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A TV industry without ABS-CBN

“The government should encourage qualified Filipinos to invest in the TV business and take over the void in the TV industry once the ABS-CBN legislative franchise expires.

Concept News Central

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The expiration of the legislative franchise of the ABS-CBN broadcasting network is a month away, and from all indications emanating from Congress, a renewal of the franchise seems rather unlikely.

President Rodrigo Roa Duterte has repeatedly announced that he is against the renewal of the ABS-CBN franchise. So even if Congress, despite the unrealistically little time it has, manages to enact legislation renewing the franchise, President Duterte can still put that to naught by exercising his constitutional power to veto or disapprove the same.

Then there is the quo warranto case filed by Solicitor General Jose Calida in the Supreme Court which seeks the outright cancellation of the expiring franchise.

So what happens to the television industry in the Philippines without ABS-CBN in the picture?

From the perspective of media freedom, there seems to be no reason for civil libertarians to worry. ABS-CBN is not the only TV station around. News and news commentaries will still be disseminated in the country mainly by the two other major private broadcast networks around, namely, ABC-TV 5 and GMA-TV 7.

Since both TV networks have news dissemination links with major daily newspapers (which do not need a legislative franchise to operate), it is doubtful if the quality of the broadcast news reportage will deteriorate once ABS-CBN bolts the TV industry.

In the event that ABS-CBN is out, ABC and GMA will most likely compete with each other to capture as big a share as possible of the news-seeking audience left by ABS-CBN.

At any rate, the massive responsibility of news dissemination which ABC and GMA will inherit should the ABS-CBN franchise renewal efforts fail, will be complemented by independent local broadcast news sources such as Cable News Network Philippines and other local cable TV stations that also air independent news programs and commentaries. Under such circumstances, it is unlikely that the quality of independent news dissemination in the country will deteriorate once ABS-CBN departs.

As for the potential problem of unemployment, labor relations experts say that the displacement of ABS-CBN personnel will be temporary. Since ABC and GMA are bound to expand their businesses should ABS-CBN close shop, the displaced but experienced ABS-CBN workers may be easily assimilated by the expanding two. The savings to be realized in hiring experienced workers instead of spending long training hours on new hires, will mean a brief period of unemployment for many.

Most of the high-end talents and mainstays of ABS-CBN will probably end up joining ABC or GMA. Since the advent of the TV industry in the Philippines, many TV personalities transferred from one network to another, depending on which station offers the better deal, or on who needs a job very badly.

Actually, the biggest concern that will arise in a broadcast industry playing field without ABS-CBN competing is about industry economics.

Advertising industry leaders know that competition between and among the three major TV networks makes advertising rates stable and affordable. They also know that once the competition is diluted, like when it is limited to two TV networks, big time corporate advertisers may have to put up with a geometric increase in the cost of advertising spots (or commercials as they are popularly known).

With advertising expenses computed as part of overhead costs in the production of consumer goods, an increase in advertising rates means higher acquisition costs for many consumer products.
Another possible scenario involving broadcast economics involves corporate combinations in restraint of trade. With ABS-CBN out of the economic equation, a merger of ABC and GMA may be a tempting prospect for their respective owners.

Although the Constitution prohibits monopolies in commercial mass media, and forbids business combinations that restrain trade, it can be argued that ABC and GMA cannot be faulted if there is no third player in the local television industry. Crafty lawyers can also work out other legal arguments.

In the long run, while it is the discretion of President Duterte and Congress not to renew the legislative franchise of ABS-CBN, the public interest will have to be protected from the possibility of a virtual monopoly by the remaining networks. Thus, the government should encourage qualified Filipinos to invest in the TV business and take over the void in the TV industry once the ABS-CBN legislative franchise expires.

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