ABS-CBN NOT THREATENED BY POSSIBLE GMA7-TV5
MERGER
MANILA, JUNE 22, 2012
(ABS-CBN) By Cathy Rose A. Garcia - Media giant ABS-CBN Corp. is
not threatened by the possible merger of its rivals GMA Network Inc. and
Associated Broadcasting Company (ABC), operator of TV5.
Eugenio L. Lopez III, chairman and chief executive officer of ABS-CBN, said
he does not think a possible GMA7-TV5 merger would change the landscape of the
industry.
[PHOTO -Eugenio L. Lopez III, chairman and chief executive officer of
ABS-CBN (right), talks to Ma. Rosario "Charo" Santos-Concio, ABS-CBN president
and chief operating officer, during the company's annual stockholders' meeting
on Thursday. Photo by Fernando Sepe, Jr. for ABS-CBNnews.com]
"It doesn't change what we have to do. We're very focused on our own
strategy. The number of channels that we have to compete against remains the
same. As far as we're concerned, we just have to execute and we'll be okay," he
said, in a press conference after the company's stockholder's meeting.
Business tycoon Manuel V. Pangilinan, who owns ABC, earlier said a deal to
invest in GMA Network Inc. may be finalized within the year. The move is widely
expected to result in the merger of the 2 networks, which will compete directly
against ABS-CBN.
"Combining channels, programs is not going to lead to giving you an
inordinate structural advantage. We are competing not only against channels but
internet, hundreds of channels. It makes no difference to me if there's one
owner or a hundred owners, we're still competing against all of them. That will
not change regardless of what the equity structure is of those companies," Lopez
said.
When asked if he believes the GMA7-TV5 deal would constitute a monopoly,
Lopez said this would be an issue for the government to decide.
Lopez also emphasized that ABS-CBN is "not for sale," amid recent reports
that San Miguel Corp. President Ramon Ang is interested in investing in the
Philippine broadcasting industry.
Asked if anyone has approached the company, Lopez said: "I think my body
language is very clear on that. I don't think anyone is approaching us."
On track to meet 2012 target
Meanwhile, ABS-CBN expects its first-half profit growth to be flat, but is
still on track to meet its full-year net income target.
"It's close to flat. But we are sticking to our minimum target of P1.3
billion. We are on track for P1.3 billion," ABS-CBN chief financial officer
Ronaldo Valdueza said.
Lopez said the second half is going to be "significantly better" than the
first half, as the network continues to improve programming.
However, the increase in operating costs has put a drag on the company's
profits.
"There has been significant improvement (in profit), but because of the
competitive climate, operating costs has been going up. It's no secret we've had
to increase our talent fees, which has had a significant impact on our overall
profitability. The reality is if we did not have to increase our costs, we would
show a significant increase this year... We feel our trajectory is correct and
the second half would be significantly better," Lopez said.
ABS-CBN executives said the network continues to dominate the primetime slot
and its noontime show is making headway in the ratings game.
"We're very optimistic the ad community would see that if you combine the
ratings of both rural and urban, we have an inordinate increase over our
competitors, whether singly or combined, ABS-CBN is way ahead of them," Lopez
said.
Plans for soundstage, backlot
ABS-CBN President and chief operating officer Ma. Rosario "Charo"
Santos-Concio said the company is finalizing the business plan to build a
soundstage and several backlot facilities.
"We took the next steps in our vision to becoming the Filipino content
provider of choice. We are in the process of finalizing the business plan for
the building of a soundstage and backlot facilities for our future productions
and talents. These are facilities that would enable us to have better production
quality while saving on time and cost of location shootings," she said, during
the stockholders' meeting.
Valdueza said the company will build the soundstage and backlot in Bulacan.
"We have acquired a lot somewhere in Bulacan, it's about 15 hectares. We have
some consultants working with us. Hopefully, we will be able finalize the plans
soon. We are hopeful we can build at least one soundstage within the year,"
Valdueza said.
One soundstage is expected to cost between P150 million to P200 million.
ABS-CBN is planning to build at least 10 soundstages in the next 5 years.
"About 65-75% of all the shooting is location and with the soundstages,
babaligtarin namin yan. Maybe about 30% would be location (shooting) and most of
the shooting would be in soundstages," Lopez said.
Chief News Editor: Sol Jose Vanzi
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