A SIGNIFICANT gap is emerging between how agile startups and larger corporations are adopting artificial intelligence (AI) into their business processes, creating what experts refer to as a “two-speed AI economy.” The deployment of the enterprise-grade AI technology, not just the use of readily available large language models (LLM) is where the gap lies.
This was a key finding from a comprehensive study on AI in the Philippines presented at AWS Cloud Day 2025 recently. Though the country is considered to be a rapid AI adopter, the way that business users of the technology vastly differ in terms of how AI is used.
During the session “Unlocking the Philippines AI Potential,” Precious Lim, AWS country manager, emphasized that a continued focus on removing barriers to adoption and highlighted that foundational cloud infrastructure and digital skills are the ultimate determinants of success in the AI era.
DEMOCRATIZE AI AWS Philippines Country Manager Precious Lim PHOTO BY RGBT
The report, conducted in partnership with Strand Partners, surveyed 1,000 business leaders and 1,000 public members. It revealed that AI adoption has reached a significant milestone, with 80,000 businesses now using AI solutions. This marks a 50 percent year-over-year growth, bringing the total to 250,000 companies, or 21 percent of all enterprises in the country — a surge largely enabled by the scalability of cloud services.
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Despite this growth, the research exposed a striking divide. While 78 percent of businesses use basic AI for process automation, only a slim 8 percent have deeply integrated it into their core product development and strategy. This disparity is most pronounced between startups, 40 percent of which leverage advanced AI to build new products, and large enterprises, where only 7 percent have reached this transformative stage.
Startups, who are mostly digital natives, often utilize cloud architectures and microservices for rapid iteration, whereas larger companies frequently face challenges with integrating legacy systems.
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Responding to a question from The Manila Times, Lim said that “the struggle with legacy systems is not only a technical one but also a matter of mindset. A lot of the technical issues can be solved by hardware or software.” She also said AWS’ “technology investments focus on removing barriers that prevent deeper AI adoption. Through cloud infrastructure, training programs, and innovation support, we’re building the foundation for the Philippines to compete globally in the AI economy.”
However, the study identified a critical skills gap as the primary barrier to adoption, cited by 57 percent of businesses. With 61 percent of jobs expected to require AI literacy within three years, specialized reskilling programs and AI-powered coding assistants are being designed to build a workforce ready for this transition.
To bridge the divide, academic institutions are emerging as crucial training grounds.
Over 100,000 Filipinos have been trained via AWS Academy, which provides higher education institutions with a free, ready-to-teach curriculum to prepare students for cloud-focused jobs and certifications. Another program, AWS Educate, is a global, no-cost program providing online cloud computing education and resources for learners of all ages and experience levels. These educational partnerships allow for hands-on AI experience with tools for natural language processing and computer vision.
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Strategic investment in the nation’s digital backbone, including content delivery networks and on-premises solutions, provides the foundation for advanced AI. Local data centers, operational since 2023, deliver the ultra-low latency crucial for real-time applications like fraud detection and predictive maintenance.
AWS also committed to a $100 million Generative AI Innovation Center that is now extending direct support to Philippine startups. This initiative offers local entrepreneurs access to large language models, GPU-optimized instances for custom AI training, and a global network of researchers. Addressing business concerns over regulatory uncertainty, which 42 percent of respondents cited as an issue, the industry offers a suite of data privacy and auditing tools to help companies innovate while maintaining compliance.
“Cloud technologies have democratized AI,” Lim said. “Businesses can implement AI in various stages of their business and change the way they approach innovation. Enterprise-grade AI capabilities can now be accessed over AWS Cloud without the prohibitive upfront hardware investments required just a few years ago.”
