"This partnership is a clear statement that we are welcoming disruption and embracing digital technology."
The nation’s largest telephone company, PLDT Inc., owner of Smart, and GMA Network (Channel 7), the largest television network, in terms of ratings and profits, have tied up to disrupt Philippine television. “It will involve the launch of game-changing innovations that will power the media giant’s digital transformation,” said GMA Network.
On Wednesday, Jan. 9, GMA Network announced that PLDT Smart Communications has signed up with GMA subsidiary GMA New Media Inc., for what was described as a “technology, content, and distribution agreement.”
GMA and PLDT have not provided details of the joint effort. The idea, it seems, is that GMA will provide content and PLDT will provide the medium to distribute that content. In the media business, content has become king, making television just an adjunct of this new media business. TV has become a go-anywhere medium—from your bedrooms and living rooms into your cars, clubhouses, resorts, even inside your toilets.
The press statement said the partnership signaled that PLDT would play a key role in delivering GMA’s media content across its nationwide telecommunications network.
As of Sept. 30, 2018, PLDT had 55.62-million prepaid cellular subscribers plus another 2.4-million postpaid subscribers.
With those assets, television instantly becomes digital because you need wireless technology to deliver content. Along with tv shows and news programs, wireless technology also delivers data, on top of regular texting, voice, and image delivery. PLDT has 1.859-million line broadband subscribers, 195,015 wireless broadband subscribers, plus 2.778-million landline subscribers.
“This partnership is a clear statement that we are welcoming disruption and embracing digital with open arms,” GMA Network chair and CEO Felipe L. Gozon said in the statement.
“By riding the wave of disruption with PLDT and Smart as partners, we will not only upgrade the quality of content we are producing but we are also setting the stage for a new age of digital television,” Gozon pointed out.
GMA’s tie-up with PLDT is significant because the latter operates TV5 and has a new tv setup called One—the functional merger of TV5, Philippine Star, and Businessworld.
GMA’s linkup with PLDT puts one over rival ABS-CBN which has what is called TV Plus—the service that provides television programs for free, wirelessly, using satellite technology captured by a digital box which is sold for P1,500 per unit.
For GMA, Smart and PLDT will sell GMA’s digital connector box which will be the size of a USB which can be attached to the TV set or anywhere it can receive a signal.
“As we transform our business from being a legacy telco into the premier and most trusted digital enabler in the country, this partnership will enable us to power GMA’s digital pivot and help deliver to our millions of fixed and wireless subscribers GMA 7’s unique and compelling content, as well as exciting new digital experiences to more Filipino families,” PLDT chairman and CEO Manuel V. Pangilinan said.
TV stations are required to go digital by 2023. The National Telecommunications Commission expects 95 percent of all households to have access to digital TV by then.
“This partnership is a clear statement that we are welcoming disruption and embracing digital with open arms. By riding the wave of disruption with PLDT and Smart as partners, we will not only upgrade the quality of content we are producing but we are also setting the stage for a new age of digital television,” said GMA CEO Gozon.
At the signing ceremony were: Gozon, Pangilinan, GMA Network President and COO Gilberto R. Duavit Jr.; GMA Network Executive Vice President and CFO Felipe S. Yalong; GMA Network’s Executive Committee vice chairman Joel G. Jimenez; NMI President and COO Judd Gallares; and NMI senior vice president and general manager Dennis Caharian.
Representing PLDT and Smart were Oscar Enrico A. Reyes, SVP and Head of Consumer Business–Market Development; Ernesto R. Alberto, EVP and Chief Revenue Officer; and Pangilinan.
In a recent column in BizNewsAsia, Ivy Lopez said “With the influx of online and TV choices, global consumers can watch shows and movies anywhere from any connected device. There is the video-streaming leader Netflix, followed by YouTube, premium cable TV, network TV, and video-on-demand [VOD].”
She wrote: “Netflix has upended traditional viewing habits of either going to the movies or watching at home. For a $10 unconditional monthly fee, viewers can watch on their connected phone, devices, computer, or TV. Subscribers can cancel at any time and this puts the pressure on Netflix to come up with guaranteed engaging content. Unlike HBO, which fills hours with B movies and reruns, Netflix only has shows that audiences want to watch and actually watch.
“Netflix has nimbly evolved with the video times. It began in 1997 as a $0.50 cent mail-in DVD rental without late fees, which quickly killed video rental giant Blockbuster. Then it quickly became a DVD subscription service. In 2007, Netflix added streaming video and VOD that viewers can watch from their phones and devices, which likely led to more cable cutters. Netflix quickly expanded outside the US and now produces its original movies and shows in 21 countries. It also translates foreign shows for US audiences.”
Netflix has become the world’s largest movie production company. Its 2018 movie budget: $13 billion, more than any other movie company.