Valuable frequencies up for grabs

Following Congress’ refusal to renew ABS-CBN Broadcasting Corp.’s franchise to operate television and broadcasting stations in the country, the million-dollar question of course is, what happens to the frequencies left behind by the Kapamilya network?

ABS-CBN’s franchise is embodied in Republic Act 7966, which came into effect in 1995. The law granted the company the franchise to construct, operate and maintain for commercial purposes and in the public interest, TV and radio broadcasting stations in and throughout the Philippines through microwave, satellite or whatever means, including the use of any new technologies in TV and radio systems.

The same law also provides that the grantee shall secure from the National Telecommunications Commission the appropriate permits and licenses for its station and shall not use any frequency in the TV or radio spectrum without having been authorized by the NTC. The franchise had a 25-year term.

We all know what happened after that. After the franchise expired last May 4, ABS-CBN had to get a new one. But the Committee on Franchises’ technical working group recommended the denial of the franchise application based on several grounds, including possible violation of the constitutional provision against ownership and management of mass media by foreigners, unlawful return of the assets to the Lopez family after Martial Law, violation of its franchise by operating a pay-per-view channel without prior NTC approval, unauthorized use of AMCARA’s legislative franchise, alleged labor law violations, questionable tax avoidance schemes, biased reporting, among others.

Of course there is nothing to prevent ABS-CBN from reapplying. Unfortunately, there is no assurance that assuming that they get the franchise, the network will be able to get the same TV and radio frequencies that it used to have.

TV and radio frequencies are valuable and scarce. Therefore, it is expected that there will be a mad race for the frequency being used by ABS-CBN Channel 2, which is on VHF and free to air. But again, anyone who wishes to use this frequency must have a valid legislative franchise.

Just recently, an online news website reported that businessman Mel Velarde is allegedly making a bid to take over Channels 2 and 23 through his publicly listed firm Now Corp., as well as for ABS-CBN’s radio frequencies dzMM 630 and MOR 101.9. It said that Velarde is banking on his ties to the Duterte administration as a leverage.

The report noted that Velarde’s pursuit is partly for personal reasons, having an axe to grind against the Lopez family, in particular against ABS-CBN chairman emeritus Gabby Lopez who forced him into retirement. Velarde, who started out as ABS-CBN news director, was also founder and GM of SkyCable. But instead of giving Velarde compensation, the report said that Gabby demanded payment of a P10-million loan that his father Geny Lopez gave Velarde in 1997.

But in a statement, Now Corp. and the Now Group (which includes Now Telecom and Now Cable) said that they have not applied with NTC to secure Channels 2 and 23. Now’s broadcasting affiliates have applied for radio frequencies and have filed applications for direct terrestrial television broadcast, and according to Now, it is very interested in TV and radio broadcasting because of its widespread coverage for news delivery, public information, and distance learning. In fact, Now – together with the Asian Institute of Journalism and Communication – has proposed to Congress the creation of a Philippine Public Broadcasting Station, which will be publicly owned, and will focus on development issues, including the pandemic. The Philippines is one of the few countries in the world without a public broadcasting station.

In the same statement, the Now Group said that Velarde is not interested in interfering in ABS-CBN’s affairs, nor does he have a score to settle with Gabby Lopez. According to Velarde, he has won all his legal battles in the Supreme Court against ABS-CBN, including the false claim that what he received was a loan, not a bonus.

According to Now, Velarde believes that he has reconciled with Gabby, having felt the warm and cordial reception during the wake of Gabby’s sister, Gina.

Velarde also said he is not a godfather to any of the children of presidential daughter Sara Duterte.

What’s interesting is the fact that while the said news website tried to portray Velarde as someone being favored by the Duterte administration, being a godfather to Sara’s child, the sister site of said website, in a succeeding report, claims that Velarde is a friend of politicians associated with the Aquino administration, including Vice President Leni Robredo. Now which is which?

Which begs the question: why is this website picking on Velarde and the Now Group, who and which are admittedly much smaller players compared to other bigger personalities who are undoubtedly close to the President, and some of whom have been involved in blocking ABS-CBN’s franchise renewal bid? Who stands to gain in reviving the old squabble between Velarde and the Lopezes, in portraying Velarde as a Duterte supporter one moment and an Aquino backer the next?

According to Velarde, although he supported Duterte’s candidacy in 2016, he has never relied on government to achieve his interests, nor does the present administration favor his companies. In fact, just last year, Now sued the NTC after the latter failed to act on the application for a certificate of public convenience of Newsnet, an affiliate of Now Corp., within the time frame required under the Ease of Doing Business Act.

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