Aborted deal between ABS-CBN, TV5: More than a business deal

WE CAN only speculate what could have been achieved by the planned investments agreement between ABS-CBN and TV5. When the venture was first announced in early August, Filipinos felt hopeful that something big in terms of news and entertainment programs could finally overwhelm the pressures of competition as well as government interference. 

On September 1, news broke that the two media companies had mutually agreed to drop their investment deal after some lawmakers and the National Telecommunications Commission (NTC) questioned the legality of the plan.

The legal question is rooted in the revocation of ABS-CBN’S franchise in July 2020 when the House Committee on Legislative Franchises had voted 70-11 against approval of ABS-CBN’s franchise renewal application. In effect, the network’s free TV and radio stations nationwide were banned from using their assigned broadcast frequencies.

ABS-CBN responded to the non-renewal by strengthening its franchise-free online platforms and partnering with various networks to show their programs, including its regular newscast. In 2020, ABS-CBN partnered with Zoe Broadcasting Network for the airing of ABS-CBN’s TV Patrol and entertainment programs on A2Z Channel 11. In 2021, TV5 aired four of ABS-CBN’s entertainment programs on primetime, while in April 2022, GMA also agreed to air movies produced by ABS-CBN’s Star Cinema. 

ABS-CBN and TV5 announced on August 10 a landmark agreement that would have gained for the former a sizable stake in the holdings of its former rival TV5. The shuttered broadcast giant was set to acquire shares representing 34.99 percent of TV5 stocks for PHP 2.16 billion. But in less than a month, the plan was aborted. 

Media did report on the initial pause and the eventual cancellation of the investment deal between ABS-CBN and TV5. News accounts in ANC, BusinessWorld, CNN Philippines, PhilStar.com, and News5 cited lawmakers, analysts and media practitioners who expressed their dismay about the news. 

CMFR noted the views of various sources who saw this development as more than just a business issue. News accounts tracked how the deal fused the interests of two media organizations; and also its sudden cancellation. Not surprisingly, the case has confirmed what other signals flagged: the Marcos administration is keeping close to the Duterte policy of dealing with a critical press and his low tolerance of press freedom. 

Timeline of events

The process did not take much time at all; as some actors took on the same roles in the political show that shut down ABS-CBN in 2021. These sounded as though they were reading from the same old script. 

Marcoleta, former House deputy speaker in the 18th Congress since 2019, was one of the strongest proponents of the non-renewal of the ABS-CBN franchise. He once again served as the ABS-CBN nemesis as well as TV5’s by sniffing around for a foreign owner of TV5 as his Committee had charged that ABS-CBN owner, Gaby Lopez, was not a Filipino, but an American citizen.

Marcoleta also singled out TV5 in his privilege speech on August 15, saying the network had breached the Constitution by having links to foreign owners. “MediaQuest, the parent company of TV5, is owned by PLDT Beneficial Trust Fund. And the grapevine is so loud that PLDT Beneficial Trust Fund is owned by an Indonesian national,” Marcoleta said. Sounding very much as he did in 2020. VERA Files fortunately fact checked Marcoleta’s claims on the said speech.

The NTC was also quick to question the deal, citing its memorandum dated June 23, 2022, prohibiting franchise holders to enter an agreement with companies with “outstanding issues with the government” – in this case, the non-renewal of ABS-CBN’s franchise.

This is not the first time, however, that the NTC has over-reached its authority by acting on media issues outside its purview. The NTC  was challenged by media and other lawyers when it ordered the blocking of access to two alternative media websites Pinoy Weekly and Bulatlat. CMFR also pointed out NTC’s failure to follow procedure when it assigned ABS-CBN’s former frequencies to Advanced Media Broadcasting System Inc. (AMBS) owned by business tycoon Manny Villar and Swara Sug Media Corporation (SSMC/SMNI) owned by Duterte ally and Pastor Apollo Quiboloy.

Division of the House 

This time, some voices in the House were heard to criticize the political interference designed to halt the deal worked out by ABS-CBN and TV5. 

Comments from different sectors

Fortunately, various sectors were quick to point out how politics has interfered with an issue of press freedom.

“Sayang”, “Too much politics”

For the business sector, it’s a “sayang” (wasted) deal. Further, Robin Garcia of Manila-based corporate advisory firm WR told Philstar.com that it was from an “implied campaign promise of policy continuity.” Garcia recalled how the Duterte administration along with several lawmakers shut down the media giant and left an estimated 11,000 media workers jobless; and President Marcos seems to continue that.

In the same article, Sam Ramos-Jones of Philippine Strategic Associates saw the deal’s end as “too much politics in business,” adding that political meddling went beyond proper regulation.

Terry Ridon, a public investment analyst, agreed in a BusinessWorld report, by saying that the dropping of the deal “has implications for both freedoms.” Ridon added that this creates a “chilling effect” on media and its owners, given that both networks are “respected” media giants.

In the same article, Michael Henry Yusingco, a lawyer and political analyst, said that the deal’s termination is a “casualty of power politics,” especially since debtors and creditors of the two parties did not raise any concerns. Maria Ela L. Atienza, professor of political science at the University of the Philippines, found it “troubling” that businesses can no longer be relied on to “honor or to commit to partnerships and agreements.”

Media community reacts 

Media practitioners and professors also hit the political pressure on the ABS-CBN and TV5 partnership deal termination, calling it an attempt to control media practice. 

Danilo Arao, University of the Philippines journalism professor, told BusinessWorld that the termination of the deal “perpetuates the existing monopoly of Philippine media.” In the same article, Luis V. Teodoro, former dean of the UP College of Mass Communication and CMFR trustee, said the deal could have made more information available to Filipinos. This makes the citizens and their right to know the real losers in the trashing of the agreement. 

Herman Basbaño of Kapisanan ng mga Brodkaster ng Pilipinas told Philstar.com that the partnership would have been an “antidote” to monopoly and promote healthier competition.

Veteran journalist Christian Esguerra in a commentary on VERA Files called some lawmakers “party-poopers,” particularly the same ones who took part in ABS-CBN’s shutdown during Duterte’s presidency. He also said that the issue should serve as a lesson to other media owners: “Wag po sanang duwag or naive ang ilang media owners sa first instance pa lang ng panggigipit.” (Hopefully, media owners will not be cowards or be naive at just the first instance of repression.)

Meanwhile, lawmakers from the Makabayan bloc, as well as Surigao Del Sur Rep. Johnny T. Pimentel and Cagayan De Oro Rep. Rufus B. Rodriguez filed bills seeking to renew ABS-CBN’s franchise in the current 19th Congress. France Castro, ACT Teachers Party-list Representative, told CNN Philippines that “their (ABS-CBN’s) only fault, as the Duterte administration and its minions see it, is that they continued to report and broadcast the abuses, blunders, and inefficiencies of the past administration. Now these minions are continuing this media harassment even with the deal with TV5.” 

ABS-CBN’s shutdown proved Duterte’s intent on muzzling the critical press or presumably anyone who dares to question those in power and expose wrongdoing in high places. 

The actions of Marcoleta and his minions in the NTC, as well as those in the HoR chorus should provoke greater solidarity in the media community. More journalists should ask: What does this say about the freedom and autonomy of the press in the second Marcos administration?