The amazing economic potential of the Internet and social media

The secret of success in life is for a man to be ready for his opportunity when it comes.  — Benjamin Disraeli

If there is an award in Philippine business for “dealmakers of the year,” PLDT/Smart boss Manny V. Pangilinan and his former competitors John Gokongwei Jr., James Go and Lance Gokongwei of Digitel/Sun Cellular should be hands-down winners.

Coincidentally, PLDT and Digitel were inspired by their example. AT&T in the US also shocked the world with its recent $39 billion buyout of T-Mobile USA, raising valid worries, however, that less competition would mean higher prices for consumers.

MVP and the Gokongwei family’s recent business coup of the PLDT Group buying 51.55 percent of rival Digitel for P69.2 billion in a share-swap deal has in effect eliminated one of the most dynamic competitors in the Philippine telecommunications industry, since the latter’s Sun Cellular is best remembered by consumers for its aggressive price war and various offers like free texts and free calls.

Apart from the shock and awe of most businesspeople and the general public at this mega-deal strengthening PLDT/Smart group’s control of the Philippine telecom market, even archrival Globe Telecom of the Ayala Group is perceived to have gained since not a few presume that this will revert the local telecom market back into a duopoly again.

With the upstart and aggressive third-party price-cutting competitor Sun Cellular taken out of the picture, what can be done to ensure that we consumers can also be winners and that competition among the remaining telecom players can be enhanced?

Can we expect the Lopez clan of Bayantel, Ramon Ang of the San Miguel Group or other dynamic entrepreneurs out there to step into the arena and add real competition necessary for dynamic free enterprise to reign and for consumers to benefit?

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One segment of the telecom industry where the PLDT Group of MVP is the undisputed king without the need to co-opt or buy out competitors with mega billions is its Smart wireless and PLDTmyDSL businesses. This writer’s research showed that the PLDT Group already now controls 70 percent of the online market, with over two million Internet subscribers (not counting Sun Cellular’s online subscribers).

This 70-percent market dominance of the PLDT Group can be broken down as follows: PLDTmyDSL has 700,000 subscribers categorized as postpaid accounts or the high-end market, while Smart Internet wireless has about 1.3 million subscribers, of which 90 percent are prepaid accounts. The growth here is fast and potential to grow still huge.

What is indeed most impressive in this Internet leadership of MVP’s PLDTmyDSL is its fascinating and fun Watchpad product, which provides subscribers with entertainment channels free. It makes the PLDT Group into a multimedia giant. I believe this product of online entertainment is the wave of the future, and the government should perhaps work with MVP to make Philippine entertainment, music and other creativity available to be sold online to the rest of the world!  

Many college students where I teach part-time and even my fellow young entrepreneur friends tell me that PLDTmyDSL’s Watchpad product is that telecom giant’s competitive edge and ace for future unlimited growth. Why? Content and entertainment distributed online can be a business with unlimited growth potential not only in the Philippines with 93 million people, or to the 12 million overseas Filipinos, but to the whole world in cyberspace.

We cannot compete in industrial factories now but in terms of creativity and entertainment, the Philippines can be globally competitive. Entertainment is not a small business. Look at the US; almost all its factories have been defeated by China or South Korea, but America still rakes it in every year through its Hollywood studios, pop music, and TV shows.

Right now, PLDTmyDSL’s Watchpad has 17 television channels for free that can be viewed on laptops or computers, even while we surf the Internet or tweet on Twitter or post on Facebook simultaneously. Watchpad also has music channels, cartoons and other stuff, with its focus primarily on entertainment and social media.

I suggest that local film producers like Regal Films, Star Cinema, Viva Films and Solar Entertainment cash in on this technological innovation and sell their movies to a bigger audience online in partnership with MVP’s PLDTmyDSL. Why limit one’s market for film, Filipino songs or Original Pilipino Music (OPM) and TV shows just to TV networks, movie theaters or CDs?

In the not-so-distant future, I foresee that PLDT will practically own the average home in the Philippines, in the sense that the voice services of telephones will work harmoniously with PLDTmyDSL’s services.

Not only is the Philippines well-known for music and entertainment, or the leader in call centers and BPOs — surpassing giant India — we’re also becoming pacesetters in the social media field.

Based on my research, the Philippines is already the world’s 14th biggest user of Facebook, while Wilson Tieng and his elder brother William Tieng of Solar Entertainment Group recently told me that the Philippines is No. 1 in Google Search for “Justin Bieber” now in this period of the hit movie Never Say Never, which all show that we are among the most Internet-savvy nations in the world.   

True, we should promote pro-investor policies to boost our factories, agriculture, tourism and services sectors, but let us take a very serious look at the amazing economic potential of the Internet and social media, too.

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Congratulations to the Federation of Filipino-Chinese Chambers of Commerce & Industry, Inc. (FFCCCII) for its recent biennial convention at SMX, Century Park Hotel, Manila Hotel and the Federation building in downtown Manila. It elected new officers led by garments tycoon Tan Ching as president, Davao’s Guilbert Go as executive vice president, various vice presidents Domingo Yap, Henry Lim Bon Liong, Alfonso Siy, William Gosiaco, David Chua, Angel Ngu, Ong Eng Chan and Alex Yap Cho Ty. The newly elected treasurer is Michael G. Tan of Asia Brewery and auditor is William Tieng of Solar Entertainment.   

Sources told this writer that President Noynoy Aquino respected the independence of the Federation and its election, but in his speech at SMX he expressed the hope that the new FFCCCII leaders would be people whom his government can work well with.

The chairman emeritus of the FFCCCII is taipan Lucio C. Tan, with honorary presidents such as Dr. Alfonso Uy, Jimmy Tang, Ambassador Francis Chua, Ambassador Domingo Lee, Robin Sy, John K. C. Ng, Vicente Yu and John K. Tan.  

For decades the biggest project of the FFCCCCII has been “Operation Barrio Schools,” which donated thousands of public school buildings to help the poorest rural regions of the Philippines. From small/medium entrepreneurs to taipans, businesspeople have supported this civic project because they believe that the best way to solve poverty is through better democratic access to public education nationwide.

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