Indicators of Risks to Media Pluralism

Media Audience Concentration

This indicator assesses the concentration of audience and readership across media platforms based on audience share. Concentration is measured by using the Top 4 owners in the market. 

Result: With a highly concentrated TV and Radio market, a low concentration in the print market, media audience concentration puts a HIGH RISK on media pluralism in the Philippines.

Why?

The TV market is highly concentrated, as the major four owners ABS-CBN Corporation, GMA Network Incorporated, TV5 Network Incorporated and Nine Media Corporation represent an audience share of 88.77 percent. The result is even more striking as even the two biggest companies – ABS-CBN Corporation and GMA Network Incorporated form a duopoly, firmly grasping an audience share of 80.72 percent. In relation, the fourth biggest player is a midget (Nine Media Corporation), reaching only 0.45 percent of the audience. ABS-CBN belongs to one of richest and longest-established clans - the Lopez Family. GMA Network is held by the triumvirate of influential businessmen Gilberto Duavit Sr. and family, Menardo Jimenez and family, and Felipe Gozon and family. Nine Media Corporation is run by Antonio Cabangon-Chua. TV5 Network Incorporated belongs to MediaQuest Holdings Incorporated which is the holding company of PLDT Beneficial Trust Fund’s mass media conglomerate. It is owned by businessman Manuel V. Pangilinan (who also heads various other businesses in the Philippines) but can ultimately be traced back to Indonesian Anthoni Salim’s First Pacific group of companies. 

AM stations are where you go for news. FM stations on the other hand mostly play music. Listeners that turn toward AM stations are those who seek news on-air and shape their opinion supposedly accordingly. For Top 4 radio media companies that run popular AM stations and thus are active on the radio market, ABS-CBN Corporation (DZMM 630, 24.9 percent) and GMA Network Incorporated (DZBB 594, 22.3 percent) stand out as the top players. Interestingly, the Philippine Broadcasting Service-Bureau of Broadcast Services (PBS-BBS), run by the Presidential Communications Operations Office (PCOO), reaches 22.3 percent of the audience through DZRB 738. Together with the fourth biggest company, Manila Broadcasting Company, they reach 84.3 percent of the audience – which equals a high concentration in the news radio market. Besides the government, the Lopezes (ABS-CBN Corporation), the Duavit/Jimenez/Gozon connection (GMA Network Incorporated), and the Elizalde Family (Manila Broadcasting Company) have a stand in the radio market.

Note: Out of all of the time (100 percent) that radio is listened to, it is FM radio 89 percent of the time, and only 12 percent to AM stations. This illustrates that Filipinos turn on the radio rather for music than for news.

The TOP 4 print companies all play in the same league, between 13 and 20 percent audience share each. Those ratings could not be added up*, as it included duplications. Media concentration appears low as the ownership is distributed among several players that all have the same market position. Press turns out to be a popular family business: the Macasaet Family holds Monica Publishing Corporation, the Yap Family owns Manila Bulletin Publishing Corporation, Inquirer Holdings belongs to the Rufino-Prieto Family. The Sison Family, who owns Sison's Publishing Corporation that releases the most read tabloid Bulgar, remains mysterious -  little information could be found on them. 

*Note: This is only a proxy. Nielsen provided shares on “incidents of readership”, projecting a universe of roughly 40.6 million Filipinos possibly reading newspapers and magazines in the National Urban Philippines. Those shares were put in relation with the number of people that actually read newspapers at least once a week, a total of 27.8 percent (FLEMMS Report 2013) – which was set as 100 percent audience share. Those ‘incidents of readership’ are not additive numbers - can't be added up - , as they can include duplications.

For the online news market, data was only available in unique visitors but not as audience share. This inhibited to compute an audience concentration for the online news market. The most popular websites, however, all belong to companies that also publish other media outlets, which strengthen their cross-media presence. The Internet Service Provider (ISP) market as the backbone of the online infrastructure, however, is highly concentrated with more or less two major players - PLDT/Smart and Globe Telecom - setting the conditions and prices. 

LOW (1)MEDIUM (2)HIGH (3)
Audience concentration in television (horizontal) 
Percentage: 88.77% (based on Nielsen’s TV Audience Measurement, January-August 2016).
  • ABS-CBN Corporation: 40.99% (ABS-CBN2: 37.58%, ABS-CBN Sports and Action: 3.41%)
  • GMA Network: 39.73% (GMA7: 35.95% , GNTV: 3.78%)
  • TV5 Network: 7.6% (TV5)
  • Nine Media Corporation: CNN Philippines (0.45%)   
If within one country the major 4 owners (Top4) have an audience share below 25%.  If within one country the major 4 owners (Top4) have an audience share between 25% and 49%.  If within one country the major 4 owners (Top4) have an audience share above 50%. 
Audience concentration in Radio (horizontal) 
Percentage: 84.3% (Nielsen’s Radio Audience Measurement, RAM, Jan-Aug 2016)
  • ABS-CBN Corporation: 24.9% (DZMM 630)
  • GMA Network: 22.3% (DZBB 594)
  • Philippine Broadcasting Service-Bureau of Broadcast Services (PBS-BBS): 22.3% (DZRB 738)
  • Manila Broadcasting Company: 15% (DZRH 666)  
 
If within one country the major 4 owners (Top4) have an audience share below 25%.  If within one country the major 4 owners (Top4) have an audience share between 25% and 49%.  If within one country the major 4 owners (Top4) have an audience share above 50%. 
Readership concentration in newspapers (horizontal) 
Percentage: incidents of readership (Nielsen’s “Consumer and Media View” , Jan-Aug 2016) were not added up, as they include duplications. shares were set in relation with population exposed to newspapers = 27.8% (PSA)
  • Sison's Publishing Corporation: 6.9% (Nielsen: 1.92 = Bulgar, 1.92)
  • Monica Publishing Corporation: 5.2%  (Nielsen: 1.44 = Abante, 1.17; Abante Tonite, 0.27)
  • Inquirer: 4.8% (Nielsen: 1.34 = Philippine Daily Inquirer, 0.65; Bandera, 0.55; Sunday Inquirer Magazine, 0.14)
  • Manila Bulletin Publishing Corporation: 4.6 (Nielsen 1.28 = Manila Bulletin, 0.80; Balita, 0.38;Tempo 0.1)
If within one country the major 4 Owners have a readership share below 25%. If within one country the major 4 owners (Top4) have a readership share between 25% and 49%.  If within one country the major 4 owners (Top4) have a readership share above 50%. 
Audience concentration in Internet (horizontal) 
Percentage: audience share not available, only unique visitors.
If within one country the major 4 owners (Top4) have an audience share below 25%.  If within one country the major 4 owners (Top4) have an audience share between 25% and 49%.  If within one country the major 4 owners (Top4) have an audience share above 50%. 

Media Ownership Concentration

This indicator aims to assess the horizontal ownership concentration based on market share which illustrates the economic power of companies/ groups. Concentration is measured for each media sector by adding the market shares of the major owners in the sector.

Result

The media ownership concentration based on market shares could not be computed. While the Securities and Exchange Commission provided access to the financial data (revenue, advertising etc.) of each company as a whole - more or less updated – the data was not available as a) market share and b) per media sector. The concentration for all media-sectors together is evaluated as cross-media-concentration.

Score:

LOW (1)MEDIUM (2)HIGH (3)
Ownership concentration in television (horizontal): This indicator aims to assess the concentration of ownership within the TV media sector. 
Percentage: not assessed    
If within one country the major 4 owners (Top4) have a market share below 25%.  If within one country the major 4 owners (Top4) have a market share between 25% and 49%.  If within one country the major 4 owners (Top4) have a market share above 50%. 
Ownership concentration in radio (horizontal) : This indicator aims to assess the concentration of ownership within the Radio media sector.    
Percentage: not assessed    
If within one country the major 4 owners (Top4) have an audience share below 25%.  If within one country the major 4 owners (Top4) have an audience share between 25% and 49%.  If within one country the major 4 owners (Top4) have an audience share above 50%. 
Ownership concentration in newspapers (horizontal) : This indicator aims to assess the concentration of ownership within the print  sector.
Percentage: not assessed    
If within one country the major 4 owners (Top4) have a market share below 25%.  If within one country the major 4 owners (Top4) have a market share between 25% and 49%.  If within one country the major 4 owners (Top4) have a market share above 50%. 
Ownership concentration in Internet Content Providers 
Percentage: not assessed    
If within one country the major 4 owners (Top4) have a market share below 25%.  If within one country the major 4 owners (Top4) have a market share between 25% and 49%.  If within one country the major 4 owners (Top4) have a market share above 50%.  

Regulatory Safeguards: Media Ownership Concentration

This indicator assesses the existence and effective implementation of regulatory safeguards (sector-specific and/or competition law) against a high horizontal concentration ownership and/or control in the different media.

Result:

Regulatory safeguards to prevent media ownership concentration are limited.  A new anti-trust body has been established by the Fair Competition Act (2014) - the Philippine Competition Commission (PCC) - which could serve to monitor, prevent or otherwise breakup media monopolies. It is responsible to prevent market distortions in all business sectors. There are only few media-specific regulations (e.g. licensing in audio-visual sector). That is why a MEDIUM RISK was diagnosed.

Why?

  • Licensing in the audio-visual sector depends on the available frequencies. It is done in a relatively transparent twin-franchising procedure in which the Securities and Exchange Commission (SEC), the Congress as well as the National Telecommunication Commission (NTC) are involved à link to “How to get a license?" The decision about whether issuing a license or not, is not based on arguments that involve the applicant’s prior engagement in the media sector. There are no media-specific objective thresholds (e.g. number of licenses, audience share, turnover/ revenue) that would give SEC, NTC, Congress a reason not to decide in favor of granting a franchise.
  • The NTC turns out to be powerless when it comes to revoking licenses – as they are based on a congressional decision and thus can only be revoked by the Congress. Also, a reason for a franchise revocation or penalty would not be due to concentration but e.g. if technical supervision would be lacking.
  • For print and online, only a registration at SEC is necessary but no media-specific authorization. That is why there was seen no need for establishing a regulatory authority for print or online media companies.
  • Media-specific regulations for blocking a merger or acquisition don’t exist. However, the Philippine Competition Commission as a general anti-trust body that can prevent or otherwise breakup media monopolies. As the PCC is a relatively new institution, its assertive powers can’t be assessed yet. But it fletches it teeth’s and holds up high hopes in the Smart/Globe case.

Regulatory Safeguard Score:

8 out of 15 – Medium Risk (53.3%).

1 = media-specific regulation/ authority

0.5= competition-related regulation/ authority

Table summarizes TV/Radio - Max. score: 4 per sector.    DescriptionYesNoNAMD
Does the media legislation contain specific thresholds or limits, based on objective criteria (e.g. number of licenses, audience share, circulation, distribution of share capital or voting rights, turnover/revenue) to prevent a high level of horizontal concentration of ownership and/or control in this sector?     This question aims to assess the existence of regulatory safeguards (sector-specific) against a high horizontal concentration of ownership and/or control in the TELEVISION/RADIO sector.    

X

 

 

Is there an administrative authority or judicial body actively monitoring compliance with the thresholds in the print sector and/or hearing complaints? (e.g. media and/or competition authority)?     This variable aims to assess if the law/regulation provides a due monitoring and sanctioning system for the regulation on audiovisual media concentration.    

X

Does the law grant this body sanctioning/enforcement powers in order to impose proportionate remedies (behavioural and/or structural) in case of non-respect of the thresholds?    

The variable aims at assessing if the law is providing a due system of sanctions to sector-specific regulation, such as:

- Refusal of additional licences;

- Blocking of a merger or acquisition;

- Obligation to allocate windows for third party programming;

- Obligation to give up licences/activities in other media sectors;

- divestiture.    

0,5 (PCC entrusted to block M&A; third party programming for Filipino content)    

  

  

Are these sanctioning/enforcement powers effectively used?     This indicator aims to assess the effective implementation of sector-specific remedies against a high horizontal concentration of ownership and/or control in the television media.     High Risk (0)      

 

Total 

 5 of 8

 

PRINTDescriptionYesNoNAMD
Does the media legislation contain specific thresholds or limits, based on objective criteria (e.g. number of licenses, audience share, circulation, distribution of share capital or voting rights, turnover/revenue) to prevent a high level of horizontal concentration of ownership and/or control in this sector?     This question aims to assess the existence of regulatory safeguards (sector-specific) against a high horizontal concentration of ownership and/or control in the PRINT sector.    X
Is there an administrative authority or judicial body actively monitoring compliance with the thresholds in the audiovisual sector and/or hearing complaints? (e.g. media and/or competition authority)?     This variable aims to assess if the law/regulation provides a due monitoring and sanctioning system for the regulation on print media concentration.     X
Does the law grant this body sanctioning/enforcement powers in order to impose proportionate remedies (behavioural and/or structural) in case of non-respect of the thresholds?    

The variable aims at assessing  if the law is providing a due system of sanctions to sector-specific regulation, such as:

- Refusal of additional licences

- Blocking of a merger or acquisition;

- Obligation to allocate windows for third party programming;

- Obligation to give up licenses/activities in other media sectors 

- divestiture 

X
Are these sanctioning/enforcement powers effectively used?     This indicator aims to assess the effective implementation of sector-specific remedies against a high horizontal concentration of ownership and/or control in the television media.        X
Total    1 of 1
InternetDescriptionYesNoNAMD
Does the media legislation contain specific thresholds or limits, based on objective criteria (e.g. number of licenses, audience share, circulation, distribution of share capital or voting rights, turnover/revenue) to prevent a high level of horizontal concentration of ownership and/or control in this sector?     This question aims to assess the existence of regulatory safeguards (sector-specific) against a high horizontal concentration of ownership and/or control in the online/ISP sector.    X
Is there an administrative authority or judicial body actively monitoring compliance with the thresholds in the online sector and/or hearing complaints? (e.g. media and/or competition authority)?     This variable aims to assess if the law/regulation provides a due monitoring and sanctioning system for the regulation on online/ISP media concentration.     0,5    
Does the law grant this body sanctioning/enforcement powers in order to impose proportionate remedies (behavioural and/or structural) in case of non-respect of the thresholds?    

The variable aims at assessing if the law is providing a due system of sanction to sector-specific regulations, such as:

- Refusal or additional licences;

- Blocking of a merger or acquisition;

- Obligation to allocate windows for third party programming;

- Obligations to give up licences/activities in other media sectors;

- divestiture 

0,5
Are these sanctioning/enforcement powers effectively used?     This indicator aims to assess the effective implementation of sector-specific remedies against a high horizontal concentration of ownership and/or control in the television media.    X
Total 1 of 3
Media MergersDescriptionYesNoNAMD
Can a high level of horizontal concentration of ownership and/or control in the media sector be prevented via merger control/competition rules that take into account the specificities of the media sector?    

This question aims to access the existence of regulatory safeguards (sector specific and/or competition law) against a high horizontal concentration of ownership and/or control in the media sector through merging operations: 

- By containing media-specific provision that impose stricter thresholds than in other sectors;

- The mandatory intervention of a media authority in merger and acquisition cases (for instance, the obligation for the competition authority to ask the advice of the media authority);

- The possibility to overrule the approval of a concentration by the communication authority for reasons of media pluralism (or public interest in general), that - even tough they do not contain media-specific provisions - do not exclude the media sector from their scope of application. 

X
Is there an administrative authority or judicial body actively monitoring compliance with rules on mergers and/or hearing complaints? (e.g. media and/or competition authority)?     This variable aims to assess if the law/regulation provides a due monitoring and sanctioning system.     0,5 (PCC)    
Does the law grant this body sanctioning/enforcement powers in order to impose proportionate remedies (behavioural and/or structural) in case of non-respect of the thresholds?    

The variable aims of assessing if the law is providing a due system of sanctions to sector-specific regulation, such as; 

- Blocking of a merger or acquisition; 

- obligation to allocate windows for third party programming;

- Obligation to give up licences/activities in other media sectors;

- divestiture

0,5 (PCC)    
Are these sanctioning/enforcement powers effectively used?     This indicator aims to assess the effective implementation of sector-specific remedies against a high horizontal concentration of ownership and/or control in the television media.    X
Total 1 of 3

 Sources: 

Media Ownership Monitor Legal Assessment (2016), Romel R. Bagares
Interview with NTC (2016)
How to get a media license

Cross-media Ownership Concentration

This indicator aims to assess the concentration of ownership across the different sectors – TV, print, audio, and any other relevant media – of the media industry. Cross-media concentration is measured by adding up the market shares of the top media companies.

Result

Cross-Media ownership concentration is HIGH, as the two biggest media companies – ABS-CBN Inc. and GMA Network – are active, popular and profitable across all media sectors.

Why?

  • ABS-CBN Corporation and GMA Network Incorporated are without a doubt the front runners of the media market. They together gather a market share of 79.44 percent. The top 8 companies operating cross-media (which means in at least two media sectors) get almost all of the cake (96.46 percent).
  •  Even if advertising budgets was not available for all media, the trend shows that the Big Two also benefit from selling advertising space, with most money coming from TV (Nielsen, Ad Spending).
  • Business tycoon Manuel V. Pangilinan is involved in all media sectors through his MediaQuest Holdings Incorporated that holds TV5 Network Incorporated (TV, radio, online), Nation Broadcasting Corporation (radio, TV) and Hastings Holdings (print). However, based on 2014 data, Pangilinan’s media companies are unable to keep pace with the major players financially. TV5 Network Incorporated is operating at a loss  ($-82,43 million). His telecommunication companies however balance the loss as PLDT and Smart Communications have a revenue of $3652 million, a profit of around $569 million. 

Note: The market shares are a proxy. Normally, market shares are computed by dividing the companies’ total revenues by the media industry's total revenue over a fiscal period. As the media industry’s total revenue was not available, the revenues of the 29 companies included in our research were added and set as 100% market share. Information from their official Securities and Exchange Commission (SEC) Documents was used. For most companies, data for the Fiscal Year 2015 was available. Operating Profit was calculated as Net sales - Cost of goods sold - Operating expenses. 

    Score:

    LOW (1)MEDIUM (2)HIGH (3)

    Percentage: 96,94%

    Percentage Top 2: 79,44%

    If within one country the major 8 owners (Top8) have a market share below 50% across the different media sectors.  If within one country the major 8 owners (Top8) have an audience share between 50% and 69% across the different media sectors.  If within one country the major 8 owners (Top8) have a market share above 70% across the different media sectors. 
    Sources:

Overview Media Market based on SEC documents
GROWTH OF AD SPEND IN Q2 (2016), The Nielsen Company (Philippines) Inc.

Regulatory Safeguards: Cross-media Ownership Concentration

This indicator aims to assess the existence and effective implementation of regulatory safeguards (sector-specific and/or competition law) against a high degree of cross-ownership between media types (press, TV, radio, internet).

Results

There is very limited regulation that affects cross-media ownership, which is ultimately not preventing cross-media concentration. Therefore a HIGH RISK for market distortion through cross-media concentration exists.

Why?

  • The Telecommunications Policy Act (1995) provides that a single entity cannot engage in both telecommunications and broadcasting under a single franchise. But this does not prohibit a single entity from getting a telecommunications franchise separately from a broadcasting franchise.  As internet and online media is not defined as mass media, cross-ownership monitoring does not consider online outlets.
  • There is no authority actively monitoring cross-media ownership.  The Philippine Competition Commission (PCC) could monitor and break up monopolies. But as there is no political or juridical awareness for that phenomenon of cross-media-concentration, effective merger control in Philippine media market is missing.
  • Due to that lack of regulation, cross-media-ownership empires as the one of Manuel V. Pangilinan or media empires such as ABS-CBN or GMA could develop.

Regulatory Safeguard Score:

1.5 out of 6– High Risk (Regulation: 25 %).

1 = media-specific regulation/ authority

0.5= competition-related regulation/ authority

CROSS-MEDIA OWNERSHIPDescriptionYesNoNAMD
Does the media legislation contain specific thresholds, based on objective criteria, such as number of licences, audience share, circulation, distribution of share capital or voting rights, turnover/revenue, to prevent a high degree of cross-ownership between the different media?     This indicator aims to assess the existence of regulatory safeguards (sector-specific and/or competition law) against a high degree of cross-ownership in different media sectors.    X
Is there an administrative authority or judicial body actively monitoring compliance with these thresholds and/or hearing complaints? (e.g. media authority=1, competition authority=0,5))     This variable aims to assess if the law/regulation provides a due monitoring and sanctioning system for the regulation on audiovisual media concentration.     0,5 (PCC)    
Does the law grant body sanctioning/enforcement powers in order to impose proportionate remedies (behavioural and/or structural) in case of non-respect of the thresholds?    

The variable aims at assessing if the law is providing a due system of sanctions to sector-specific regulation, such as:

- Refusal of additional licences;

- Blocking of a merger or acquisition;

- Obligation to allocate windows for third party programming;

- Obligation to give up licences/activities in other media sectors

- divestiture.

X
Are these sanctioning/enforcement powers effectively used?    

the relevant authority never uses its sanctioning powers

The question aims at assessing the effectiveness of the remedies provided by the regulation.    
X
Can a high degree of cross-ownership between different media be prevented via merger control/competition rules that take into account the specificities of the media sector?    

For instance, cross-ownership can be prevented by comptetion law:

- by the mandatory intervention of a media authority in M&A cases (for instance, the obligation for the competition authority to ask the advice of the media authority);

- by the possibility to overrule the approval of a concentration by the competition authority for reasons of media pluralism (or Public interest in general);
 Even though the law does not contain media-specific provisions - it does not exclude the media sector from its scope of application
X
Is there an administrative authority or judicial body actively monitoring compliance with these rules and/or hearing complaints? (e.g. media and/or competition authority)     This variable aims to assess if the law/regulation provides a due monitoring and sanctioning system for the regulation against a high degree of cross-ownership in different media sectors via merger control/competition rules     X
Does the law grant body sanctioning/enforcement powers in order to impose proportionate remedies (behavioural and/or structural) in case of non-respect of the thresholds?    

Examples sanctioning/enforcement powers and remedies:

- blocking of a merger or acquisition;

- obligation to allocate windows for third party programming;

- must carryobligation to give up licences/activities in other media sectors;

- divestiture. 

X
Are these sanctioning/enforcement powers effectively used?     The question aims at assessing the effectiveness of the remedies of the regulation.    no
Total (Mean of L-e und L-I sub-indicators)     1.5 of 6    

Ownership Transparency

This indicator assesses the transparency of data about the political affiliations of media owners as ownership transparency is a crucial precondition to enforce media pluralism.  

Result:

Companies registered in the Philippines have to disclose their ownership structures to the Securities and Exchange Commission (SEC), where that information can be purchased. In order to complete missing data which was neither available online nor offline (SEC documents), all media outlets and companies were contacted with a list of follow-up questions. In total, ownership transparency is at a MEDIUM level.

Why?

    The Media Ownership Monitor was analyzing publicly available data, both online and offline (SEC documents). In order to complete missing data, all media outlets and companies were contacted with a list of follow-up questions. The result for the 43 analyzed and contacted media outlets: 

    • For the majority – 27 - of the media outlets and related companies, ownership data was at least publicly available at the SEC. It was in some cases not updated annually.
    • 11 media outlets were considered as passively transparent – which means representatives of their mother companies reacted to follow-up questions and were open to talk to the research team .
    • Actively transparent were only media outlets that belong to stock-listed companies, which are legally obliged to inform proactively and comprehensively about its ownership on the website or in the newspaper. This concerned 8 of the outlets, amongst them ABS-CBN, GMA, Manila Bulletin Publishing and Manila Broadcasting Company. 
    • For one media outlet, data was unavailable – the companies neither responded, nor did a public record exist.
    • No company actively disguised the ownership structure, e. g. through bogus companies.
    LOW (1)MEDIUM (2)High (3)

    How would you assess the transparency and accessibility of data about the media ownership?

    Data on media owners as well as their political affiliations is publicly available and transparent.

    (Active Transparency)

    Code if that applies to > 75% of the sample

    Data of media owners and their political affiliations are disclosed based on investigations of journalists and media activists or upon request.

    (Passive Transparency)

    Code if that applies > 50% of the sample. 

    Data on political affiliations of media owners are not easily accessible by the public and investigative journalists of activists are not successful in disclosing these data.

    (Data Unavailable, Active Disguise)

    Code if data is available for < 50% of the sample 

     

     

    Regulatory Safeguards: Ownership Transparency

    This indicator aims to assess the existence and effective implementation of transparency and disclosure provisions with regard to media ownership and/or control.

    Result:

    Even though they are no specific laws on ownership transparency, general transparency regulations also apply for the media sector (TV, radio, print, online).  While these laws do not prevent complex layering of company structures, media companies at least submit information on their ownership structures, which are easily accessible. This means all in all a MEDIUM RISK to media ownership transparency.

    Why? 

    •  Setting up a company requires the registration as a franchise as the Securities and Exchange Commission (SEC). As of then, companies have to submit annually both a Financial Statement (FS; includes e.g. revenues, profits, capital stock etc.) and General Information Sheets (GIS; ownership structures & shares, information about executive and non-executive boards etc.). Those data can be purchased at the SEC. Corporations that are listed at the stock market are additionally obliged to disclose their ownership structures on their websites.
    • Sanctions in case of non-respect of disclosure obligations could be theoretically imposed and brought to court – however, there has notably been no case. 
    • Even though these regulatory safeguards promote ownership transparency, it tends to be superficial as the practice of layering company structures to obscure ultimate beneficial owners is common. Those complex structures are legal and can theoretically be delayered – which however requires insight and an immense effort. Roberto Tiglao for example spared no effort to shed light on Manuel V. Pangilinan’s empire and to trace it back to a foreign investor.
    • A major step back is the abolition of the “reverse search” with the implementation of the Data Privacy Act. The reverse search allowed until recently searching media owners, meaning to get information on all shares they hold in other business. In August 2016, the SEC rejected VERA Files request for reverse research. 

    Regulatory Safeguard Score: 

    14 out of 20 - Medium Risk (70%).

    Transparency Provisions (summarized for TV, Radio, Press, Online - max. score 5 per sector)DescriptionYesNoNAMD
    Does national (media, company, tax...) law contain transparency and disclosure provisions obliging media companies to publish their ownership structures on their website or in records/documents that are accessible to the public?     The aim of the question is to check regulatory safeguard for transparency towards the citizens, the users and the public in general. X
    Does national (media, company, tax...) law contain transparency and disclosure provisions obliging media companies to report (changes in) ownership structures to public authorities (such as the media authority)?     The aim of the question is to check regulatory safeguard for accountability and transparency towards public authorities.    X
    Is there an obligation by national law to disclose relevant information after every change in ownership structure?     This question aims at assessing if the law provides rules on the public availability of accurate and up-to-date data on media ownership. This is a condition for an effective transparency.    X
    Are there any sanctions in case of non-respect of disclosure obligations?     This question aims at assessing if the law on media ownership transparency can be enforced through the application of sanctions.    X
    Do the obligations ensure that the public knows which legal or natural person effectively owns or controls the media company?     This question aim at assessing the effectiveness of the laws that deal with media ownership transparency and if they succeed in disclosing the real owners of the media outlets.    
    Medium: some owners are still unknown (=0,5)
    Total14 out of 20 

    Sources:

    Republic Act no. 10173. The Data Privacy Act (2012), Congress of the Philippines
    Colossal Deception - How Foreigners Control our Telecom Sector (2016), Roberto Tiglao

    (Political) Control Over Media Outlets and Distribution Networks

     This indicator assesses the risk of political affiliations and control over media and distribution networks. It also assesses the level of discrimination by politically affiliated media distribution networks. Discriminatory actions would for example include unfavorable pricing and posing barriers to media accessing the distribution channel. Political Affiliations means that the media outlet or company belongs to a party, a partisan group, a party leader or a clearly partisan person.

    Result 1: Political control over media outlets

    The overall level of (political) control over media outlets and distribution networks was assessed as a LOW RISK to media pluralism.

     Why?

    There are connections between the elite ruling politics and business elite that are behind media companies, which also include the popular media outlets and companies such as ABS-CBN and GMA Network. However, those networks are not owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation. Some family members of the big media companies might be involved in politics – in that case, however, they mostly left their management positions and focused on the political career. Both media companies and media owners learned from the post-Marcos history, when e.g. president Estrada attempt to strangle media companies backfired. At the moment, the listed indirect links do not lead to targeted discriminatory actions, so that political control over media outlets is assessed as low. It could pose a potential risk to media as soon as the political elite start to exploit the vulnerability of media owners. To what extent those links influence the media coverage on certain topics still needs to be explored via content analysis.

    • The Belmonte Family: Feliciano Belmonte, Sr. is the representative of the 4th district of Quezon City. He also served as a House Speaker during the previous administration. He has shares in Philippine Star and Pilipino Star Ngayon. He is the father of Philstar president Miguel Belmonte.
    • Manila Bulletin: some of the board members of served as cabinet members of past administrations.
    • The Lopez Family: Regina Paz “Gina” Lopez is the current Department of Environment and Natural Resources Secretary, a cabinet position to which she was appointed by President Rodrigo Duterte. She is the daughter of Eugenio Lopez Jr. and sister of Eugenio Lopez III. Was also appointed by former President Benigno Aquino III chairperson of the Pasig River Rehabilitation Commission. Eugenio “Geny” Lopez Sr., ABS-CBN founder, was the son of former Iloilo governor Benito Lopez and the elder brother of former Vice President Fernando Lopez.
    • Manuel M. Lopez is the fourth child of Lopez Group founder Eugenio H. Lopez Sr. and was a Philippine Ambassador to Japan appointed by former President Benigno Aquino III
    • Michael John R. Duavit is the son of Gilberto M. Duavit Sr. and brother of Gilberto R. Duavit Jr., he was elected to GMA Network, Incorporated’s Board of Directors in 2015 and was elected Representative of the First District of Rizal from 2001 to 2010 and again in 2016Gilberto M. Duavit Sr. was also elected Representative of the First District of Rizal in 1994. Duavit was elected member of the 9th, 10th, and 11th Congresses, representing the 1st District of Rizal. During his tenure in Congress, he served as Senior Assistant Minority Floor Leader (10th Congress) and Chairman of the House Committee of Appropriations (11th Congress) after becoming a member of the same House Committee (9th and 10th Congress
    • Emmanuel Joel Villanueva, is an incumbent senator of the Republic of the Philippines and son of GMA News TV co-owner Christian pastor Eduardo Villanueva.
    • No political affiliations for Iglesias ni Cristo’s Eduardo V. Manalo but they practice bloc voting and they are said to recommend appointees to key government positions.

     

     

    LOW (1) MEDIUM (2) HIGH (3)
    POLITICATION OF MEDIA OUTLETS    
    What is the share of TV media owned by politically affiliated entities? 
    The media having <30% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.     The media having <50% - >30% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.  The media having >50% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.    
    What is the share of Radio channels owned by politically affiliated entities? 
    The media having <30% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.     The media having <50%>30% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.  The media having >50% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.    
    What is the share of Newspapers owned by politically affiliated entities? 
    The media having <30% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.     The media having <50%>30% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.  The media having >50% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.    
    What is the share of Online media owned by politically affiliated entities? 
    The media having <30% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.     The media having <50%>30% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.     The media having >50% audience share is owned (controlled) by a specific political party, politician or political grouping, or by an owner with specific political affiliation.    

    Result 2: Political control over media distribution networks

    The overall level of (political) control over media outlets and distribution networks was assessed as a medium risk to media pluralism. A leading distribution network is defined as a network covering more than 15% of the national market. The political control over leading distribution networks is LOW - as they are either internationally based or are run as businesses rather than public utilities. The print distribution network is an exception: the Philippines Postal Corporation is a state corporation, which however does not discriminate against certain media outlets. Apart from that, the distribution networks do not show direct or indirect links to a political party or even more so to politicians.

    Why?

    Distribution networks for print publications is The Philippine Postal Corporation (PHLPost), a government-owned and controlled corporation responsible for providing postal services in the Philippines, was created by virtue of Republic Act No. 7354, otherwise known as the Postal Service Act of 1992. It has however so far not taken any discriminatory actions towards any print outlet.

    Radio and TV Networks are directly related to the frequencies that are distributed by National Telecommunications Commission (NTC), which is a governmental body. But the technical distribution networks, the satellite and cable technologies, are independent from the government. The two biggest networks, ABS-CBN  and GMA Radio Television Arts are linked with the US-based Pan American Satellite (PANAMSAT) and Palapa B2P (communication satellites owned by Indosat, an Indonesian telecommunication company), which makes their programs available to all cable operators and direct to home markets within the satellites footprints.

    Internet Service Providers are the distribution networks behind the Internet. Thus, the leading online distribution networks are PLDT and Globe. Their owners do not have any political affiliations. In fact, according to an interview with the National Telecommunication Commission, there is no plan to invest in an alternative public broadband infrastructure as trying to compete with PLDT/Globe would be too costly for the government.

    LOW (1)MEDIUM (2)HIGH (3)
    How would you assess the conduct of the leading distribution networks for print media? 
    Leading distribution networks are not politically affiliated or do not take discriminatory actions.     At least one of the leading distribution networks is politically affiliated or takes occasional discriminatory actions.     All of the leading distribution networks are politically affiliated and has a record of repeated discriminatory actions.    
    How would you assess the conduct of the leading radio distribution networks? 
    Leading distribution networks are not politically affiliated or do not take discriminatory actions.     At least one of the leading distribution networks is politically affiliated or takes occasional discriminatory actions.     All of the leading distribution networks are politically affiliated and has a record of repeated discriminatory actions.    
    How would you assess the conduct of the leading television distribution networks? 
    Leading distribution, are not politically affiliated or do not take discriminatory actions. At least one of the leading distribution networks is politically affiliated or takes occasional discriminatory actions.  All of the leading distribution networks are politically affiliated and has a record of repeated discriminatory actions. 
    How would you assess the conduct of the leading Internet distribution networks? 
    Leading distribution networks are not politically affiliated or do not take discriminatory actions. At least one of the leading distribution networks is politically affiliated or takes occasional discriminatory actions.  All of the leading distribution networks are politically affiliated and has a record of repeated discriminatory actions.  

    (Political) Control Over Media Funding

    This indicator assesses the influence of the state on the functioning of the media market, focusing particularly on the risk of discrimination in the distribution of state advertisements. The discrimination can be reflected in favoritism towards political parties or affiliates of political parties in the government, or in penalization of media criticizing the government. State advertising is understood as any advertising paid by governments (national, regional, local) and state-owned institutions and companies.

    Results:

    While there are rules for distribution of state advertising (public bidding), there is no data on compliance. The influence of state funding on the media market is thus highly intransparent, which creates a HIGH RISK. Additionally, there is still media organized as governmental owned and controlled corporation (GOCC), which benefit financially from capital stock guaranteed by the law.

    Why?

    • Under the new Government Procurement Reform Act, procurement of all goods and services – including that of advertising space – should undergo public bidding. This aims at preventing that State advertising is distributed exclusively to few media outlets, but spent in public interest.
    •  These regulations are, however, hardly enforced or implemented. Government agencies are required to publish bids on their websites as well as in newspapers of general circulation – which is not done. The Commission of Audit (CoA) is obliged to disclose those bidding processes and justify how state funding is spent – which is also not done. There is no monitoring done to be able to crackdown on violations.
    • A known fact is, that governmental funding increased the authorized capital stock of the state-owned People’s Television Network from PhP1 billion to PhP6 billion and gave it the authority to collect commercial revenues (Republic Act 10390, March 2013). This shows a disproportionate distribution of state advertising (in terms of audience share) to the media, as the governmental channels reach less audience than other channels.
    LOW (1)MEDIUM (2)HIGH (3)
    Is the state advertising distributed to media proportionately to their audience share? 
    State advertising is distributed to the media relatively proportionately to the audience shares of media. State advertising is distributed disproportionately (in terms of audience share) to the media.State advertising is distributed exclusively to few media outlets, which do not cover al major media outlets in the country. 
    How would you assess the rules of distribution of state advertising?    
    State advertising is distributed to media outlets based on transparent rules.     State advertising is distributed to media outlets based on a set of rules but it is unclear whether they are transparent.     There are no rules regarding distribution of state advertising to media outlets or these.   
    IMPORTANCE OF STATE ADVERTISING    

    What is the share of state advertising as part of the overall TV / Radio / Print/ online advertising market? 

    VALUE: There is no data available on the share of state advertising in the market.  

    Share of state advertising is <5% of the overall market.    Share of state advertising is 5%-10% of the overall market.     Share of state advertising is > 10% of the overall market.·  

    Sources: 

    Media Ownership Monitor Legal Assessment (2016), Romel R. Bagares
    Government Procurement Reform Act, Republic Act 9184
    Republic Act 10390, March 2013

    (Political) Control Over News Agencies

    This indicator assesses the range and independence of competing news agencies, including the assessment of the level of state ownership and level of independence of state owned news agencies.

    Result:

    Even if financial information on the news agency market is lacking and the indicator could only be partly evaluated, it overall shows a HIGH RISK. Even if international news agencies are a relevant source for media outlets, the only news agency with a primarily national focus and with direct access to political information is a government service.

    Why?

    • Most media outlets subscribe to international news agencies such as Reuters, Associated Press (AP) and Agence France Press (AFP). However, they are at most Manila-based.

      The only news agency with journalists and stringers all across the country is the Philippines News Agency (PNA). It is a web-based newswire service provided by Philippine government, launched 35 years ago. It employs about a hundred journalists and stringers across the country, that are deployed practically in every government office and agency, including the main offices and camps of police and security forces, to provide news 24/7 for local, regional and global subscribers and readers. 

    • Also, President Duterte announced (June 2016) that he would make his official announcements and statements solely through state media. The preparation, editing, and distribution of information concerning the executive branch are thus moving into the sole hands of the government.

      LOW (1)MEDIUM (2)HIGH (3)

      What is the market share of the leading news agency?

      VALUE: There is no market share for news agencies available.    

      No news agency dominates the market (occupy >30% of the market of news agencies).  One news agency has <50% ≥30% share of the market of news agencies.  The leading news agency has ≥50% market share.    
      How would you evaluate the political affiliation and/or dependence of the largest news agency? 
      None of the largest news agencies is dependent on political groupings in terms of ownership, affiliation of key personnel or editorial policy.     At least one of the largest news agencies is dependent on political groupings in terms of ownership, affiliation of key personnel or editorial policy.     Most or all of the largest news agencies is dependent on political groupings in terms of ownership, affiliation of key personnel or editorial policy.    
      Sources: 

    Duterte to make announcements only through state media (2016), Inquirer.net
    The Philippine News Agency (n.d.), Asia.net
    The Philippines (n.d.), Thomson Reuters
    The Philippine News Agency (n.d.)

    • Project by
      VERA Files
    •  
      Reporters without borders
    • Funded by
      BMZ