Despite losing the viewership battle in NUTAM, ABS-CBN Corp. is now back as the country's most profitable TV Network!
The Lopez-led conglomerate finished the 9-month period with a net income of P2.2 billion, higher than GMA's P1.58 billion, with TV5 still incurring multi-million net losses. This is the second consecutive year ABS-CBN bested GMA in both profits and ad revenues after nearly a decade of GMA's dominance in profit making.
GMA's ad revenues started to wilt in 2010 when it raised its ad rates to match ABS-CBN's rate card following its victory in NUTAM. The rate increase proved detrimental to the kapuso network as Advertisers decreased their product placements in GMA's Prime time line-up and redirected it to the station's afternoon programs with higher viewership but with lesser rates. Advertisers have focused their ad placements to more cost efficient programs with higher national viewership like ABS-CBN's Primetime Bida and TAPE's Eat Bulaga. This has caused GMA's revenues to drop as airtime revenues from prime time which accounts for 60% of its consolidated revenues dropped.
GMA's strategy in the past decade to impose cheaper rates to attract volume ads seemed to prove better for the firm than following ABS-CBN's approach of imposing lesser commercial airtime with expensive rates.
In Q3 ABS-CBN earned P562 million in net income versus GMA's P525 million, this despite of ABS-CBN's gargantuan Operating expenses.
Article by : TV NETWORK WAR