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By Darwin G. Amojelar, Reporter
AMID shrinking corporate ad spending and the
dominance of two TV networks, a small player aims to shake up the
industry by tapping the mass youth market through innovative
programming.
Associated Broadcasting Co. (ABC)
Channel 5, owned by Antonio Cojuangco, will do it through the help
of Media Prima Berhad, a Malaysian company.
The Malaysian firm created a
local unit, MPB Prime Media Inc., which entered into a long-term
block airtime agreement with ABC5.
Under the agreement, Prime Media
will provide content and manage the sale of ABC5 airtime. In turn,
ABC5 will undertake a repositioning and launch exercise as well as
transmission quality upgrade with the help of the Malaysian firm on
a consultancy basis.
Early last month, the joint
venture gave birth to TV5.
The partnership with ABC5 is the
first Philippine investment of the Malaysian company.
The unit of Media Prima's MPB
Strategic Media Fund Limited Partnership plans to invest between
$100 million and $150 million over five to seven years across South
East Asia and in other Asian emerging markets.
The Media Fund will be MPB's
vehicle for its regional expansion in line with its strategy to grow
and diversify the group's earnings and enhance shareholder
value.
“We are excited about the
growth opportunities in ABC5 and [the] Philippines and intend to
adopt similar strategies that led to the turnaround success of all
our television networks in Malaysia," Abdul Rahman Ahmad, group
managing director and chief executive of MPB said.
Media Prima is the largest
integrated media investment group in Malaysia with a diversified
interest in both the electronic (TV and radio) and print media
besides content development, event management, and outdoor
advertising.
Media Prima owns four free-to-air
TV networks in Malaysia, namely 8TV, ntv7, TV9 and TV3. It also owns
two radio networks, Fly FM and Hot FM.
MPB also has interests outside
Malaysia, including a venture in TV3 Ghana, which emerged as that
country's preferred free-to-air TV network.
MPB's media assets reach close to
22 million Malaysians daily, including 11.2 million TV viewers, 6.8
million newspaper readers, and 3.5 million radio listeners.
“With TV penetration in
the Philippines currently at 72.7 percent and total advertising
expenditure reported at $2.8 billion in 2006 [and] television having
more than 75 percent of that, ABC5 represents a high-growth
potential,” MPB said in a recent statement.
Christopher Sy, MPB Prime Media
chief executive told The Manila Times that ABC5 is a good place to
invest, adding that the two companies are interested in creating a
third station.
"I think we're pretty well
funded. TV is a long term investment and we're confident that we
will able to keep up the pace," Sy said.
Without providing figures, Sy
said Prime Media has invested a significant amount of money to
re-brand the network from ABC5 to TV5.
Sy said the block time agreement
with ABC5 would last more than five years. “Prime Media is a block
timer. We're sourcing a lot of programs, we control a lot of
time,” he added.
The executive however refused to
disclose the revenue sharing agreement between the two companies.
He explained that the re-branding
is meant to address ABC5's difficulty in providing focus.
"Mr. Cojuangco wants
to start again and then partnered with Prime Media to develop a
third station," Sy said.
The former executive of EMI Music
Philippines said Prime Media is optimistic about the prospects of
TV5 and its chances of turning a profit.
"We are confident. If you
get the programming right, we will succeed. There's nothing wrong
with the business model. It's all about coming up [with] a relevant
content," Sy said.
Market focus
TV5 targets the progressive
Filipino young audience who is open to changes and willing to try
new experiences, events and discoveries.
"Our focus now is the broad
mass youth market that was being underserved by the two biggest
networks in the country," Sy said.
“I guess you could call it a
broad niche market,” he added.
Sy said ABS-CBN and GMA 7 are
serving the mass market, with a focus on the family audience.
"Their target market is very broad,” he said.
Under the partnership agreement,
TV5 would target viewers below the age of 30, which make up 60
percent of the population.
In terms of socioeconomic class,
it will focus on the C and D viewers, which consist about 70 percent
of the population.
The executive said these are
people who are open to new things.
"It's really a big portion
of the market. They are a little bit tougher to get to but
definitely, in terms of advertisers they are [a] very valuable
market. It's enough to be viable," he said.
"All advertisers want to
reach the youth. Their total spending power is big and we want to
serve that market," he added.
In a recent study, Nielsen Media
Research said more than 76 percent of teens spend the day watching
TV during weekdays and 66 percent during weekends.
In terms of viewing time, teens
watch TV between 12 noon and 3 p.m and between 8 p.m and 10 p.m.
The Nielsen study said teens
usually watch drama, 47 percent; animation/cartoons, 40 percent;
comedy, 39 percent; and game shows, 28 percent.
Shake the viewing habit
TV5 aims to shake the audience's
regular viewing habit by providing innovative programs, which
include reality, drama, variety, teens and toons and movies.
"What we really want to say
to people is to shake your TV and try something new. A lot of people
are Kapamilya and Kapuso," Sy said, adding that it is a good
time for the company to re-brand because people are looking for an
alternative.
"Channels 2 and 7 have been
there for a while, but there's a clamor for an alternative show.
Young people want a change,” Sy said.
He said TV5 aims to become a
solid number three in the industry.
"Eventually, we want to see
our market share at [the] high single-digit to low-double digit.
Maybe 10 percent in three years," he said.
Prior to the re-branding, Sy said
ABC5 had a market share of about 1 percent, ranking it number five.
With the re-branding, Sy said TV5
is now very close to QTV, which ranks third.
He said that TV5 will challenge
the industry norm by presenting a different program every night,
promising a lineup of new shows of diverse genres.
"We wanted to give people an
alternative and make our shows more exciting," Sy said, adding
that the network will strengthen its prime time block from 5 p.m. to
10 p.m.
TV5's new shows include Midnight
DJ, Love Books, Golden Bride (a Korean movie), Rebelde, Untamed
Beauties, Lipgloss, Hush Hush, Rakista, Shall We Dance, Philippines'
Scariest Challenge, My Most Valuable Pinoy, Mysmatch, among others.
Sy said its current programming
mix is 40-percent local and 60-percent canned.
"Hopefully, soon we want to
have 60-percent local and 40-percent canned. To be heavy in local is
more expensive, [but] I think that's an investment [that] needs to
be made, if you want to be relevant [to] the target market. We just
[have] to be mindful of the investment that we are making," he
said.
Big networks unfazed
Despite the high-profile
re-branding of the small player, ABS-CBN and GMA Network are
unfazed.
Jimmy Duavit, GMA executive vice
president and chief operating officer, said that his network is
monitoring the scene.
"Right now, there's [has]
been [no] effect on our market share," Duavit said in a recent
press briefing.
Vivian Tin, ABS-CBN vice
president for research and business development also said TV5's
re-launch has had no impact on the Lopez-owned company.
"We're looking at it. Based
on the experience of Studio 23 doing local production in a small
channel drains cash," she said.
ABS-CBN and GMA Network
collectively control 80 percent of the market.
Challenges
Sy said getting into the ratings
game remains a challenge for the network.
He, however, said that TV5 is
very serious about getting some ratings to attract more advertisers.
"There's a lot of interest.
They [advertiser] are very optimistic and very supportive. Even the
advertisers want [something] new. They are coming in to support
us," he said.
Despite the weak domestic economy
and higher inflation, Sy said the re-launch of TV5 comes at a right
time as people are looking for an alternative.
"I think the economy does
not stay bad forever. It's a cycle. We're still optimistic on the
industry," the executive said.
Jay Bautista, Nielsen executive
director, earlier said corporate ad spending would slow down this
year and next as advertisers defer their media spending owing to
soaring inflation and a weak domestic economy.
In the first half this year,
media ad spend, however, grew 15 percent to P79.76 billion from
P69.32 billion in the same period last year.
“The double digit growth is
mainly driven by radio. Ad spend in TV is actually almost flat
because if you look at the advertising slot it is saturated
particularly in primetime,” Bautista said.
The share of media spend was
higher in TV at 76 percent followed by radio, 17 percent and print,
7 percent.
With the convergence of
technology, Sy said TV5 is also looking at distribution methods like
mobile TV and Internet TV.
"This is something we would
like also to explore, but what's important right now is to build our
brand. So that TV5 becomes a brand that everybody recognizes,"
Sy said.
Besides investing in programming
and content, TV5 has also undertaken a transmission quality upgrade
that will enable it to broadcast with the strength of a 120-kilowatt
transmitter, which is stronger than that of the country's major
networks.
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