Economic network

Network rivals team is considered ‘non-competitive’

The purchase of former media giant ABS-CBN by rival TV5 Network will not lessen competition between them, local think tank Infrawatch PH believes.

ABS-CBN acquired a nearly 35% stake in TV5, owned by business tycoon Manuel Pangilinan, last Thursday for 2.16 billion pesos.

The flagship of the Lopez media conglomerate can increase its share to 49.92% after eight years, if it wishes.

In return, Cignal Cable, a subsidiary of Pangilinan-owned pay-TV provider Cignal TV, will acquire 38.88% of SkyCable from ABS-CBN, Lopez Inc. and Sky Vision Corp. for 2.465 billion pesos, with an option to bump it up. to 4.388 billion pula after eight years.

The deals between the two media entities totaled around 11 billion pesos.

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In a statement, Infrawatch PH head Terry Ridon said the partnership between ABS-CBN and TV5 is a testament to the enduring quality of content produced by the “Kapamilya” network, which remained at the forefront despite its closure in 2020.

Ridon said it’s also a leap forward for TV5, as it can now compete with the nation’s broadcast leader, GMA Network, in ad revenue, talent and programming.

He said the deal was not a “franchise issue” because there was no transfer of controlling interests that required congressional approval.

Ridon believes that opponents of ABS-CBN “at all levels of government” will “sabotage” the partnership.

Some members of Congress are already pushing for an investigation into the deal.

Sagip representative Rodante Marcoleta called on the National Telecommunications Commission (NTC), the Philippine Competition Commission (PhCC) and other government agencies to analyze the ABS-CBN-TV5 partnership for violations.

But Ridon said Congress “should focus on larger public concerns, such as economic recovery and social programs, instead of wasting time inquiring about content-sharing agreements between media entities.”

He said the PhCC had no reason to cancel the deal for being anti-competitive because it does not involve a transaction that would lessen or limit competition.

“In fact, when ABS-CBN lost its franchise in 2020, it ceased to be the dominant player in the broadcast segment, and TV5 has yet to achieve dominant status in the same industry,” said Ridon said.

He urged rivals-turned-partners to conduct a voluntary review, given the size of the deal and the entities involved.

The review is not mandatory, since the deal falls below the 50 billion peso threshold to merit such an assessment, Ridon said.

In a statement, PhCC chairman Johannes Bernabe said he may ask the agency’s mergers and acquisitions office to consider whether effects involving transactions between TV5 and ABS-CBN and Cignal and SkyCable would warrant a motu propio review.

“A review of the merger will determine whether the transaction may result in a substantial lessening of competition in the affected markets,” Bernabe said.

In an interview with Cignal-owned One News on Thursday night, Mediaquest Holdings president Jane Jimenez Basas said the group welcomes any investigation into the deal.

Mediaquest is the media holding of the PLDT group owned by its Beneficial Trust Fund.

“We welcome any investigation as we are confident that this transaction complies with all relevant Philippine laws and regulations,” Basas said.

She said that for now, the bulk of the partnership will focus on improving TV5’s entertainment content as well as its regional reach.

“We want to make sure that we carry the best entertainment programs and that we improve the attractiveness of our network (TV5)… At the end of the day, we believe that ABS-CBN is the right partner, they are the best in the field of entertainment production, they have the best talent and provide better entertainment content to Filipinos,” Basas said.

The Kapisanan ng mga Brodkaster ng Pilipinas (KBP) also welcomed the deal, calling it an “antidote” to the current “monopoly” enjoyed by GMA.

“It should open up to healthier competition,” KBP chairman Herman Basbano said.