InterGapo

Friday, July 14, 2006

Cheaper rates contribute to growth of RP Internet cafés

By Alexander Villafania - INQ7.net

The Internet café business in the Philippines continues to grow in previous years spurred by decreasing prices of broadband Internet and computer parts, as well as increasing demand for online and network gaming services.

A new report by the Philippine office of the International Data Corporation (IDC) also showed that Internet cafes are also finding niche markets catering to gaming, Internet use and sales centers for other value-added services such as telecommunications and printing.

The IDC report said most Internet cafes in the Philippines are still micro-sized businesses or those that only have a few available computers with single ownership and only one branch.

Most of the value-added services of these cafes are document printing, scanning, fax and copying.

Likewise, the report said that these pay-as-you go Internet cafes are still preferred by most users over owning home PCs especially as the cost of owning computers is still largely restrictive to most Filipinos.

IDC Philippines Research Manager Manuel Ravago said in a statement the next 12 months will see more Internet cafes concentrating heavily on maintaining or replacing present hardware setups. These Internet cafes will also continue to focus on online gaming nature and basic Internet.

The IDC also reported that 49 percent of all Internet cafes surveyed were not changing their IT expenditures. Another 39 percent said there would be an increase in maintenance or replacement cost while 10 percent said there would be no change.

Ravago also added that Internet cafes in the rural areas should be taken into perspective to be able to secure key business prospects.

"The decelerating broadband costs, growing uptake of online gaming, and declining hardware prices have all served as catalysts for growth in information and communication technology spending from the Internet café industry. In order to capture that potential business opportunity from the sector, the nature and preferences of the Internet cafes must be considered at all times when addressing this particular market", Ravago said.

IDC also forecasts the arrival of new value added services from both entrepreneurs, the access providers and the hardware providers as the Internet café becomes a feasible business to address requirements of new markets.

Likewise, stiffer competition from other Internet cafes will also prompt owners to improve their services.

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