Mr. President, most businesses are not like ABS-CBN

Published July 24, 2020, 11:15 PM

by Rj Nieto

THINKING PINOY

RJ Nieto

The House of Representatives had lots of reasons to reject ABS-CBN’s franchise application: foreign control, questionable acquisition of assets, labor violations, tax avoidance, and many more. I agree that many other media firms managed to get a new franchise despite committing one or more of the same violations.

However, I think there’s one specific thing that, in the best of my recollection, only ABS-CBN did. And that is the brazen defiance of its regulator, the National Telecommunications Commission, or NTC.

Despite receiving an order to refrain from monetizing the free-to-air digital frequency the government lent to it, ABS-CBN proceeded to sell pay-per-view subscriptions to the Pacquiao-Mayweather Fight. Asked why the media company defied NTC, the best excuse ABS-CBN CEO Carlo Katigbak can give was that they already sold the PPV subscriptions and so they had no other choice but to proceed.

I am a firm believer in second chances and I would’ve supported the idea of giving ABS-CBN a second chance if only to prevent the loss of thousands of jobs. I would’ve let that NTC issue slide if I were a congressman, but I can’t do that if ABS-CBN made defying NTC a habit, and that’s what ABS-CBN did.

In 2016, it offered PPV boxing for the Donaire v. Bedak, Philippines v. Mexico, and Magsayo v. Diaz. From 2017 onwards, ABS-CBN expanded its PPV TV offerings to include movies, concerts, and other events. Just earlier this year, it even sold PPV for Miss Universe Catriona Gray’s homecoming concert.

ABS-CBN made it a habit to ignore its lawful regulator, and that, I believe, is very difficult just to brush aside, and that’s why I understood why ABS-CBN didn’t get a franchise.

I understand that the denial of ABS-CBN’s franchise application will inevitably force ABS-CBN to scale down operations. Most of its revenues come from TV ads, and without a TV franchise, it’ll have to lay off workers to maintain profitability.

Tough decisions come with collateral damage. In the case of ABS-CBN’s franchise denial, it’s the retrenchment of thousands of employees, made worse COVID-19 -induced economic recession.

Yes, ABS-CBN may not deserve another chance, but I think may other erring Philippine businesses do, especially if they need some extra lenience just to weather the pandemic.

The Bureau of Internal Revenue, for example, should tolerate new small online businesses in the meantime, primarily since most of them were formed out of the desperation of Filipinos to make a living at a time when they cannot even leave their homes to work.

The same goes for barter trade. After months of little to no income, many Filipinos started to barter because they have no money to buy things with. Let’s not make their lives more complicated than it already is.

The Social Amelioration Program may have partially alleviated the problem. However, we all know that that the amount SAP provides barely meets the necessities of an average Filipino family, and SAP is intended only for the poorest, and not the middle class.

Unfortunately, after suffering the most prolonged lockdown on the planet, even the middle class is hurting now. If the government badly needs money, then it should start borrowing. We have a low debt-to-GDP ratio, and a stellar credit rating means little if we won’t actually borrow.

Aside from being more tolerant to small business, I hope the government doesn’t hurt its fiscal position by shuttering big taxpaying companies that may still be capable of reform. Because if the government attacks businesses at a whim, then it can say goodbye to its aim of providing “a more comfortable life for all.”

Take J&T Express, for example. The controversial logistics firm gained social media notoriety recently. Even I joked about the company several times on my social media page, like when I said I’ll start a fruit shake delivery service, where I’ll send ripe mangoes via J&T and their package handlers will handle all the work.

I like cracking jokes, so I watched the company closely for the past several weeks. Surprisingly, J&T seems to have started fixing its act after learning more than a few painful lessons. I’m not sure if it’s just for PR mileage, but I think the company deserves a second chance. J&T does not require the use of scarce state-owned assets like TV frequencies, and all the government needs to do is give it some time.

To cut a long story short, I believe the government should go after businesses that have definitively demonstrated a habit of breaking the law. However, it should be more understanding to those that have not.

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