Global semiconductor giant Intel sees Southeast Asia as a major engine of growth in the next three to five years as next-generation Intel-enabled personal computers (PCs), mobile phones and tablets are rolled out to more consumers and businesses.
The Philippines, in particular, is seen offering a vast market for Intel from the angle of PC consumer penetration, given that only 16-17 percent of 100 million Filipinos have access to PCs.
“The Philippines is a very interesting market for us. The opportunities are quite large,” said Uday Marty, Intel Semiconductor (US) Ltd. director for Southeast Asia.
In an interview with the Inquirer on the sidelines of the recent World Economic Forum East Asian Summit in Bangkok, Marty said that in the Philippines, 20 percent of the overall market consisted of small and medium enterprises (SMEs), 99 percent of which are small enterprises with one or two employees.
“We are increasingly working with our partners, customers in the Philippines to make it easier for SMEs to improve business and use technology every day,” Marty said.
Under its NegosyanTech program, Intel is educating SMEs on how to use computers for better productivity, bundling software and solutions as part of the PC purchase.
While technology requires certain cost that SMEs may initially balk at, Marty said it would be a matter of determining the return on investment. “If we can prove that you can double your revenue with an investment of $400 to $500, that can be very, very worthwhile from an investment standpoint and we believe that’s what will happen,” Marty said.
This SME program is part of the American multinational firm’s thrust to “evangelize” the use of technology and make it relevant for consumers and businesses across Southeast Asia, where it expects to grow by a “solid double-digit” growth rate in the next three to five years, even as it already controls 80 percent of the market.
“Currently, these countries are growing at very healthy rates. But sustaining these rates is going to require improvements in productivity and you don’t get these improvements in productivity without the adoption of technology,” Marty said.
“We need technology for efficiency, efficiency drives productivity, productivity drives growth,” he added.
And while Intel has dominated the PC market, part of the growth strategy is to bring more devices powered by its chips.
Intel launched its first mobile smartphone in India last April.
“We’re starting our journey with mobile phones. We’re going to have tablets soon, and we already have PCs. Really, we’re expanding our footprint in multiple devices and we’re going to bring all those devices to Southeast Asia markets,” he said.
In the Philippines, Marty said there was still a huge opportunity for laptop and desktop computers given the low penetration.
On the tablet business, Intel has done very selective deployment and has not yet released products for the mass consumer market.
Its “Study Book,” a device meant as an educational tool, helps people learn how to use PCs and comes with a software that helps students collaborate in the classroom and allows the teacher to control all the computers in the classroom.
But the biggest news for Intel, Marty said, was a device called “Ultra Books,” which he described as the PC of the future.
He is referring to a new generation of laptops that are thin and light (3 lb) but with huge capabilities and security features. Among the innovations that will come out soon, he said, would be hybrid devices or a tablet and laptop in one, as the keyboard can be removed to switch to tablet and then back to laptop mode.
Ahead of the planned unification of Southeast Asian markets under a zero-tariff regime by 2015, Marty said government must improve education to boost competitiveness.
He said English must be promoted as a medium of business across the region, adding that this was not an issue in the case of the Philippines.
“We must bring creative problem-solving and analytical skills in the curriculum as opposed to just work learning, which is rampant in our region,” Marty said. “The curriculum must be improved and modernized and part of that is using technology.”
While education is a big piece of the needed preparation, connectivity is just as important, Marty said.
“If collectively the region doesn’t bring down the cost and the spread and availability of broadband, the growth rates that the region is enjoying now is going to be limited moving forward,” he said.