In terms of television advertising revenues, two major broadcast networks in the Philippines stand to benefit from the recent non-renewal by Congress of the legislative franchise of the ABS-CBN broadcasting empire. They are the ABC Network (which operates TV Channel 5) and the GMA Network (which runs TV Channel 7).
During the years before the franchise of ABS-CBN expired in May 2020, ABS-CBN and GMA were rivals for radio and television supremacy in the Philippines. Because of its late participation in the broadcast industry in the country, ABC was a far third placer.
All three networks are regulated by the National Telecommunications Commission (NTC) and, with respect to TV broadcasts, the Movie and Television Review and Classification Board. They were all members of the Kapisanan ng mga Brodkaster ng Pilipinas (KBP), but GMA bolted the KBP in 2003.
Under the current regulations of the KBP, its member-stations are not allowed to overload on TV advertising spots (more popularly known as commercials) for every broadcast hour.
The purpose behind the advertising volume restriction is to maintain the balance between TV as a source of popular information and entertainment, and TV as a source of revenue for the network.
Broadcasting requires the use of the airwaves via the ionosphere, which belongs to the State. By regulating the volume of TV advertising spots per broadcast hour, TV keeps its audience appeal, and remains a steady source of revenues for network owners.
More specifically, too many advertisements on TV may lead to a drastic change in audience behavior. Longer segments for commercials encourage audiences to take longer breaks away from the TV monitor (trips to the comfort room, refrigerator-side snacks, telephone calls, etc.). In the long run, less and less people will get to watch advertisements, and sponsors will end up shortchanged.
An overload in advertising spots will make audiences lose interest in TV. If that happens, sponsors will cease to advertise and the TV industry as we know it will collapse.
Decades ago, ABS-CBN Channel 2 obtained the license to broadcast live via satellite a world heavyweight boxing match. The network got a windfall of sponsors to buy advertising spots for both the live telecast and the evening prime time replay. To the unpleasant surprise of network management, the boxing match ended early when one of the prize fighters got knocked out in the first round.
That outcome notwithstanding, ABC-CBN went on to air all advertising spots it contracted, both after the fight was over, and hours before the evening prime time replay. For that infraction of the KBP rules, ABS-CBN was made to pay an administrative fine.
Since then, the KBP strictly monitors commercial overloading among its members-stations.
It appears that GMA left the KBP over the issue of commercial overloading. GMA did not want to be restricted on the matter of advertising spots in its TV programming.
During the years before May 2020, GMA programs were known for the seemingly endless advertisements during its commercial breaks. Observers noticed that on many occasions, the volume of commercials is so large that the actual program gets marginalized by the advertisements, and that some live programs have to be reset to the following day for lack of available airtime.
After ABS-CBN went off the air in May 2020, observers noted the substantial increase in what was already considered as saturated commercial advertising on GMA. The KBP is unable to do anything about it because GMA is not a member of the association.
Accordingly, the NTC should step in and regulate the volume of commercial advertising not just in GMA but in all TV networks, including those which are not members of the KBP. The NTC is mandated by law to make sure that broadcast activities are in the public interest. It is not in the public interest if networks engage in advertising overloading.
As long as the NTC does not regulate advertising content, any regulation it issues against TV advertising overloading will be legally sustainable.