Philippines Overtakes India as Hub of Call Centers
11-26-2011, 04:15 PM, (This post was last modified: 11-26-2011, 04:16 PM by Miguel.)
Philippines Overtakes India as Hub of Call Centers
Thought this was interesting given the popularity of American Idol in the Philippines.

Quote:MANILA — Americans calling the customer service lines of their airlines, phone companies and banks are now more likely to speak to Mark in Manila than Bharat in Bangalore.

Over the last several years, a quiet revolution has been reshaping the call center business: the rise of the Philippines, a former United States colony that has a large population of young people who speak lightly accented English and, unlike many Indians, are steeped in American culture.

More Filipinos — about 400,000 — than Indians now spend their nights talking to mostly American consumers, industry officials said, as companies like AT&T, JPMorgan Chase and Expedia have hired call centers here, or built their own. The jobs have come from the United States, Europe and, to some extent, India as outsourcers followed their clients to the Philippines.

India, where offshore call centers first took off in a big way, fields as many as 350,000 call center agents, according to some industry estimates. The Philippines, which has a population one-tenth as big as India’s, overtook India this year, according to Jojo Uligan, executive director of the Contact Center Association of the Philippines.

The growing preference for the Philippines reflects in part the maturation of the outsourcing business and in part a preference for American English. In the early days, the industry focused simply on finding and setting up shop in countries with large English-speaking populations and low labor costs, which mostly led them to India. But executives say they are now increasingly identifying places best suited for specific tasks. India remains the biggest destination by far for software outsourcing, for instance.

Executives say the growth was not motivated by wage considerations. Filipino call center agents typically earn more than their Indian counterparts ($300 a month, rather than $250, at the entry level), but executives say they are worth the extra cost because American customers find them easier to understand than they do Indian agents, who speak British-style English and use unfamiliar idioms. Indians, for example, might say, “I will revert on the same,” rather than, “I will follow up on that.”

It helps that Filipinos learn American English in the first grade, eat hamburgers, follow the N.B.A. and watch the TV show “Friends” long before they enter a call center. In India, by contrast, public schools introduce British English in the third grade, only the urban elite eat American fast food, cricket is the national pastime and “Friends” is a teaching aid for Indian call center trainers. English is an official language in both countries.

...Some American companies like Delta Airlines have said they moved call centers back to the United States to appease angry customers who wanted better English. Entry-level American call center agents earn about $20,000 a year, about five times as much as similar agents in the Philippines and six times as much as Indian agents.

Nevertheless, the financial benefits of outsourcing remain strong enough that the call center business is growing at 25 to 30 percent a year here in the Philippines, compared to 10 to 15 percent in India, according to Salil Dani, research director at the Everest Group, a firm that tracks the market.

American outsourcing or back-end companies like I.B.M., Accenture and Convergys along with Indian firms like Aegis, Infosys and Tech Mahindra have thousands of employees working from gleaming glass towers and even inside malls, which executives say young workers prefer so they can be close to shops and restaurants.

...In the last two years, the Philippine peso climbed nearly 10 percent against the dollar, to 42.14, before weakening recently.

If the peso appreciates to 35 to the dollar, many of the call centers in the Philippines will not survive, said Narasimha Murthy, president of HGS USA, the American arm of an Indian outsourcing company that employs 4,000 people here.

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