PLDT sets stage for entry into satellite TV

Telecommunications giant Philippine Long Distance Telephone Co. (PLDT) is setting the stage for its entry into the direct-to-home (DTH) satellite TV arena, in the process competing with Philippine Multi-Media Systems Inc. (PMMSI) owned by former PLDT chairman Antonio ‘Tonyboy’ Cojuangco.

PLDT officials said yesterday it is the company’s intention to be involved in the DTH business in the Philippines, adding that the firm is in discussions with GV Broadcasting Systems Inc., a local DTH licensee, and US DTH giant Echostar Communications for the purpose of exploring opportunities in this area on a joint venture basis.

PLDT is reportedly finalizing the deal with Echostar and GV Broadcasting in a bid to seal the deal by next month. "What’s left is the nitty-gritty aspect of the agreement. We are still discussing the structure of the agreement,’ PLDT president Napoleon Nazareno said.

PLDT resorted to acquiring GV Broadcasting’s franchise after negotiations to acquire PMMSI’s Dream Broadcasting, the country’s only DTH operator at present, bogged down. PLDT chairman Manuel Pangilinan has said Dream was overpriced, but sources from Cojuangco’s group revealed that price was not even an issue. 

Pangilinan earlier said that he pulled out of the cable TV business and instead wants to enter the DTH arena because the latter holds more promise, aside from the fact that he has no control over the CATV business as PLDT is only a minority stakeholder.

PLDT used to own Home Cable until it sold its facilities to Central CATV Inc. which owns Sky Cable. PLDT was paid in shares in Central CATV, resulting in PLDT having a 33.33 percent stake in Central and the Lopez group 66.67 percent. 

The conversion of a loan extended by ABS-CBN Broadcasting to Central CATV to equity resulted in an increase in the Lopez stake to more than 90 percent, and a reduction in PLDT’s to less than 10 percent.

There are, however, reports that the Lopezes are in talks with Cojuangco for a possible joint venture between Central CATV and PMMSI. This could pit Lopez and Cojuangco on one side against PLDT on the other.  

The Lopezes own Bayan Telecommunications (Bayantel), a competitor of PLDT in the fixed line and data business, as well as ABS-CBN Broadcasting, a major content provider. "The Lopezes can make life hard for PLDT’s DTH business in terms of content," an observer noted. 

PMMSI is also at loggerheads with GV Broadcasting after the former asked the National Telecommunications Commission (NTC) to junk GV’s petition to offer DTH "for lack of financial, technical and legal qualifications to undertake the intended service."

GV has filed a petition with the NTC for a certificate of public convenience to install, operate and maintain a digital mobile TV broadcasting in 35 areas nationwide. The company currently has a congressional franchise to install, maintain, and operate nationwide broadcasting stations and such other systems, facilities or structures for origination, reception, processing broadcast audio or video information.