OBG talks to Enrique Gonzalez, CEO, Intellectual Property Ventures Group (IPVG)

Interview: Enrique Gonzalez

What is the forecast for growth in the internet population in the Philippines, and what opportunities does this present for companies?

ENRIQUE GONZALEZ: The demographic situation in the Philippines is quite unique in that it is heavily skewed towards a young population that is becoming gradually more affluent. It is widely anticipated that there will be unprecedented growth in the internet population of the country, set to increase from the current 30m to roughly 50m people by the year 2014.

Access to the internet continues to proliferate throughout society through both traditional and nontraditional means. While standard access points, such as internet cafes, will continue to be a valuable tool in opening internet access to wider sections of society, younger generations are increasingly turning to smart phones and other means of getting online. Those companies and corporations that are most willing and most able to adapt and cater to this growing internet population will be at the forefront of the next generation of economic activity and development.

How can the Philippines encourage and facilitate increased technology integration among small and medium-sized enterprises (SMEs)?

GONZALEZ: When any business is evaluating the feasibility of a large-scale investment, it considers both the price of the investment as well as the expected return.

Through this evaluation process, expensive technological investments have often not been economically viable for SMEs. However, over the next few years cloud computing will bring about a revolution in terms of the relationship that SMEs, and society more generally, have traditionally held with technology.

Another positive aspect of cloud computing is that it will render software and services much more affordable for SMEs, and offer distributors and firms the capability to further cater and individualise their services to the specific demands of SMEs. These needs are typically very different to those of larger companies.

To what extent is e-commerce expected to grow in the coming years in the Philippines, and how will this change the retail landscape?

GONZALEZ: The e-commerce market of the Philippines is extremely underutilised and underdeveloped. This is primarily because the Philippines remains to this day a cash-based economy, and the use of credit cards and other electronic forms of payment is currently not as popular as it is in other countries.

However, the rapid growth of the internet population is dramatically changing how consumers and retailers are approaching the internet. While consumers are increasingly taking note of the convenience offered by online shopping, the potential population of online consumers is such that Filipino companies are now becoming aware of this growing market. The rise in online retailing will occur hand-in-hand with the gradual development of online banking, which also remains a relatively untapped market in the Philippines. As the internet population grows and Filipinos become more accustomed to dealing with finances electronically, e-commerce is expected to take off.

What are the social and economic implications of the rise of social networking?

GONZALEZ: Social networking has completely revolutionised the internet, how individuals perceive the internet, and how they interact with it. The internet is progressively becoming a more interactive experience for users, and it is also becoming a much more personal experience, one in which an individual can involve their friends and their family. The Philippines must realise that investments in the technology and IT sectors are important investments in the future of the country. Other countries in the region are increasingly directing resources to those sectors, and if the Philippines do not want to be left behind, it should do the same. Education will be key, and the government must ensure children can engage with technology at a young age to spur employment in emerging new sectors.