Filipino Mobile Phone User Report - DigitalFilipino StatsReport (2nd issue)

THE DIGITALFILIPINO STATSREPORT

ABOUT THE WRITER

Janette Toral is an IT writer, speaker, consultant, educator and lobbyist. She founded the Philippine Internet Commerce Society last September 1997 and got heavily involved in working for the passage of the country’s Y2K Law and E-Commerce Law.

She has written articles for international publications such as Business Online, asia.internet.com, and World Executive Digest. She published her first book in June 2000 titled, “DigitalFilipino: An E-Commerce Guide for the eFilipino”.

She’s frequently invited at various IT conferences to talk about information technology, web, outsourcing, and wireless developments in the Philippines.

An IT practitioner, she has more than 13 years of combined experience in the areas of research, training, marketing, business planning, technical support, and project management.

STATSREPORT

Having access to the latest Internet, ecommerce, outsourcing, wireless, and information technology research is not easy to keep up to. Tasking an entity to do such service on a customized level is expensive as well.

DigitalFilipino.com is the country’s premiere e-commerce research site on the Internet since September 1999. Beginning June 2002, we came up with a monthly StatsReport service, a printed report giving analysis on local and international statistical developments in the field of information technology, Internet, e-commerce, outsourcing, and wireless markets. Subscribers are invited to participate in our monthly briefing whenever a report is released. This is to provide direct interaction and get feedback on additional information needed.

We do our own research and person-to-person surveys. Its up-to-date status is included in every monthly report. Our data gathering is through survey interviews as personal interaction is important to us. Every respondent also gets a token, book or report, when they fill up our forms. We will cover all regions in the country as we progress.

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The following is our 2002 – 2003 report schedule: • June 2002 – The Filipino Online Shopper • July 2002 – The Filipino Mobile Phone User • August 2002 – The Filipino Internet User • September 2002 – State of Philippine Outsourcing Industry • October 2002 - The Filipino Internet Banker & State of Online Financial Services • November 2002 – State of Philippine I.T. Education • December 2002 - Philippines Going High Tech – Trends in Filipino Ownership of Computing

Devices (digital copiers, digital cameras, video cameras, printers, scanners, multifunctional machines, projectors, and personal computers)

• January 2003 – State of Philippine Internet Service and Data Center Providers • February 2003 - State of Philippine E-Commerce (Internet and Mobile) • March 2003 - State of Philippine I.T. Manpower • April 2003 - Philippine SMEs’ I.T. Usage and Spending • May 2003 - To be announced

Copyright© 2002 by Janette Toral, DigitalFilipino.com.

All rights reserved. This report or any part of it may not be reproduced,

stored, transmitted in any form and means without the written permission

from the author.

All Nokia phone images are copyright of Nokia and were taken from the press section

of http://www.nokia.com.

Layout, design and illustrations by Antonio Bucu.

StatsReport subscribers who would like to ask questions related to this report

can email the writer at:

[email protected]

or call

0919-2961929

You may also visit:

http://www.digitalfilipino.com http://www.digitalfilipino.ph

The following are useful references for this report.

Yankee Group (http://www.yankeegroup.com)

Computer Industry Almanac (http://www.c-i-a.com)

Mobile Portals - "The Sleeping Beauty" Market Waiting to be Awakened? (IDC#HM01H), International Data Corporation (http://www.idc.com)

REFERENCES

THE DIGITALFILIPINO STATSREPORTThe Filipino Mobile Phone User - July 2002THE DIGITALFILIPINO STATSREPORT The Filipino Mobile Phone User - July 2002

STATSREPORT2

Percent (%)

Noki

a M

odel

s

3310 3210 5110 6210 615082108250 333052108310885092109110625061103350

Popular Nokia Models

0 5 0 15 20 25

Demographic Profile NCR – 60%

Mindanao

Region XI – 8%

Region XII – 1%

Visayas

Region VI – 1%

Region VII – 10%

Luzon

Region II – 1%

Region III –2%

Region IV – 12%

Region V – 5%

Brand Ownership of Mobile PhonesAlcatel - 2%Bosch - 1%Ericsson - 6%Motorola - 3%Nokia - 82%Panasonic - 1%Philips - 1%Sendo - 1%Siemens - 1%Trium - 1%

Percent (%)

(91 % or 483 of respondentshave mobile phones)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Mobile Phone Ownership

0 20 40 60 80 100

WIRELESS PHENOMENONTHE FILIPINO MOBILE PHONE USER HABITS

THIS 2nd issue presents an interestingperspective as we try to capture thehabits of the Filipino Mobile Phone User.

In the year 2000, I began recognizing thepower that wireless technologies has to offerto people all over the world in making thingsbetter and improve the way we do things. Itis like the 3rd wave of the Internet but muchmore. If the uptake of the PC and Internetwas slow in the country, the mobile phonereached the stage of pervasive computingsooner as more and more Filipinos use it intheir daily lives.

It is estimated that there are 12 millionFilipino mobile phone users as of this writing.The growth of the wireless market has beentremendous and unexpected for most of itsplayers. For the wireless applicationdevelopment industry, it providedopportunities for wealth creation.

The Filipino Mobile Phone User Habits is asurvey we’ve been doing since February 2002.Respondents are from Metro Manila, Davao,Cebu, Bicol, and other parts of the country.The result of our survey does not speak forthe entire industry at this time. I gather datathrough traditional means and will covermore location and depth as it progress.

91% or 483 out 528 of our respondents owna mobile phone. Majority of them with aNokia phone. The Yankee Group estimatesthat global handset sales for 2002 can reachup to 435.7 million.

In the year 2001, Smart and Talk ‘N Text hadan aggregated total subscriber base of6,369,000 (3.5 million in the year 2000).Globe, on the other hand registered 4.6million subscribers (79% growth from 2000)in 2001. The entry of new players, Digiteland Extelcom, this year in the GSM cellularmarket is more than welcome as this givesmore option to Filipinos.

It is interesting to see that Smart edges overGlobe for ages 24 and below. Prepaidsubscription shows great popularity for allages. However, majority of the people weinterviewed in the 37 to 45 age groups haspost-paid subscription.

Mobile Carriers

Globe - 57%Smart - 41%TouchMobile - 1%Talk N' Text - 1%

Prepaid - 70%Postpaid - 30%

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

Respondents (528)

0 5 10 5 0 5Close to 150-200 million text messages aresent through the country’s mobile networkseveryday. On the average, the Filipino MobilePhone User sends 20 text messages a day andspends P1037 for their prepaid and post-paidsubscription per month.

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Distribution of Ownership

0 5 10 5 0 5

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Monthly Texting Average

0 5 10 5 0 5 0

However, the country’s text messaging capitalclaim can only be sustained if carriers andwireless application developers (WAD) will worktogether to keep the market alive and kicking.Consistent promotion is key to this end.

A majority of the subscribers are usingprepaid cards, carriers are finding ways tomake it easier for subscribers to refill theirphone cards. Globe allows its subscribers toreload their prepaid card through BPI ExpressOnline (http://www.bpiexpressonline.com)and BPI Express Cash via ATM. Smart does ittoo with its SmartMoney card.

The first issue presented a lot of lessonslearned and clarification that needs to bemade. Such as:

1. 20% of our total respondents last monthwere actual online buyers. Their combinedpurchase totals to US$35,000 last year. Sofor those who said that e-commerce has notyet taken off, perhaps it did. However,instead of our local dotcom sites benefitingfrom it, foreign sites did.

2. The ranking of shopping websites andpopular categories were based on the numberof respondents that claimed they’ve boughtsuch items from them. While doing the 1

st

report, we realized that we have to validateeach shopping category mentioned to us bya respondent and ask which site they boughtthe products from. This is after noticing that

CLARIFICATION: THE FILIPINO ONLINE SHOPPER II

Distribution of Online Buyers(20% of total respondents)

21-24 (15%)24-28 (30%) 29-32 (11%) 33-36 (15%)

37-40 (10%)41-45 (6%) 46-55 (10%)56-up (3%)

travel services, which is one of the top fiveshopping categories, did not had a clearwebsite leader in our survey. e issues,we’ll be able to clarify how much has onebought from each of the sites mentioned too.

Where do Filipinos Buy Online(2001)

Amazon (54%)eBay (11%)MyAyala (11%)Network Solutions (8%)Barnes and Noble (6%)Register.com (6%)

US$522.13 average annual purchase per user

• Books •• Computer software •

• Domain name •• Travel services •• Web hosting •

What Filipinos Buy Online (2001)

3. Not only the smart nouveau rich (SNR)buyers are maturing but the upper middleclass as well. Online merchants who want toprofit at this time should focus on meetingthe needs of this market.

4. It is a fact that there’s no empirical dataexisting at this time that tells the truePhilippine Internet situation. However, byMarch29 next year, we hope that things willchange as we gear up for One Internet Day2003 (http://www.oneinternetday.com). Forthe first time, 16 speakers from Regions 1 to12, CAR, ARMM, NCR, Caraga will bepresenting their respective regional Internetsituation.

1

1 2 2

1 2 2

1 2 2 3

In futur


STATSREPORT3

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Logos and Icons

0 5 10 5 0 5

Percent (%)

Freq

uenc

y

Once a MonthOnce a Week

Twice a MonthTwice a Year

DailyTwice a Week

Once Only8 X a Year

3 X a Month

Logos & Icons - Frequency

0 5 10 5 0 5 0 5

VAS

Logos & IconsRingtones

Picture MessagesNews

HoroscopesJokes

QuotesSportsGames

Banking

Use of Value-Added Services

Percent (%)

Celebrity NewsLocation Finder

Gig SchedsBiorhythmShopping

ForexChat

RecipesEmail

MoviesTraffic

0 10 20 30 40 50

Number of respondents that have used the VAS

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Ringtones

0 5 10 5 0 5

Filipinos have become emotionally attachedto the mobile phone and has changed itsbuying patterns altogether. Cellular operatorsoffered more than the traditional voiceservice that has made the mobile device morethan just a phone. SMS growth in thePhilippines is driven by content providerapplications. It is all about bringing thecontent within reach of the mobile phoneuser anytime, anywhere.

In our Filipino Online Shopper Report, thetop VAS rankings caught attention andcontention. Although logos and icons topour list, in our revised survey, we beganasking how often do they access it? Majoritydo for one to two times a month. News canbe considered as our application leader interms of being used on a regular basis. Ourfrequency report per VAS application is veryraw at this stage but it will significantlyimprove as we gather more data.

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Distribution of Mobile Usersusing VAS

0 5 10 5 0 5

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Mobile Users using VAS

0 20 40 60 80 100

71% of our respondents are frequent users of valueadded services (VAS) such as logos, icons, picturemessages, among others.

Percent (%)

VAS

Logos & IconsRingtones

Picture MessagesNews

HoroscopeQuotesJokes

SportsGames

BankingBiorhythm

Celebrity NewsLocation Finder

Gig SchedsShopping

ForexChat

RecipesMoviesEmail

Popularity of Value-Added Services

0 5 10 5 0

VALUE ADDEDSERVICES(VAS)

Percent (%)

Freq

uenc

y

Once a MonthOnce a Week

Twice a MonthTwice a Year

DailyTwice a Week

Once Only8 X a Year

3 X a Month

Ringtones - Frequency

0 5 0 15 20 25

7

Percent (%)

Freq

uenc

y

DailyOnce a Week

Once only2 X a Month

Once a Month3 X a Week

News - Frequency

0 10 20 30 40 50 60

Percent (%)

Freq

uenc

y

Twice a MonthOnce a Month

3 X a Week3 X a yearOnce only

Once a WeekDaily

2 X a Week2 X a Year

4 X a Week3 X a Month

Picture Messages - Frequency

0 5 10 15 20 25 30 35 40

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

News

0 5 0 15 20

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Picture Messages

0 5 10 5 0 5 0

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Horoscope

0 5 10 15 20 25 30 35 40

Percent (%)

Freq

uenc

y Once a WeekDaily

2 X a MonthOnce a Month

Jokes

0 5 10 5 0 5 0 5

Percent (%)Ag

e Gr

oup

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Quote of the Day

0 5 10 5 0 5 0

Percent (%)

Age

Grou

p

16 and below17-2021-2425-2829-3233-3637-4041-4546-55

56 and up

Sports

0 5 10 5 0 5 0

The current demand for wireless applicationsspurred a new area of focus for the softwaredevelopment sector. Some of the players inthis area are:

SMS GATEWAYXurpas

(http://www.xurpas.com/)Wolfpac

(http://www.wolfpac.net/)Exceed Solutions

(http://www.exceedsi.com/)

APPLICATIONSSoftrigger Interactive

(http://www.softrigger.com/)GiveMe Unlimited

(http://www.givemeunlimited.com/)Fluxion

(http://www.fluxion.com.ph/)iAyala

(http://www.iayala.com/)Wireless Works

(http://www.wirelessworks.ph/)Sequel Solutions

(http://www.sequelsolutions.com/)Personalized Greetings(http://www.pgi.ph/)

i-Quanxi.com(http://www.i-quanxi.com/)

DotEnable(http://www.dotenable.com/)

Colibria(http://www.colibria.com/)

Philippine and Scandinavian IT Services(http://www.philscan.com/)

Systema(http://www.systemacorp.com/)

MESSAGINGMobile-Arts

(http://www.mobile-arts.com/)Chikka

(http://www.chikka.com/)DFNN

(http://www.dfnn.net/)25by8

(http://www.25by8.com/)stag Philippines

(http://www.stagphil.com/)

GAMINGimGAME

(http://www.imgame.com.ph/)

LOCATION-BASED SERVICESWebcast Technologies

(http://www.findme.com.ph/)Asian Navigation Tracking Service

(http://www.ants.ph/)

WIRELESS APPLICATIONDEVELOPERS

1 2 2

1 2 2 3 3

1 2 2

1 2 2

1 2

1

1

1 2 2 3

1 2 2 3 3

1 2 2 3

1 2 2 3


MOBILE PHONE USER HABITS BY AGE GROUP

• 20 text messages sent per day. • Spends an average of P1037 per month

The growth of wireless applications can be attributed to several factors. Filipinos are known to be very social and friendly therefore making communication offerings an immediate click. A lot of idle time is wasted as well in traffic. During these waiting hours, the mobile phone is used extensively to keep one occupied and in touch. Cellular operators’ aggressiveness in increasing its VAS revenue is driving its strategy to continuously seek for killer applications.

For this report, we tried to come up with a breakdown of each age group mobile phone usage habits. May it guide you in designing applications and understanding what clicks for each age group.

The number of mobile phone subscribers is expected to reach 18 million in 2003. The continuous growth trends make carriers and application service providers creative in its service offering and have it accessible to the simplest phone.

As wireless applications are considered to be unique and new, application developers specializing in this field can avail as well of government incentives in pioneering projects.

SMS applications are very promising and popular in all ages because of its simplicity and accessibility. As applications become more useful, fun, and productive, achieving market share domination will be competitive. Revenue-sharing agreement between the carriers and WAD must be improved. The current 80%-20% scheme in favor of the carrier may become its major disadvantage in the long run. China carriers, for instance, are following Japan’s model in giving the higher share of the revenue to the WAD.

Innovative and revolutionary mobile phone Internet applications are also needed as the Computer Industry Almanac predicts that 48% of Internet users will use wireless technologies to connect to it by 2005. Uptake for mobile portals may happen sooner than we think.

GPRS AND MMS

As early as April 2001, infrastructure for GPRS has been put up. However, with the unavailability of handset, GPRS is being rolled out gradually. GPRS service was first offered for free and a limited number of users satisfied with the offering. 3G on the hand won’t happen that soon as spectrum licensing issues, infrastructure cost, affordable handset availability are hampering its implementation.

Multimedia Messaging Service (MMS) offerings has begun from both Globe and Smart. Although this service is limited to a few handsets, it is predicted to change the way we use VAS. We'll cover this in greater detail in future reports as it reach maturity and acceptance in the community.

CONCLUSION

The mobile phone plays an important role in bridging the digital divide in the Philippines as various Internet applications were made accessible to the mobile phone despite its limitations.

Filipinos, young and old, became more appreciative of information technology and has offered earning opportunities for micro and small application developers.

Creative and daring entrepreneurs in this marketplace can gain wealth if they play their cards right.

• Nokia 3310 most popular mobile phone • 60% - Smart subscribers • 40% - Globe • Average of 20 text messages a day.

Percent (%)

VAS

Logos & Icons Ringtones

Picture Messages Jokes

Horoscope Biorhythm

News Quotes

Celebrity News Banking

Location Finder Gig Scheds Shopping

Chat

16 and Below

0 5 10 5 0 1 2

4 STATSREPORT

• Nokia 3210 most popular mobile phone • 71% - Smart subscribers

24% - Globe 5% - Talk & Text

• Average of 21 text messages a day • Spends P640 per month on cellular

payments • 100% prepaid

Percent (%)

VAS

Ringtones Logos & Icons

Picture Messages Horoscope

Jokes Quotes

News Sports

Gig Scheds Celebrity News

Games Shopping

Biorhythm Recipes

17 to 20

0 5 10 5 0

Percent (%)

VAS


Picture Messages Horoscope

Sports Quotes

News Games

Gig Scheds Biorhythm

Banking Location Finder Celebrity News

Shopping Chat

Recipes Movies Email

21 to 24

0 5 10 5 0 5

• Nokia 3310 most popular mobile phone • 49% - Smart subscribers • 47% - Globe • 1% - Mobiline

1% - TouchMobile 1% - Talk N’ Text


payments • 90% prepaid, 10% postpaid

5

Percent (%)

VAS


Picture Messages News Jokes

Quotes Horoscope Gig Scheds

Sports Games

Biorhythm Banking

Celebrity News Location Finder

Shopping Email

Movies Recipes

Chat Forex

25 to 28

0 5 10 5 0

• Nokia 3210 most popular mobile phone • 68% - Globe subscribers

32% - Smart • Average of 16 text messages a day • Spends P667 per month on cellular



43% - Smart 1% - TouchMobile

• Average of 25 text messages a day. • Spends P998 per month on cellular

payments. • 69% prepaid, 31% postpaid

Percent (%)VA

S


Picture Messages News

Banking Games Quotes

Location Finder Sports

Celebrity News Horoscope Biorhythm

Gigi Scheds Shopping

Jokes Email

Traffic Forex

Recipes Movies

29 to 32

0 5 10 5 0 5

Percent (%)

VAS


News Picture Messages

Jokes Games

Banking Horoscope

Quotes Location Finder

Biorhythm Gig Scheds Shopping

Forex Recipes

Chat Stocks

33 to 36

0 5 10 5 0


28% - Smart 2% - TouchMobile


payments • 79% prepaid, 21 postpaid

Percent (%)

VAS



Sports Banking Quotes

Location Finder Shopping

Games Celebrity News

Jokes Email

46 to 55

0 5 0 15 20 25


39% - Smart 3% - Talk N’ Text



Percent (%)

VAS



Games Quotes Sports

Banking Celebrity News

Shopping Forex Jokes Email

Traffic Chat

Shopping Location Finder

Info-on-Demand

41 to 45

0 5 10 5 0 5 0


27% - Smart • Average of 18 text messages a day • Spends P2459 per month on cellular

payments • 67% postpaid, 33% prepaid

Percent (%)

VAS



Horoscopes Games Jokes

Sports Banking

Chat Forex

Shopping Location Finder

Quotes Info-on-Demand

37 to 40

0 5 10 5 0 5


24% - Smart 2% - Talk N’ Text

• Average of 17 text messages a day. • Spends P1067 per month on cellular

payments. • 67% postpaid, 33% prepaid

Percent (%)

VAS Ringtones

Logos & Icons Picture Messages

56 and Up

0 10 20 30 40 50

• Nokia 8210 most popular mobile phone • 50% - Smart subscribers

50% - Globe • Average of 1 text messages a day.

1 2

1 2 2

1 2

1 2 2

1 2

1

1 2 2 3

1 2 2

Documents

Filipino Mobile Phone User Report - DigitalFilipino StatsReport (2nd issue)