NTC asks Star Group to allow Destiny to continue carrying prime channels

The National Telecommunications Commission has asked the Star Group, which owns five of the top cable channels, to allow Destiny Cable to continue carrying Star’s programs, following the latter’s unilateral decision to disallow the airing of ESPN, Star Movies, Star World, Star Sports, and National Geographic over Destiny starting Oct. 14.

Star’s decision to terminate the five channels from Destiny comes at a time when the National Basketball Association and Major League Baseball world series are upcoming and the National Football League season has just began. It will be recalled that Star pulled the plug on Sky Cable and Home Cable last year for non-payment of debts around the same time of the year.

The Star Group accounts for 100 percent of the content of many provincial cable operators, and in the case of the bigger operators like Destiny, Sky Cable and Home Cable, around 25 percent of what they carry in terms of paid channels. "Thus, the Star can choose who lives or dies," according to the Philippine Cable Television Association (PCTA) president Manuel Dabao whose group includes the three major players.

Destiny is the second largest cable operator in the country with operations mainly in Metro Manila. The bulk of the market (around 60 percent) still goes to Sky Cable and Home Cable which have merged last year. Destiny, however, is the only one that got the letter from Star.

"Any effort to limit the access of program channels to a select few is deemed unfair, discriminatory, and promotes monopolistic business practices. Your action of cutting off from Destiny premium programs without any valid justification may result to monopoly and unfair competition considering that it may give undue advantage to the other major CATV service provider," NTC Commissioner Elisco Rio said in his letter to the Star Group.

This developed as Destiny Cable chairman Elena Lim and president David Lim said that they are considering going to court to stop Star from pulling the plug on Destiny and to ask both the executive and legislative branches of government to investigate the matter.

Mrs. Lim said that after maintaining a good business relationship since 1996 and no financial liability whatsoever, Star without any explanation just decided in a letter dated Oct. 3 that it will terminate the five main channels but continue the 12 minor ones – Star Movies Mandarin, Viva Cinema, Channel V Int’l., Adventure One, Fox News, Sky News, Channel V Mandarin, Phoenix Chinese Channel, Phoenix Info News, Star Plus (Hindi), Channel V (Hindi), and Star Gold (Hindi).

Destiny, following receipt of the letter from Star, asked for an explanation, but according to Destiny officials, it merely reiterated its decision to terminate the five channels without offering to explain why.

Rio, in his letter dated Oct. 7 to Star Regional Private Ltd. director Charles Pollard, warned the Star Group that failure on the latter’s part to allow Destiny to continue carrying the five programs will ‘result to an inquiry by the commission to determine whether such actions by a program provider constitute unfair and discriminatory acts that may lead to monopoly or unfair competition.’

Rio, whose resignation took effect Oct. 8, said the results of such an inquiry may merit legal action and referral to the congressional committee on transportation and communications.

The NTC, in its letter, emphasized to Star that it strongly supports the policy of fair play and non-discrimination in the Philippine cable television industry and that its position is that a program provider must make its program channel offering available to all industry members.

For his part, Dabao said the termination of the contract is arbitrary. "The association will not tolerate exclusivity of programs in the Philippines. We agree with the NTC that program providers should not be given the opportunity to choose which player to give since this promotes monopoly," he said.

There had been reports that in exchange for paying their debts to the Star Group, non-payment of which led to the termination of their relationship for six months starting Oct. 2001, Sky and Home asked for exclusivity to air the five Star channels. Dabao said he asked officials of Sky and Home if this was true, but they denied it.

The PCTA wrote Pollard also asking for an explanation but has yet to receive a response. "If they continue with their plan, we can even call for an industry boycott of Star, which will mean that they will no longer have any business in the Philippines," Dabao said.