I.

INTRODUCTION

A. Historical Background

The concept and name, Cyber Café, was invented in early 1994 by a person name Ivan

Pope. He was commissioned to develop an Internet Weekend Arts Event held over the weekend

at the Institute of Contemporary Arts located in Central London. Ivan Pope presented a proposal

outlining the concept of a Coffee Shop with Internet Connectivity using several desktop

computers placed on the tables for people visiting the Coffee Shop to use for browsing internet,

check emails etc. The event took place over the weekend in the middle of March 1994 for two

consecutive days beginning 12 and ended on the 13 of March 1994. Around June 1994, Canadian

first Internet Cafe was opened in Toronto, Canada known as Binary Cafe. Two months later in

August 1994 an American man name Jeff Anderson opened his first American Cyber Cafe in

Dallas, Texas USA known as High Tech Cafe and later followed by another two Internet Cafe in

the New York City and East Village in beginning of 1995.

Inspired partly by the ICA event, a commercial establishment of this type, called Cyberia,

opened on September 1, 1994 in London, England. Suba Internet Center, the first American

Internet cafe, opened in April 1995 in Chicago, Illinois.

When talking to industry experts, the number of Internet cafes are currently pegged at

8000 to 14,000 all over the country. Most are surviving by offering more than just your

traditional Internet rental service. Others are offering scanning, desktop publishing, gaming,

encoding, research, among others. I believe that there shall be changes in the Internet cafe market

within a year or two as the not so well-funded players, who rely on pirated software, will be

more pressured to go legitimate as their competitors are the ones who report them. Microsoft is

now actively educating the market with its Internet Cafe Rental Rights program to ensure that
these places operate legitimately in using their products. Although there's nothing stopping

Internet cafe players to use open source. Gaming is one popular activity in Internet cafes. Like

in China, there are now Filipino gold farmers in these gaming communities who sells account

identities or charge a fee for playing another person's account to reach a particular level.

The use of Internet cafe by the youth has also elicited a lot of reaction from the local government

units. Some even issued local regulation to ban minors from going to Internet cafes during school

hours. Roberto Verzola'sexperience in this area drives the point to its necessity.

Another expansion approach that some Internet cafes are now pursuing is to function as a call

center, or rent its facilities out for such use, like Netopia. Companies like PLDT are also making

the internet cafe an option that new entrepreneurs can look into.

On the advocacy side, there are now groups who sees the Internet cafe as a place where their

philantrophy work can be deployed. With the maturing Internet sector, the Internet cafe owners

appear to be the most organized and even strategically quantifiable as most cities in the country

have been establishing one. Some of these associations are: Internet Cafe Association of the

Philippines, Internet Cafe Association of Cebu, among others. The foundations of the Internet

were formed when packet-switching networks came into operation in the 1960s. Transmitted

data is broken up into small packets of data, sent to its destination, and reassembled at the other

side. This means that a single signal can be routed to multiple users, and an interrupted packet

may be re-sent without loss of transmission. Packets can be compressed for speed

and encrypted for security. Computers at the time were massive, primitive structures. The only

type of network in operation before was made up of terminals that logged into mainframes. This

is similar to the present-day client/server relationship we have with the modern Internet, except
the computers are usually comparable in terms of power, and so the Internet is known as a peer-

to-peer system.