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Writing about the Internet Cafes Again



    

     One of the first things that I had done the day I resigned from my corporate work was to visit 2 old friends in Marikina who are still internet café owners.  It was a welcome relief to be in the company of people who are practitioners in the industry that I was once in and had brought a lot of distinction to me as an internet café operator in Imus, Cavite.  I have not written about the internet industry in the Philippines since September of 2010 for a number of reasons particularly:


1.       I got out of the business when I got employed in Redfox Technologies as part of its marketing and sales team.

2.       Since I was representing a brand of computer system I believed that whatever that would be written about the internet industry would be construed to the brand that I represent.

3.       And most of all, I was very much frustrated when the cooperative initiative did not push through due to an internal disagreements among its proponents.


      Never the less I still tried to get in touch with what is happening in the industry through monitoring the various forums, social networking sites and interactions with people who are still in the industry. 

                Nothing much has changed since 2010:

1.       The internet café industry is still dominated by small scale internet café operators who mostly operate in their own homes or neighborhoods.

2.       Computer gaming is still the preferred business model by most internet café operators.  The success of social networking sites like Facebook and the growth of eCommerce have very little effect in terms of the manner in which the internet café owner operates his business. This has a great effect in terms of how they set up their internet cafes. Most internet cafes are still dark and humid places that cater only to gamers mostly children.

3.       It is still a capital intensive industry but internet café operators spends more in their computer units rather than investing in having a good ambiance to attract other customers.

4.       Government regulations is still be managed by the different local government units who classify the internet cafes as places for Vice along with the billiard halls and karaoke bars.  This classification is a great disadvantaged to the industry since they would not be able to get any government support unlike other industries with a much better perception and reputation.

5.       Pricing is still the main problem of the internet café operator.  From a high of Php80 to Php100 at the infancy stage of the industry now a day the average price per hour is at Php15.00.  There are instances that they are offering as low as Php5.00 per hour due to their promotional programs to attract customers.

One of the most notable change that affects the industry as a whole is the level of competition.  Before competition connotes the number of internet cafes in a particular area catering to a limited number of customer base.  This is one factor that drove computer rental prices down as more and more internet cafes were being set up in a particular area.  There used to be a time when you could find an internet café or two in almost every block in the neighborhood. Today there are less internet cafes operating as compared in the past.  Most are already established internet café owners who have been operating their cafes for a number of years.  There will be those who will try to set up a new internet café but most of the time they are clobbered by those who have established their market in the industry.

The present crop of internet café owners is not only in competition with themselves but there are also other competitors that they have to consider:

1.       Computer hardware vendors and telecommunications companies – computer hardware and internet access is becoming very affordable that internet access at home is increasing at a steady level for a number of years.

2.       Smart mobile phones and free Wifi access – made it possible for people to access the internet at their convenience.

3.       Piso Net – a new brand of internet café operators that uses a coin operated system that is able to put a number of computer units in a wider area with minimal management and is more cost effective.

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