Strategic Road Map for a Better

Internet Café Industry

2010 – 2012

I-Café Pilipinas

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Background

Internet Café Industry in the Philippines

An internet café or cybercafé is a place where

one can use a computer with Internet access,
most for a fee, usually per hour or minute;
sometimes one can have unmetered access with a
pass for a day or month, etc. It may serve as a
regular café as well, with food and drinks being
served.

History

The concept and name, Cybercafé, was

invented at the beginning of 1994 by Ivan Pope. Commissioned to develop an Internet
event for an arts weekend at the Institute of Contemporary Arts (ICA) in London. Pope
wrote a proposal outlining the concept of a café with Internet access from the tables. The
event was run over the weekend of 12-13 March 1994 during the 'Towards the Aesthetics of
the Future' event.

In June 1994, The Binary Cafe, Canada's first Internet café, opened in Toronto, Ontario.

Here in the Philippines, the first internet cafes was established in the late 1990’s as
gaming centers whose computers were connected by a local area network (LAN) in which
offline games such as counter strike were usually played. It later evolved as internet cafes
with the introduction of internet access through a dial up connection.

Greater advancement and improvements to the industry was achieved with the
introduction of a faster internet connection service commonly known as DSL (Digital
Subscriber Line). More services were added such as online gaming, video streaming and a
much faster internet browsing.

In a report that was prepared by Yahoo and Nielsen, it states that even if the
Philippines has a low computer penetration rate of 14 percent, it still has a strong internet
presence since 70 percent of internet related access in big cities and municipalities around
the country is primarily done through the internet cafes. A recent survey that was
conducted by a gaming company stated that there are about 11,000 licensed internet cafes
that could be found in the country but the number could increase if we take into
consideration the vast amount of unlicensed internet cafes operating in private homes and
communities.

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Role of the Internet Café to the Community

The internet café owner has to realize the important role to which his industry plays in
the community. We are the front liners in the rapidly changing world of information
communication technology. We serve as the bridge between the community that could not
afford to have their own computer systems and DSL connection at home to the rapidly
changing world of the internet. We provide a service and have the technology to be able to
change the social and economic conditions in the municipalities and cities in which we
operate.

Services Offered by Internet Cafes

Internet cafes is a service oriented business organization that offers a variety of services
that is related to information communication technology. Examples of services are:

1. Computer Rental – the bread and butter of any internet café. Computers are usually
rented out to customers by the hour or depending upon the needs of the customers for the
following activities:

 Internet Browsing – searching the internet for information through the use of
a web browser

 Online gaming - Online games are played over some form of computer
network, now typically on the Internet. One advantage of online games is the ability
to connect to multiplayer games, although single-player online games are quite
common as well.

 Offline gaming- these are stand alone games that does not require the use of
an internet connection to be played.

 Word processing or desktop publishing

2. The most common service offered is typing or encoding. This usually appeals to
customers who are too lazy to type, or who have little no access to a computer. This service
also appeals to busy people who don’t have time to type and edit their material. These
customers would simply leave their work to be typed and pick it up after it is completed.

3. Saving and transferring digital files in compact disk through the use of a cd burner.

4. Computer Repair Services – most internet café owners are computer technicians who
has the capacity to fix the hardware and software malfunctions.

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5. An internet café can also provide specialized or sophisticated software to be available
for use by its customers. These software may be kind that the hard to find, or expensive, or
utilizes a large amount of memory.

6. Another service that an internet café can offer is photo editing. The client might have
a picture that can be scanned or digitally edited, fixed up, or restored. While photo editing
can be done at home, it takes time to do the more difficult or complicated jobs, and people
would rather pay somebody to do the job properly rather that bungle it themselves.

7. Video editing is also another service that can be offered by the internet café, in much
the same way as photo editing.

8. Internet cafés can also offer simple programming solutions. They can offer programs
for the home offices or small business, like basic databases or inventory software.

9. The internet café may also offer workshops or lessons. These lessons may range
from simple familiarization with the computer to more difficult subjects. One-on-one
tutorials by the café staff may also be provided to clients who require the service.

10. Some internet cafés have amenities that make them more like meeting places or
boardrooms, where they offer videoconferencing, group discussion tables, and other
facilities for meetings and group work.

Kinds of Internet Cafes

1. Internet Only Cafes – these are internet cafes that cater exclusively to internet users
only. No one line and off line games are installed.

2. Pure Gaming Internet Cafes – These are internet cafes that exclusively cater to both
on line and off line gamers. Their internet browsers are deliberately disabled to prevent
game lag.

3. Combined Internet Cafes – these internet cafes cater to both internet users and
gamers.

4. Internet Kiosks – is a computer terminal that provides information access via

electronic methods. Interactive kiosks sometimes resemble telephone booths, but can also
be used while sitting on a bench or chair. Interactive kiosks are typically placed in high foot
traffic settings such as hotel lobbies or airports.

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Basic Characteristics of the Internet Café Industry

1. It is a capital extensive type of industry – people with very limited amount of

capital at start up should not consider engaging themselves in this type of activities.
Investments have to be made for the physical facilities, Computer hardware and
software, peripherals, electrical and network setup. A certain amount of capital
funds should be set aside to subsidize the first few months of operations as you are
building your customer base. These would include payment for salaries of personnel,
telephone, DSL charges, rent and electricity bills.

2. It is a highly technical type of industry – most of the internet café owners

engage themselves in the internet café business without the sufficient technical skills
that they need in order to maintain their computer units. Thus they rely much on
the services of computer technicians once they encounter some problems with their
units. The services of these technicians are often time very expensive. Internet café
owners must have a sufficient knowledge on maintaining their computer units in
order to minimize these types of cost.

3. It has a rapid rate of obsolescence - Moore’s law, proposed by Intel founder

Gordon Moore in 1965, states that at a price point the processing speed of computer
chips double every 18 months. Moore’s law only tells us that any computer units that
are bought today will be obsolete within two years. It would be replaced by
computer units much more powerful and efficient at a lesser price than what it is
today. This is certainly true in the online gaming requirements that keeps on
increasing each year thus internet café owners have no other choice but to upgrade
their systems so often just to keep up with the requirements.

4. It has no central government body to control it – unlike other industries in

which a certain government agency is assigned to regulate it, internet café
operations is still considered to be a backyard industry thus no central government
body is setting the standards and regulations in which to control the players in the
industry. Regulating the industry is often left to the local government that provides
ordinances and regulations that are sometime detrimental to the development of the
internet café industry.

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 5. It has a high level of competition – it seems that a lot of people would like to
engage themselves in this business. We don’t really blame them for in this industry
your limitations would only be your own. The potential in offering services through
the use of the internet is unlimited all you have to do is to find the right information
that is available in the internet. This provides a situation in which there are too
many players catering to a specific market thus cut throat pricing is a regular feature
of this industry.

I-Café Pilipinas
I-Café Pilipinas is a national network of
internet café owners, operators and associations in
the Philippines. It strives to become their voice on
a national level to represent their interest on issues
pertaining to efficient operation of their business.
It hopes to represent the ideals, aspirations and
dreams of each internet café owner, operator and
association as they take to the task in contributing
to the development of their communities by
providing affordable internet access and superior
service.

I-Café Pilipinas is a consultative assembly of

its members. It hopes to provide them a venue in
which discussions could be held on issues affecting the efficient and profitable operation of
their business. It hopes to incorporate training programs, linkages with allied business and
proper representation on a national level. It would never represent nor will ever strive to be
a regulating body that would imposes regulations and imposes fines on its members.

I-Café Pilipinas believes that collaboration is the key in creating the dynamics to
institute changes in the internet café industry. It does not and will not strive to supersede
or to take over any formal internet café association already existing on the local level. In
fact it encourages the formation of local internet café organizations in places in the country
where there is none. It hopes to work with the officials and members of the local internet
café associations by providing them a national program that could lead to the total
development and acceptance of the internet café as a partner in nation building.

I-Café Pilipinas keeps the door open for discussion rather than taking on a combative
stand on issues affecting the operations of the internet café. It hopes to form consultative
linkages with government institutions and allied industries in the formulation of policies that
would greatly affect the industry.

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 I-Cafe Pilipinas

“Challenging the I-Cafe Industry in the Philippines to do better”

I-Café Pilipinas believes in the internet industry and

its important role in providing affordable internet access to
the Philippine community. It believes that the internet cafe
industry could provide greater opportunities and can
contribute to community development. It believes that
through proper education and training, the internet cafe
owners, operators and the different icafe associations could
be a great influence in the daily lives of the average Filipino
through information communication technology.

I-Café Pilipinas believes in the following:

Community Building – the I-cafe owner is an

integral part of today’s community by providing
affordable internet access to a majority of Filipinos
who could not afford to have one at home or at
work. He is the bridge that provides the community
with access to the wider world of the internet.

Professionalism – the I-cafe owner should be aware of his great responsibility in

operating an internet cafe in their respective community. As compared to other
industries his business establishment creates a greater impact to the community in
which he operates in that sometimes could change the lives of the people around
him.

Ethical Use of Technology – “Great Powers means Great Responsibilities”, the

internet cafe owner being in the fore front in the rapid changing technology should
be guided on how to use these technology that would bring improvements in the
lives of the people in their respective communities.

Social Entrepreneurship – engaging in business not only for profit. Internet cafe
owners are socially aware to the effects of his business to his customers and the
community.

Our Mission

Our Mission is our purpose that serves as the standard against which we weigh our actions
and decisions:

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  To uplift the image of the internet cafe as a business that could
contribute to community development
 To uplift the quality of life of the internet cafe owner/operator
 To create the dynamics to inculcate values formation and fair business
standards for the internet cafe owner/operator.

Our Vision

Our vision serves as the framework and guides every aspect of our network by describing
what we need to accomplish in order to continue achieving sustainable, quality growth.

 Internet Cafe Owner/Operator – to

provide programs, trainings and linkages
that would improve the manner in which
they are engage in their business
 Community – Uplifting the standards of
services of each internet cafe business
around the country to ensure of their continuous consumer
satisfaction.
 Partners – provide meaningful linkages with customers and allied
companies to ensure the continuous growth and development of the
internet cafe industry.

Values

Our values serve as a compass for our actions and describe how we behave in the world.

o Leadership: The courage to shape a better future

o Transparency: What we do, we let other people know
o Collaboration: Leverage collective genius
o Integrity: Be real
o Accountability: If it is to be, it’s up to me
o Passion: Committed in heart and mind
o Camaraderie: Friendship through advocacy
o Professionalism: We do unto others what we expect them to do to us.

I-Cafe Pilipinas is a social advocacy group the primary purpose of which is to start
the initiative in building a national network of internet cafe owners around the country. it is
aiming to be the voice of every internet cafe owners/operators on issues that greatly affects
the operations of his business.

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 I-Café Pilipinas Strategic Roadmap for the Internet Café Industry
2010 -2012

The challenge is great for the internet café

industry to transform itself from its present
condition to be the leader in information
communication technology integration in the
community level. There is a need to uplift the
image of the industry from all levels in order to
command respect from government authorities
and their client-aficionados.

I. Creating the National Network

I-Café Pilipinas is only a national advocacy network. It primarily concerns itself in

creating networks and formulating programs that aims to bring improvements in the
internet café industry in the Philippines. It relies on a national based network of its affiliates
in order to deliver these programs on to the different internet café owners and operators
around the country.

Identification and strengthening of the different internet café

associations at the community level. – I-Café Pilipinas hopes to identify and
get in touch with the different internet café associations that already exist in the
different parts of the country to discuss with them possible collaborations that
could lead to the strengthening of the industry in their respective places.

Encouraging the formation of internet café associations on places where

there is none – I-Café Pilipinas hopes to provide information and training to
internet café owners in a particular area to encourage them to form an internet
café association of their own so that they would be properly represented.

Formation of Local Chapters – in places wherein the local internet café

associations are not willing to form a collaborative alliance with I-Café Pilipinas or
would not want to form their own internet café associations the formation of a
local I-Café Pilipinas Chapter of Affiliates would be encourage as long as there is
a clamor among the internet café owners in the area to form one.

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 II. Linking the Internet Café operators with the rest of the ICT
community.

I-Café Pilipinas believes that finding solutions to the problems facing the internet
café industry does not only lay with the internet café owners themselves but it also need the
involvement of the rest of the stakeholders in the ICT industry. Part of the work of I-Café
Pilipinas is to network with the other stakeholders in the ICT industry particularly in the
following areas:

Affordable Computer Hardware and

peripherals – the success of an internet café
operator depends on the fact that he must
have access to affordable computer packages
and peripherals that would suit his needs and
the needs of his customers.

Affordable Computer Software Systems –

I-Café Pilipinas hopes to bring a resolution to
the use of pirated software in the internet café
industry by talking with the software
developers on a program that would bring
about an affordable software package to the
internet café operators. In order for the
industry to grow it must not be in constant threat of being shutdown or being
harassed by law enforcers due to the proliferation of pirated software in the
industry. I-Café Pilipinas hopes to inculcate to the internet café owner that
purchasing of genuine software is not really an expense but of an investment
on their part since they would be able to enjoy other benefits that they could
use as an add on their basic services.

Access to Affordable Capital – One of the primary reason why an internet

café owner could not grow in this industry is that they are limited to the
amount of money that they have invested in their respective internet cafes.
Finding additional and affordable capital that they could use for additional
computer hardware and improvements are very difficult to come by due to
the fast depreciation of computer units and most of them lack the necessary
legal documentation so that they could be eligible to this kind of facilities. I-
Café Pilipinas hopes to network with financial institutions that offers micro
lending facilities to provide affordable capital to the internet café owner. In
the long run it is hoped that I-Café Pilipinas would be able to establish an ICT
cooperative in each of its affiliates.

Better relationship with the national government agencies and the

local government units – I-Café Pilipinas hopes to strive for a better

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 working relationship with national government agencies and the local
government units in order to come up with policies and legislations that would
aim to provide support instead of restrictions and greater participation of the
internet café industry in community affairs.

Better Relationship with Educational Institutions – For years now the

internet café and educational institution has been at odds with each other due
to the nature of its operations. I-Café Pilipinas hopes to hopes to bridge the
gap between the two by making the internet café as a platform for education
and safe internet access to the students.

The Internet Café as a Platform for the Development of eCommerce

and eGovernance in the Philippines. – I-Café Pilipinas believes in the
power of the internet in developing trade and commerce in a particular area.
It also believes in bringing government services closer to the people through
the use of the World Wide Web. It hopes to develop the internet café as a
platform in which these services could be availed by the respective
communities that could bring economic development and greater government
presence.

III. Continuous development of the Internet Café Owner through

education

I-Café Pilipinas hopes to improve the

conditions of the internet café industry in the
Philippines by providing standards in which will
improve the services rendered to the customers
by the internet café operators. It does not
subscribe to the idea of imposing regulations but
strives for the continuous development of the
internet café owner through education. I-Café
Pilipinas believes that fear through the imposition
of regulations would not work and is committed in
the formation of educational materials that would inform the internet café owner on how to
properly run his business to earn a decent profit from his operations.

I-Café Pilipinas believes that innovation is the key in improving the present situation
of the internet café industry. It hopes to provide information to the internet café owner on
the latest innovations and trends in the ICT industry through various ways:

Through regular workshops and seminars to be organized by the different

internet café associations in the different places in the country

Through postings in our website, forum and blogs

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By subscribing to our emagazine that would be made available to the internet
café owner on a regular basis

It hopes to form the I-Café Academy that would be the one in charge of the
training of the internet café owner either online or by attending one of its
official classes.

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