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Why is the CICT abandoning the Moblie Application Developers?

May 15, 2005

In this IT Matters report (which I chanced upon in Migs Paraz’s blog), CICT Chair Virgilio Pena declared his commission will have a hands-off policy with respect to the problems faced by local mobile applications developers vis-a-vis the onerous business arrangements imposed upon them by the dominant mobile phone companies, the “Cellcos”. 

He added that the government should not interfere in the profit sharing scheme through regulation.

Mr. Pena’s indifference to this sector is distressing because this industry creates significant value-added in the ICT sector and has the potential to compete in the global market if it can get out from under the thumb the Cellcos.  CICT should protect this industry and promote it with the same vigor as the low-value-added call center industry.  CICT should intervene and break this market failure.  There is absolutely no reason to take a hands-off policy that benefits the Cellcos. 

Here’s the problem: Mobile application developers provide services to the general public through the Cellcos’ SMS and MMS network.  Some make ringtones while others route SMS to your email and back.  With over 1 billion SMS/MMS messages routed in this country every 9 to 10 days or so, Philippine mobile application developers have a unique opportunity to test their services upon a large market, make some money and then offer their services to the rest of the world.  However, few of these companies have been able to do so.  The reason is simple,  the Cellcos have imposed onerous business conditions upon these mobile application developers which are designed to maximize the Cellcos’ profits at the expense of these developers. (more…)

Posted by JJ Disini at 4:10 pm | permalink | Add comment