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SUNDAY, APRIL 23, 2017
Business
Ray S. Eñano, Editor / Roderick dela Cruz, Issue Editor business@thestandard.com.ph
ZALORA SUPPORTS ASIAN DESIGNERS
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By Othel V. Campos ZALORA’S Private Label marks its third year with strong collaboration with Asian designers. Zalora Asia head of marketing Rayne Reid says the electronic commerce market of the Philippines and other Southeast Asian countries experiences a growth in “online transactions across the region” that drives Zalora’s reach. “We move very fast in fashion. That is always an interesting part of the Private Label. We’re very committed about our customers across Southeast Asia. We try to bring the latest fashion and also familiar favorites,” she says. By familiar favorites, Reid is referring to global fashion brands that consumers grew up with and mid to expensive fashion labels that found a home in the Zalora platform.
IP PROTECTORS. The Philippines celebrates the National Intellectual Property Rights Month in April. Leading the celebration are (from left) US Embassy Manila trade officer Brian Breuhaus, Intellectual Property Office of the Philippines director-general Josephine Santiago, Philippine Association of the Record Industry Inc. chairperson Marivic Benedicto and iflix country manager Sherwin dela Cruz.
MOBILE APPS RESCUE PH MUSIC INDUSTRY
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OBILE applications are giving music and entertainment pirates a dose of their own
A music industry executive says mobile apps have come to the rescue of the Philippine music and entertainment industry from digital pirates by offering a strong price point at P129 a month for an unlimited access to songs and movies, beating the cost of pirated items. “I think embracing innovation is really the key to defeating piracy,” says Philippine Association of the Record Industry Inc. chairperson Marivic Benedicto, who is also the head of Music Publishing and New Media for Music at ABS-CBN Film Productions Inc. Benedicto says mobile platforms Spotify, Youtube and iflix are giving the music and entertainment industry a second wind and an opportunity to recoup the amount it is losing to pirates or intellectual property thieves. “With Spotify and Youtube, and eventually Facebook being monetized, we are looking at going back to where the record industry was, in terms of investing in new artists and song writers,” Benedicto says in a news briefing in Makati City during the celebration of the World Intellectual Property Day. “I think Spotify has reduced music piracy by 95 percent,” she says, adding that Spotify is now the preferred music platform of millennials, because of its mobile-first design and multiple-screen features. The key, she says, is the P129-a-month price point. “That is a good start. Iflix followed with P129-amonth offering. It seems to be an effective price point. Now, the Philippines is the fastest growing market for Spotify. We also rank No. 14 among Spotify markets in the world,” says Benedicto.
Benedicto says Spotify gives about 70 percent of its earnings to content providers, which is shared by the record label, composers and song writers. She says Youtube also gives out 55 percent of its earnings to content providers. “What’s P129 versus buying four DVDs for P100. You pay P129 a month and you get 21,000 hours of content on iflix and thousands of songs on Spotify. In a CD, there are only 100 songs or MP3s. And there is no parallel between pirated experience and legitimate source,” she says. Benedicto says Spotify particularly changed the industry and gave Filipinos a legitimate platform to access music digitally. “People now don’t bother to go to pirate sites, because Spotify is also free, although it has a premium model at P129 a month. With Spotify having no borders and published worldwide, the Filipino music has been discovered in other territories. We have a few artists who are being listened to in countries like Taiwan and Malaysia. Of course, it is not yet like the 1980s, but we are already starting to get back the revenues, get back the investments. Record labels are having more courage to develop, to invest in new genres. It is helping artists a lot, because it is a borderless platform. You can get discovered everywhere,” she says. “Last year, the International Federation of the Phonographic Industry declared there was no longer music piracy. Of course, there still is, but it is no longer a significant issue, because everybody is now on the legitimate platform like Spotify and Youtube,” Benedicto says. Sherwin dela Cruz, the country manager of iflix, says the subscription video-on-demand service also changed the consumption of entertainment content and gives people a better viewing experience than those offered by pirate sites. “We really had to pinpoint a good pricing so that we can really scale. For us, the price we offer in the Philippines is P129,” says dela Cruz, adding that the subscription fee gives users 21,000 hours of high-
resolution content on iflix, compared to P100 for just three or four DVDs of pirated movies. “I am happy to announce that so far, we had 1.2 billion minutes streamed on the site,” dela Cruz says. “I firmly believe that we can offer a better service, we can offer more choices, we can offer more content at a price that people do not really mind. Piracy is not actually free. People actually pay for it, like in the cost of CDs. It is just going to the wrong pockets,” says dela Cruz. Benedicto, however, concedes that composers would never be able to experience what they had in the 1980s. “A gold record used to be 90,000 units in the late 1990s. Now, it is down to 7,500 units. We now have one legal replicating plant in the Philippines. There used to be four. SM has already removed the record bars in its department stores,” Benedicto says. Data from the Philippine Association of the Record Industry Inc. show that the Philippine music industry had total sales volume of 791,310 with trade value of P159.916 million in 2016. Benedicto says the industry began to accept that the way people consume music is changing. She says this is why players in the music industry cooperated and gave Spotify a try in 2014. “We talked and agreed to their terms to see how it works and take it from there. Spotify offered a minimum guarantee for the country which at first was very small. After two years, the minimum guarantee they are offering now is 15 times that amount. You can see how the market grew in the last two years,” says Benedicto. “We were skeptical at first, but we saw how it could help address the problem of piracy. We are number 14 now in the world in terms of the number of subscribers at Spotify. The Spotify model was so successful because it was not very far removed from the experience of the consumer. They were getting it for free, and it is 100-percent legal,” she says. Wilson Tieng, president of Solar Entertainment Corp., says IP thieves still make millions from Turn to C2
HONG KONG PUBLICATION NAMES BEST FILIPINO CEO Globe Telecom president and chief executive Ernest Cu is recognized the best CEO in the Philippines.
GLOBE Telecom president and chief executive Ernest Cu was recognized as the Philippines’ best CEO by FinanceAsia, a Hong Kong-based magazine. Globe also ranked as the third Best Managed Company in the country and was cited in several other categories. FinanceAsia, a leading publisher of financial news in the Asia Pacific region, said Cu bagged the top spot in the Best CEO category with 23 points. Globe also placed third in Best at Investor Relations, fourth in Best at Corporate Social Responsibility and sixth in Most Commitment to Corporate Governance. The citations were based on a survey
conducted by FinanceAsia involving investors on their views on which listed companies around Asia they consider to be best managed, with the best senior executives. FinanceAsia received responses from 180 portfolio managers and buy-side analysts from around the world. FinanceAsia is a member of the Haymarket Media Group and covers investment banking, capital markets and strategic corporate finance. “The host of citations from FinanceAsia underscores our commitment to achieve remarkable results not only in terms of financial performance but also in adhering to the principles of good corporate governance, corporate social responsibility and investor
relations. I am deeply honored that Globe has been recognized for our remarkable efforts in the industry,” said Cu. Cu said the recent success of Globe was at the heels of the company’s purposeled transformation to become a better organization ready for the future. Anchored on its corporate vision of leading a Philippines where families’ dreams come true, businesses flourish and the nation is admired, the company defined its purpose moving forward to treat people right by creating a Globe of Good. Globe aspires to be an industry leader with purpose, helping customers discover new ways to enjoy life.
Zalora Asia head of marketing Rayne Reid At the second Philippines Zalora Style Awards Night, Reid discussed how Zalora managed to merge more than 10 instore brands into six uniquely different styles for women and two for men, forming the core fashion basics of the Private Label. The core labels are Zalora Women label and Zalora Men label. There is also a trendy and hip vibe for the young adults called Something Borrowed. Private Label operates in six markets—Singapore, Malaysia, Indonesia, Hong Kong, Taiwan and the Philippines. “We try to cover all of these markets in different and interesting ways for the fashion customer. In Southeast Asia, we always have summer time and the subtropical vibe. Whether it is through our styling or our fabrication or through having constant color and prints, we can really make a difference for our customers. We also focus on specific fit in Southeast Asia, basically a petite market especially for women,” she says. “Fashion right now is all about opu l e n c e — e m b e l l i s h m e nt s , beadings, color stories that are vey rich. We’re loving right now all the textures of velvet, embroidered meshes as well as simplified lines coming through tailored silhouettes easy for everyone to wear,” Reid says. Zalora has an exclusive design studio in Singapore, with a mix of all nationalities between Americans and Europeans and a strong group of Southeast Asian designers from Singapore, Indonesia and Malaysia. Reid is excited over the prospect of getting on board Filipino designers. “We have Filipino buyers in the buying team. We manufacture across the region— China, Indonesia and Malaysia. We’re always looking for new vendors. We believe strongly in vendor development. Where we see good partnership either with the brand or the manufacturers. We’re always s eeking t hos e opportunities. We spoke with the Philippine team about the strong brand relationships that Zalora has created here. And how that strong partnership brings the brand to Filipino customers,” she says.