Miriam Santiago and Internet

The Senator has often been labeled as a bit “over the top” in her actuations.  Her proposed Magna Carta for Philippine Internet Freedom (MCPIF) clearly indicates she is not “over the top” but rather she is an individual who is totally realistic and in step with the  21st century.  Moreover, I commend her for engaging the ICT community, academe and other concerned members of society in the preparation of her proposed legislation. 

A few years ago, I wrote a series of articles on information technology. My journalist friend, Tony Lopez, told me it was boring and intimated that it was not relevant for the reading public.  Perhaps the good Senator should update Tony on the relevance of 21st century technology. 

With that as an introduction, I will now proceed to discuss trends in mobile and the Internet world.

Newspapers in the digital world: Obsolescence of newspapers?

The Chicago based TRIBUNE recently announced the purchase of 19 TV stations for $2.73 billion. According to the Tribune Co. CEO, Peter Liguori: “This is a transformational acquisition for the Tribune. (Together with the 23 stations already owned by them) It makes us the No. 1 local TV affiliate group in America, expands distribution for our high-quality video content and extends the reach of our digital products to new audiences across the country.”

One columnist opined that the publisher of the LA Times and Chicago Tribune is transforming itself to a broadcast company as it seeks to sell off its newspaper division. It would seem that the Tribune’s strategy for growth also points the direction towards the world of Internet. They already own two digital enterprises: Classified Ventures which deals in automobiles and rentals for buildings through the Internet and Career Builders which is an online job placement web page for the entire country. As stated by analyst Edward Atorino: “Internet revenue a few years ago was peanuts; now it is getting into tens of millions of dollars.  Mobile TV revenue is on the horizon.”

The future is mobile!!!

Global smartphone shipments will eclipse feature phones of the past. Smartphone prices continue to fall rapidly. I am told there are Chinese products as low as $50. According to a recent ITU study, 70 percent of the developed world population is online. In the emerging world, online penetration is 24 percent. Today there are twice as many mobile broadband subscriptions than fixed lines. With falling smartphone prices and further investment and competition in wireless broadband delivery, Internet use will ramp up significantly in the emerging world. Already as much as 20-30 percent of traffic is coming from mobile in early application developments by group companies. Kleiner Perkins Caulfield Byers report states that as of 4th quarter 2012, global smartphone subscribers in China was 270 million which was 24 percent of total mobile phones.  In the US, there were 172 million or 48 percent of total mobiles. Japan has 78 million subscribers or 65 percent of total mobiles. In the Philippines, there were 14 million subscribers or 14 percent of total mobiles.

I am not ready to predict the obsolescence of newspapers in the Philippines. But it should be noted that all local papers are also available on the Internet. Moreover, they now earn healthy revenue from advertisers. Using my iPad, there’s a built-in app called Newsstand which makes available magazines and newspapers from around the world. I was also surprised to learn that my adult children do not buy newspapers but merely bookmark their favorite papers on their tablets, laptops or smartphones.

Mobile TV revenue is also growing. In Japan and Korea, it is not uncommon to see subway passengers viewing sports on their mobile. On a limited basis, some mobile phones can do the same locally.

The TRIBUNE purchase is a manifestation of technological convergence. Locally, PLDT led by Manuel V. Pangilinan has taken the lead.  He has SMART, TV 5 and investments in several local newspapers.  As stated in another column, unlike government regulators he understands the meaning of convergence.

Last month, I attended a technology presentation by a very successful technology company.  There are three aspects of the Internet world which I would like to discuss:

Classifieds

Like most forms of printed media, the classified ad has found its way to the Internet. Classifieds in the past was in reference to ads in the newspapers or in the radio or TV. Today, classifieds on the Internet is growing by leaps and bounds.  For example in the Philippines, there is Sulit.com.ph. A young man, RJ David and his wife decided to join the Internet world having been inspired by Steve Jobs and the like. Today Sulit, I am told, has 65-percent share of the classifieds market.  I first learned about it from my son and daughter who told me to go to Sulit if I wanted to buy a car and compare prices. I am convinced that classifieds on the Internet will eventually displace any local paper that is dependent on classified advertising.   

E-tailing

In the field of ecommerce, retailing as we know it today will be replaced by E-tailing. In the US, on Black Friday, 24 percent of all Internet shopping came from mobiles and tablets.  The Macy’s and Saks 5th Avenue type will be substantially impacted.  The forecast is 10-20 years.  The buying public will be conditioned to buying on the Internet a la Amazon.com.  Department stores will only need to have demonstration shops where buyers will go to “touch and feel” but actual purchase will be through the Internet.  In turn these large department stores need not have huge overhead expenses in bricks and mortar and staff.

Payment gateway

But the key to a successful Internet venture such as just described is the ability to pay over the Internet. Today, there are many such gateways.  The most notable is PayPal.  Of course, the use of the credit card has also thrived in the developed world.

This time, I hope I have caught the attention of my friend Tony and the reading public.