PCC study: Free TV competition suffered severe blow after ABS-CBN shutdown


The competition in the country’s free television industry has severely weakened since the non-renewal of ABS-CBN Corp.'s franchise in 2020, according to a new study by the Philippine Competition Commission (PCC).

The study titled “Blocktiming Practices in the Philippine Free TV Industry.” authored by Shereena Salas and Gwyneth Ramos, noted that ABS-CBN’s exit resulted in increased market concentration.

According to the study, GMA Network now commands roughly 93 percent of the free TV market.

When ABS-CBN’s TV network was still standing in early 2020, the station had 51 percent of the market, while GMA had 45.5 percent.

The PCC said having one company essentially monopolize the industry raises serious concerns about fair competition, access to broadcasting frequencies, and content diversity.

“The exercise of market power may harm competition by curbing viewer choices and restricting the entry of content producers,” the study read.

The agency, however, pointed out that the rise in over-the-top (OTT) platforms like Netflix and YouTube are helping reshape the competition.

It explained that these alternative modes of distribution allow viewers to access a variety of program selections, while giving content producers diverse value propositions.

“Ultimately, the success of free TV as a content distribution medium relies on robust competition and a supportive regulatory framework,” it added.

Hitting pause on blocktime

The PCC also flagged the increased regulatory scrutiny by the National Telecommunications Commission (NTC) as a hurdle in the free TV industry.

It noted how the NTC, the country’s telecommunications regulator, created a huge problem for the market when it started requiring prior approval for blocktime agreements, including capping of programming at 50 percent of the TV network’s airtime.

Blocktime agreements are contracts where content producers pay broadcasters for a specific amount of airtime to air their own programs.

The PCC said these regulations could make it more challenging for new companies to enter the market raise prices, create regulatory uncertainty, and distort competition.

It argued that this could even be used by the networks themselves to discriminate against certain firms or to favor certain types of content.

“Conceptually, given smaller TV networks’ limitations to produce most of their content in-house, the 50% limitation on airtime allocation could prevent them from gaining a foothold in the free TV market,” the agency added.

The PCC explained that even before the 50 percent limit, most networks prioritize their own content over blocktime content.

However, since the NTC ordered these restrictions in 2022, no applications have been submitted regarding blocktime agreements, which suggests that new deals were discouraged.

“Enforcing regulations that foster fair access to airtime, prevent discrimination, and encourage diversity and innovation can address these competition concerns and protect consumer interests,” the study read.

Rebooting competition

To foster a competitive free TV industry, the PCC is urging the government to award licenses to new stations and ease the process for networks to enter the market.

It may also consider the renewal of ABS-CBN’s franchise upon satisfying its regulatory requirements.

Recently, several bills have been filed in the House of Representatives seeking a new 25-year franchise for the company.

Meanwhile, the PCC said the jurisdiction of the NTC on blocktime agreements must first be confirmed to ensure effective oversight. 

According to the study, clear rules and guidelines should be established to simplify compliance for blocktimers seeking access to broadcasting frequencies

Additionally, the agency explained that consumer choice among TV networks and alternative platforms could be further improved by investing in infrastructure that breeds growth.

This could include upgrading broadband networks and expanding access to high-speed internet, it said.