The Philippine Competition Commission (PCC) has published a study examining the blocktiming practices in the free TV industry to assess the effects to competition of industry developments.
The study, titled “Blocktiming Practices in the Philippine Free TV Industry”, also found that the rise of over-the-top (OTT) platforms such as Netflix and YouTube is helping mitigate the potential anti-competitive effects by providing alternative distribution channels for content producers and promoting diverse programming options for viewers.
“These services have adapted to cater to different viewers and offer diverse value propositions for content producers,” the PCC study said.
Blocktiming refers to agreements wherein content producers buy airtime (or “blocks” of time) from TV networks to broadcast their programs and content.
The study observed an increase in market concentration following the non-renewal of ABS-CBN’s franchise.
GMA Network now commands roughly 93% of the free TV market. The study evaluated the ability of a dominant network to engage in input foreclosure, which occurs when a TV network refuses to offer time slots to content producers that are not affiliated with the network; or when it charges exorbitant prices for time slots, making it difficult for non-affiliated content producers to secure them.
However, the study found that the existing industry practices disincentivize TV networks from foreclosing airtime. Most networks already prioritize airing their own content over blocktime agreements, as seen in their historical programming choices.
Foreclosing airtime could also reduce audience reach and make networks less attractive to advertisers, impacting revenue, according to the study.
“Since foreclosure strategies limit the range of aired television content, it may lead to a decrease in audience reach and reduce the number of potential advertisers and revenue-generating opportunities,” it said.