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MEDIATIMES 2013_Media Mogulry Redux

MEDIATIMES 2013_Media Mogulry Redux

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MANUEL V. PANGILINAN (MVP) has brought his huge financial resources to bear on telecommunications, power generation and distribution, mining, infrastructure and high-end health care services. He is arguably the most powerful force in Philippine business today.

But in the world of powerful media, Pangilinan’s name may not be as big as those of his precursors in the first years of the post-Marcos era.
MANUEL V. PANGILINAN (MVP) has brought his huge financial resources to bear on telecommunications, power generation and distribution, mining, infrastructure and high-end health care services. He is arguably the most powerful force in Philippine business today.

But in the world of powerful media, Pangilinan’s name may not be as big as those of his precursors in the first years of the post-Marcos era.

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Published by: Center for Media Freedom & Responsibility on Apr 11, 2014
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48
 |
MEDIA TIMES
2013 • Center for Media Freedom & Responsibility
‘MEDIA MOG
BY JOHN REINER M. ANTIQUERRA
M
ANUEL V. PANGILINAN (MVP) has brought his huge inancial resources to bear on telecommunications, power generation and distribution, mining, infrastructure and high-end health care services. He is arguably the most powerful force in Philippine business today.But in the world of powerful media, Pangilinan’s name may not be as big as those of his precursors in the irst years of the post-Marcos era. The Lopez family recovered its lagship media enterprise, ABS-CBN, almost immediately after the fall of the dictatorship. Others in the same league are Emilio Yap, who gained control of the
Manila Bulletin
; the Prieto family, which bought the
Philippine Daily Inquirer 
 from founder journalist Eugenia Apostol in 1994; the Belmontes who held the majority stocks of
The Philippine Star 
; or Felipe Gozon, Joel Marcelo Jimenez, and Gilberto Duavit Jr. who bought GMA-7 in 1975 from Robert La Rue Stewart. In a class by himself was the late Raul Locsin, a journalist whose
BusinessWorld 
 held a special niche as the leading business paper in the country. Pangilinan’s holdings in media companies have nevertheless gained him an impressive edge. The control he exerts over the range of corporate interests has also stirred the curiosity of political observers who wonder about the purpose of this media focus. Like Pangilinan, other media owners have interests in other enterprises. The Lopezes have retained holdings in telecommunications, power generation and distribution, and real estate. The Gozons are also in banking and real estate. The Prietos are in real estate, services and publishing. Yap has business holdings in shipping, banking, services and education. The Manila Electric Company (Meralco) was impressive enough to draw Pangilinan’s roving interest. Pangilinan bought Meralco from the Lopezes in 2009. The picture today is not far removed from the media landscape before Marcos shut down the free press in the country in 1972. It is “media mogulry” redux, except that this time the competition is greater and the stakes higher, with media providing the double edged blade of economic and political clout.
MVP’S MEDIA GROUP
MediaQuest Holdings is incorporated under the retirement fund of the Philippine Long Distance Telephone Co. (PLDT) handling the media accounts of the Pangilinan-group. Its subsidiaries Satventures Inc. and Hastings Holdings, Inc. deal with broadcast and print assets respectively. It has holdings in TV5, and in the newspapers
BusinessWorld,
the
Star
and the
Inquirer 
.
 
Center for Media Freedom & Responsibility • 2013
MEDIA TIMES
 |
49
 
ULRY’ REDUX
The PLDT said in its annual report for 2012 with the Securities and Exchange Commission that “on March 14, 2013, ePLDT made a deposit of Php750 million for its investment in Satventures and Hastings PDRs (Philippine Depository Receipts) of MediaQuest.“The PLDT Group’s inancial investment in PDRs of MediaQuest is part of the PLDT Group’s overall strategy of broadening its distribution platforms and increasing the Group’s ability to deliver multi-media content to its customers across the Group’s broadband and mobile networks.”Pangilinan’s entry into the Philippine business sector was through the investment of Hong Kong-based First Pacific Company Ltd. in PLDT in 1998. In late 2009, MediaQuest acquired the third largest private broadcast media player ABC-5 from Antonio “Tonyboy” Cojuangco. It rebranded ABC-5 into TV5 with an aggressive positioning that projected it as a competitive force against top television networks ABS-CBN 2 and GMA-7.MediaQuest had been in the cable TV business prior to Pangilinan’s entry into PLDT and has gained entry into other media entities like BusinessWorld and the National Broadcasting Corporation which operates several radio stations in the country. But Pangilinan’s acquisition of ABC-5 marked his entry as a competitor in the media business.The company redeveloped programming, aggressively hiring from the ABS-CBN 2 and GMA-7 stables of broadcast journalists, celebrities and executives. But the not-so-new kid on the block had little to offer that was really new or fresh enough to steal the lead from either ABS-CBN 2 or GMA-7. Audience loyalty is pretty much cast in habit and TV5 has had to struggle to keep even its third place ranking. As the excitement and buzz over TV5 leveled off, Pangilinan moved to acquire GMA-7 in 2012. But negotiations have hit a dead end. Meanwhile, the ownership composition of PLDT is being questioned anew with lawyer Jose Roy III, former dean of the Pamantasan ng Lungsod ng Maynila College of Law, asking the Supreme Court to reinvestigate PLDT for its alleged violation of the constitutional limit on foreign ownership of public utilities.The
abs-cbnNEWS.com
 reported that Roy also asked the Supreme Court to “order the SEC to investigate all corporations in which the PLDT Beneicial Trust Fund has made investments in and to determine whether these corporations and their subsidiaries also violated the foreign ownership cap.” (“SC urged to order new probe into PLDT’s foreign ownership,” June 11, 2013, http://www.abs-cbnnews.com/nation/06/10/13/sc-urged-order-new-probe-pldts-foreign-ownership)The 1987 Philippine Constitution reserves at least 60 percent of ownership and management of public utilities for Filipinos. It also limits ownership and management of mass media only to Filipino citizens.
TAKING OVER BUSINESSWORLD
This year, the Pangilinan group moved to take control of two dailies, with MediaQuest acquiring majority stocks in
BusinessWorld 
 and the
Star 
.
BusinessWorld 
’s employees owned about 70 percent of the company’s stocks. The founder of the paper, Raul Locsin, had made sure of it to assure the editorial independence of the paper.On September 17,
BusinessWorld 
 reported that MediaQuest through Hastings would be owning 76.67 percent of the stocks of BusinessWorld Publishing Corp. (BWPC) and infusing PHP100 million into its operations in the next 12 months. (“MediaQuest assumes control of BusinessWorld,” http://www.bworldonline.com/content.php?section=TopStory&title=Mediaquest-assumes-control-of-BusinessWorld&id=76584)
I   O  O CM O
 
50
 |
MEDIA TIMES
2013 • Center for Media Freedom & Responsibility
On May 28, ABS-CBN Convergence, Inc., a subsidiary of ABS-CBN Corp., told the Philippine Securities and Exchange Commission that it had signed a network sharing agreement with Globe Telecoms which they said would enable ABS-CBN to deliver “content and offer traditional telecoms services on mobile devices.In a press release, ABS-CBN said that “through the network-sharing agreement, Globe will provide capacity and coverage on its existing cellular mobile telephony network to ABS-CBN Convergence on a nationwide basis. The parties may also share assets such as servers, towers, and switches.”The Lopez-owned telco Bayan Telecommunications, Inc. is under a debt restructuring plan with Globe. Globe said that the Pasig City Regional Trial Court Branch 158 had allowed the amendment of the plan converting 69 percent of Bayan’s debt to 56.6 percent of Bayan’s capital stock for Globe.
 ANC-YAHOO CONTENT PARTNERSHIP
Meanwhile, cable channel ABC-CBN News Channel (ANC) and online search engine and web service group Yahoo! Philippines announced on July 18 a content partnership.The partnership allows ANC to push its content online through a dedicated microsite (http://anc.yahoo.com) in the Yahoo! platform. The page went live on July 22 for the coverage of the fourth State of the Nation Address of President Benigno S. Aquino III.Yahoo! Philippines country manager and editor Kate Delos Reyes said in an
 InterAksyon
 report that “This partnership is a true online and on-air collaboration that aims to reinvent how consumers access news across screens.” (“ANC, Yahoo! Phils forge content partnership, July 18, 2013”, http://www.interaksyon.com/business/66682/anc-yahoo-phils-forge-content-partnership)Yahoo! has a separate news service in the Philippines which also carries content from other local news organizations. The content partnership with ANC is the irst outside the US, said Yahoo! Philippines.
OTHER SOURCES:
Timeline: PLDT acquisition talks with GMA7. Oct. 4, 2012. Retrieved from http://www.interaksyon.com/business/44729/timeline-pldt-acquisition-talks-with-gma7Pangilinan, M. (April 9, 2006). My journey. Retrieved from http://philstar.com/sunday-life/330648/my-journeyGMA Network, Inc. Corporate Profile. Retrieved from http://www.gmanetwork.com/corporate/about/overviewPhilippine Daily Inquirer History. Retrieved from http://inquirer.dqs.com.ph/index.php/about-us/historyMetro Pacific Investments Corp. website. Retrieved from http://www.mpic.com.ph/site/First Pacific Company Ltd. Website. Retrieved from http://www.firstpacific.com/Lopez Holdings Corp. website. Retrieved from http://lopez-holdings.ph/SEC reports and PSE disclosures of one or more of the following: GMA Network, Inc., MediaQuest Holdings Inc., ABS-CBN Corp., PLDT, BusinessWorld Publishing Corp., Inquirer Publications Inc., Inquirer Holdings Inc., Phil Star Daily Corp., Manila Bulletin Publishing Corp.
BusinessWorld 
’s shareholders had earlier approved an increase in capital, Pangilinan was quoted as saying in a June 14 report on
InterAksyon
. (“PLDT Group seals takeover of BusinessWorld,” June 14, 2013, http://www.interaksyon.com/business/64096/pldt-group-seals-takeover-of-businessworld) This was further conirmed in an August 7
Star 
 report, which said the MVP group had formalized the acquisition of the majority stake in
BusinessWorld 
 with the infusion of fresh capital. (“MediaQuest gains control of BusinessWorld,” http://www.philstar.com/business/2013/08/17/1098901/mediaquest-gains-control-businessworld)Ray Espinosa, former president of TV5, told the
Star 
 that “MediaQuest has exercised its pre-emptive right to subscribe to 30 million new shares of BusinessWorld. MediaQuest has also agreed to subscribe to 70 million new shares of BusinessWorld, which were not taken up by other shareholders.” (“MediaQuest gainst control of BusinessWorld,” August 17, http://www.philstar.com/business/2013/08/17/1098901/mediaquest-gains-control-businessworld)The MVP group had acquired a minority stake in
BusinessWorld
in 2004. Prior to the acquisition, MediaQuest held only a 30 percent share in
BusinessWorld 
. (Business and beyond, July 5, 2013, http://www.bworldonline.com/content.php?section=SpecialFeature&title=Business-and-beyond&id=72929)The BWPC board also approved the appointment of Ray C. Espinosa, the former president of TV5, as chairman, while Barbara Locsin and Arnold Belleza were replaced as directors. Belleza will remain as executive editor, while Locsin will join the board of advisers. Publisher and chairman of the editorial board Vergel O. Santos was earlier retained. But Santos iled his resignation. (See sidebar “BusinessWorld Changes Hands: The End of an Era.”)
THE PHILIPPINE STAR
In late 2012, Pangilinan announced his revived interest to increase his stake in the
Star 
, conirming to members of the press that his group was engaged in talks with the Belmonte family, the majority stock holders of the news daily. (“PLDT pushes plan to raise stake in ‘Star’,” Dec. 19, 2012, http://www.businessmirror.com.ph/index.php/en/news/top-news/6086-pldt-pushes-plan-to-raise-stake-in-star)The MVP group was looking to acquire 80 percent of the
Star 
, said Mike Toledo, head of the Pangilinan group media bureau. He told the
Inquirer 
 that “the group will also control afiliates of the Star. This is part of the MVP group’s convergence strategy and evolution into a multimedia service company.” (“Pangilinan group to acquire Philippine Star,” July 20, 2013, http://business.inquirer.net/133497/pangilinan-group-to-acquire-philippine-star)The MVP group already owned 20 percent of The Star Group of Companies which publishes the news dailies the
Star 
 and
Pilipino Star Ngayon
 as well as the lifestyle magazine
People Asia
. It also publishes the Cebu-based newspapers
The Freeman
 and
Banat News
.MVP’s efforts to acquire the
Star 
 irst made headlines in January 2009.
 ABS-CBN-GLOBE NETWORK SHARING DEAL
Meanwhile, corporate mergers continued in other areas of the news media, as ABS-CBN clinches partnerships with a telecommunications and an online service company.
MEDIA MOGULRY REDUX

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