When IT digs toward mining

CEO of Philippine IT conglomerate IPVG, Enrique Y. Gonzalez, explains his voyage into mining and stresses he still believes "in the power of IT to profoundly change the world".
Written by Melvin G. Calimag, Contributor

The current IT issue raging here in the Philippines is about the Cybercrime Prevention Act, which took effect Sept. 27, 15 days after Pres. Benigno S. Aquino III signed and subsequently published it in the government's Official Gazette.

Some provisions of the law, particularly on online libel, have riled many sectors and a number of petitions questioning its constitutionality have been brought before the Philippine Supreme Court. At the time of this posting, four petitions have already been filed at the tribunal, with one more coming up today, and another next week.

Since the story is still developing, I'd like to reserve my comments on this topic for my next blog post. Meanwhile, allow me to take up again the previous subject I tackled in my previous post--about a local IT conglomerate drifting slowly toward mining.

Mining, I must say, remains to be a very sensitive here in the Philippines. One of the country's richest businessmen, Manny V. Pangilinan, recently severed his professional ties with his alma mater, the Ateneo de Manila University, over policy differences on the issue of mining.

One of Pangilinan's companies, in fact, recently put out an advertisement that highlighted the role of mining in the development of the ICT industry. If a person is a mobile phone user, the ad claimed, he or she must be a supporter of mining since most of the components used in making a cellphone are taken from mining activities.

That argument sounds too simplistic to me. But, I won't go to great lengths dissecting this issue at this point. Instead, I'm publishing the e-mail that Enrique Y. Gonzalez, sent to me in response to my previous article.

Here is his letter in full:

Hi Melvin,

Thanks for featuring me in your latest article "Is IPVG's change of heart the right beat?". I remember you frequently covered IPVG, EGames and Cloud, and have always been one of our friends in the media. I thought I would reach out to you to inject clarity in the diversification undertaken by our group. I wanted to do this by focusing on several key points:

Once in IT, Always in IT.

I've always believed and continue to believe in the power of IT and its ability to profoundly change the World around us. My first Company (fresh out of college) was an internet start-up in Boston. I decided to move back to Manila in 2000 to promote the adoption of the internet and IT as a means of helping the country modernize. My company then developed websites for free (in exchange for share of online ad revenue) for various media entities including TODAY, Pinoy Times, the Philippine Post, What's on Expat, and the Free Press. I worked with my cousin, Edsamail founder Marco Y. Santos in Edsamail, which provided free internet to its user base! I then applied the same free proposition to Egames which became the #1 online games company.

Needless to say I've come a long way from then! We do continue to apply IT as a competitive differentiator and in support of a value proposition across the various sectors we have established business interests.

 From Infancy to Adulthood

I set-up the IP Group to incubate start-ups, grow them to maturity, and pass that business onto a strategic partner that could take it to the next level. This is the natural evolution and life-cyle of such endeavors.

In all previous divestments (call center to PCCW, Prolexic to Kennet Partners, Egames merger with Level-up) we retained or continue to retain a substantial minority interest after the initial deal with our new partner. Due to the dynamics of our industry, and the reshaping of the competitive landscape, we must continuously pursue decisions that are in line with what is best for our shareholders, and more importantly best for the business/company. This often includes passing the Company onto a strategic partner.

We will only pass control onto a group that we believe is the right partner that can ensure the continued success of that business. PCCW, Kennet Partners, and MIH/Tencent are all world class companies and partners.

We recently accepted Softbank (Bodhi Fund) as an investor into IP Group which ensures our group maintains a strategic interest in technology.

I am an Entrepreneur first, IT person second.

As I saturated opportunities in local IT market, I had an epiphany. I realized I could step outside the box. The "box" was IT. I realized this during my second year attending Harvard OPM.

As an entrepreneur my driving motivation is to "do it better." My development as an entrepreneur has allowed me to enter other industries successfully.

I'm proud to say I have established businesses and investments in F&B, Real Estate, Mining, and Financial Services. We still continue to hold major interests in online gaming, internet cafe, and data centers. Some of our recent activities including serving as the Philippine partner of NBA.com, Take-2, Blizzard, and Highlands Coffee (all major brands or global companies).

Changing our Country, and making an impact on the World.

I firmly believe responsible mining is one way for the Philippines to climb from developing, to developed status. Due to the sheer demand of commodities, and existence of natural resources in the Philippines, mining will happen. The question is whether the local companies doing so will operate and hold itself onto a higher standard with a real intent to enrich the lives of local communities, and protect the environment. I enter the mining industry with this mind-set and intent. I've decided to pursue this sector as I feel obligated to do so to ensure that I can be a positive force in this industry. Our country needs it.


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