GMA 7 retrenchment, shades of media convergence

The retrenchment of GMA 7 Cebu employees and talents engaged in the TV station’s morning show including employees in sister stations in Cagayan de Oro, Bacolod, Naga City and Ilocos was like a bombshell that filled newsrooms, online news and social media last Friday.  In Cebu City where the media community immediately rallies behind media practitioners involved in crisis situations, the reaction was quite emotional.

From what I gathered, local GMA employees had already gotten wind of the network’s move to “streamline” operations but up until Friday morning when a top network official arrived in the company of a lawyer to serve the formal notice, severance pay and quitclaim documents, nobody knew who would be laid off.

A little birdie in GMA told this corner that during lunchtime last Friday, many employees were not able to swallow their food, seeing colleagues like Jun Veliganio looking forlorn after talking with network officials.  Tears were shed and many approached Bobby Nalzaro, Program Director of DYSS, asking for a slot in the radio station but there was nothing much he could do.

The specter of retrenchment had been hanging like the sword of Damocles over  GMA 7 employees for the longest time ever since reports came out in 2001, 2004 and 2012 that top network honchos were having talks with PLDT President Manuel V. Pangilinan.

The supposed takeover of one of the biggest TV networks in the country by MVP, also known as the original Pacman for his legendary boardroom takeovers, became the staple of gossip in business circles.

READ: GMA 7 job cuts ‘not related to Ang talks’

However, negotiations fell through because MVP allegedly failed to come across with respect to the price tag.  Moreover, the regulatory paperwork was a problem because San Miguel Corporation which MVP represented in the negotiations is 9% owned by foreign interests.  The 1987 Constitution provides that media entities in the Philippines should be wholly owned by Filipinos.

Sometime in 2013, MVP practically ditched any more talks with GMA 7 saying he was “already tired.”  I can imagine that network employees heaved a sigh of relief, as if a thorn had been pulled out  from their collective body.

The top management of GMA 7 justified the retrenchment of some 200 employees, stating this is in line with efforts at streamlining operations.  Unless one is totally clueless about what’s happening in the business world, these developments only reflect new directions spurred by the reported entry of Ramon S. Ang in the board of the GMA Network Company.

The President of San Miguel Corporation is now a kapuso, after gaining a board seat in the TV network.  The deal with GMA 7 was one biggest buy-ins in 2014, with Mr. Ang gaining 30% minority stake for a whopping P15.3 billion.

According to my source, RSA was being talked about by network employees who were terribly taken aback by the precipitate move. I hate to say this, but it looks like they are collateral damage in the trend in media and telecom industries called media convergence.

READ: GMA retrenches 200 staff to ‘streamline’ reg’l stations

The phenomenon is described in web resources as involving the “interconnection of information, communications technologies, computer networks and content — a direct consequence of the digitization of media and the prevalence of Internet connections.”

According to author Lala Rimando, “It isn’t enough anymore to have a business producing content, like news and entertainment and blasting these to TV screens of Filipinos here and abroad. Viewers are, more and more, watching and following content – video, text, photos – on smaller screens, such as their mobile phones and tablets, and accessing them via social media. A stand-alone media group will not survive in the future without a telecommunications or cable partner, so say industry watchers.” (The love story of GMA 7, Pangilinan and Ang, RapplerJune 25, 2014)

Media convergence is at the core of Media Quest Holdings’ (of the Philippine Long Distance Telephone PLDT Group) takeover of media establishments like ABC TV 5, Nation Broadcasting, Cignal Digital and at least 3 broadsheets.  The takeover of GMA 7 would have placed PLDT at the very top of the Philippine media and telco totem pole.

Meanwhile, Mr. Ramon Ang brings with him interests in a number of telecom and media establishments, like Solar TV.  Solar TV or the defunct RPN 9 used to be owned by Wilson Tieng but is now reportedly controlled by former Ambassador Antonio Cabangon Chua, who also owns a business broadsheet.  Reports say RSA also has interests in Liberty Telecoms Holdings Inc., a joint venture with Ooredoo (formerly known as Qatar Telecom).

I hope my media colleagues, after recovering from the initial shock, will understand that the rearrangement of priorities in the network merely paves the way towards a media convergence.  They need to be patient and continue to hone their craft in the context of fast-changing technology because there will be a lot of opportunities, whether in or out of the network.

I agree with an online commenter, don’t badmouth the network because they might just give you a call in the very near future.