help employees work collaboratively, increase their
efficiency and optimize overall business processes. The potential payoffs are huge. At Call One, where
I serve as executive chairman, data show using collaboration tools can improve business performance
by 72%.

Moreover, not only do unified communications applications bring productivity improvements for mobile
employees, they can also favorably change ways in which all employees communicate as well as
reduce the necessity of travel. And, with the right service partner, these solutions to complex business
needs, can be implemented simply and cost-effectively.

3. Cyber Security Is No Longer Optional

With everything from banking and healthcare to education and government, protecting these digitized

networks and the data they hold is critical. Cybercrime costs the global economy more than $400 billion
annually notes the Center for Strategic and International Studies.

4. Large Telecom Providers Are Shifting Focus away from SMBs

Major telecom companies are focusing on large, multi-national businesses, on the one hand, and
economy-of-scale consumer markets on the other. SMBs are becoming a huge and underserved
market. estimates show this telecommunication market is worth $28 billion globally and growing 20%
annually; Gartner believes the market is experiencing aggressive growth, reaching $244 billon by 2017.