Fears raised as ABS-CBN ups rates with new booking rules

A new booking scheme by the Philippines' leading broadcaster has sparked fears that plans could be abused by larger media independents or companies with the resources to corner prime time slots. Launched in mid-October, the ABS-CBN pre-season booking plan requires advertisers and agencies to book space on a "non-cancellable" basis for 2001 before the end of this year. The station is planning a 20 per cent rate hike next year, but will grant early bookers a 10 per cent discount. However, agencies believe the pre-season buying plan will only benefit the growing pool of media independents, which have the resources to book early amid the troubled economic climate. "My concern is that the media independents might reserve a good portion of the inventory to the deteriment of medium and small-sized agencies," said Campaigns & Grey vice-president for media, Rina Bartolome. "The independents can always take the risk, reserve space and then pick up clients as they go along," she added. Several other medium-sized agencies echoed Ms Bartolome's comments. "Besides the media independents, you could even get financial companies buying up all the slots and then reselling the space at their asking price in the future," said the media director of a medium-sized agency. A newly-established media independent, however, insisted that the scheme was clear in discouraging brokering by agencies. She said the station had clearly-defined terms for both agencies and advertisers entering into its pre-season buying arrangement. In both instances, the media space purchased will be limited to the companies' historical volume with ABS-CBN plus a provision for a 2001 increase. ABS-CBN also requires signatories of the contract to be officers defined by their charter to enter into a purchase agreement with the station. Agencies are not required to identify advertisers who will be using the spot, but they can resell the pre-booked spots at the regular season rate to their clients. Likewise, advertisers are not required to identify brands which will be using the pre-booked spots, but they cannot resell the space to other advertisers. Said the media agency chief: "These are clear rules against brokering." Not all agencies were convinced: "ABS-CBN said it is not allowing brokering, but there is nothing to stop agencies from getting creative in how they dispose of the spots they pre-booked," said the media director of the medium-sized agency. It is understood that the station plans to pre-sell only 60 per cent of total inventory, leaving the remaining 40 per cent for walk-in advertisers. Agencies were also concerned that the station's 20 per cent rate hike would erode affordability levels for advertisers already suffering from a weakened economy and the peso's continued depreciation, as the corruption scandal continues to engulf President Joseph Estrada's administration. The Philippines' second-placed station, GMA, is looking at a 15 per cent hike for 2001. ABS-CBN justified the hike, saying it had expanded coverage to six provincial areas, which will give it a three per cent increase in reach. The station is estimated to have 43 per cent share of audience, while GMA is a distant second with a 24 per cent share. ABS-CBN announced the rate increase for 2001 as part of a package of initiatives to better manage its inventory. The station also plans to "dechain" programming from February 2001, allowing agencies and advertisers the flexibility of buying space at a national, cluster (Luzon, Visayas and Mindanao, the three main islands) and on a per-city basis.

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