RPN-9 to cut 200 jobs, may stop airing 'Newswatch'

MANILA, Philippines - Financial losses of TV network Radio Philippines Network (RPN) 9 will result in the retrenchment of 200 employees and uncertainties over its "Newswatch," one of the country's pioneer news programs.

In a press briefing on Tuesday, October 2, Presidential Communications Operations Office Secretary Herminio Coloma Jr. said his office will monitor the network's compliance to the Labor Code provisions in terminating the services of workers.

“The PCOO continues to supervise the operations and management of RPN and, as we have declared in all of our appearances and statements before both Houses of Congress, government is committed to protect the rights of the employees of RPN,” Coloma said.

Coloma's office, by virtue of Executive Order No. 4, oversees RPN-9, along with IBC-13 and PTV-4 and other government-owned or donor controlled media assets. Both RPN-9 and IBC-13 were among the assets that the government of former President Corazon Aquino sequestered after the Marcos dictatorship years.

The government, however, only has a minority 20% stake in RPN-9 following a previous court ruling, Coloma said.

Following capital raising and debt-to-equity deals to settle borrowings and obligations to employees totalling about P3 billion, the network is now controlled by Solar TV and Far East Managers and Investors Inc. (FEMII), an organization company affiliated with the late Ambassador Roberto Benedicto, and the San Miguel Corp.

'Newswatch' and job losses

Some employees of RPN 9 said “NewsWatch,” one of the country's pioneer news programs, would stop airing.

But a statement from RPN 9 officer-in-charge Robert Rivera said “we are business as usual here and we continue our dialog with union.”

“We continue to air NewsWatch until such time all concerned parties are duly notified, including some sponsors,” Rivera said.

The retrenchment came after the network decided to stop producing shows, as airtime had been assigned to blocktimers, namely Solar and ETC.

"Solar has been a block timer of RPN and, if you would see the programming now, there are only two hours more or less of news and public information that is not covered by the block time agreement," Coloma said.

He added that his office was informed by RPN management that it already issued letters or notices of retrenchment to some 200 employees of the network. The retrenchment program starts October 1 and will take effect in November.

According to the Labor Code, management is given a 30-day period to implement such notice. Based on the present collective bargaining agreement between RPN management and employees, the notice period is 45 days so the notices have already been issued.

“We continue to monitor the developments in RPN to ensure that all the rights of the employees under the Labor Code are adequately protected,” Coloma said.

Coloma has met with network's labor union to discuss network's financial fate and plans to be privatized. The network had about P2 billion worth of obligations to employees.

The union filed a strike notice to protest the reported shutdown of RPN. RPN did sign-off in February 2011 but only as part of the preparation for a relaunch and rebranding.

Ownership structure  

Coloma said one of the government’s representatives to the board, Tonypet Albano had resigned on Aug. 31. Only government representative remains: Lourdes “Deedee” Siytangco.

The government's stake stems from the government's sequestration of the stock and assets of RPN after the 1986 Edsa Revolution.

But in 2010, the Supreme Court ruled with finality that 32% of RPN was owned by FEMII.

In October of 2011, the new composition of the RPN Board reflected the equity structure as follows:


This new ownership structure came after a series of capital raising exercises, which led to the entry of other groups, including the Benedicto and San Miguel groups.

“All I know is that they were not able to attain profitable operations from the time that it was decided by the previous administration to allow the equity conversion of the Solar Group to the extent of 34%…My impression is they have not been operating profitably since the time Solar was allowed to do the debt-to-equity conversion,” Coloma explained.

Coloma said the conversion was allowed precisely because RPN 9 could not meet its contractual obligations to the employees, amounting to some P2 billion.

In a previous statement, RPN management said, "To keep its obligations, RPN management had struggled to raise funds needed to continue its operations and pay its employees regularly, using current revenue streams and borrowings, but to no avail. This unsustainable situation has resulted in years of unpaid debts and continuing financial losses."

Entry of Solar, ETC

RPN and Solar Entertainment Corp, which operates several cable channels in the Phlippines, entered into a partnership in March 2007. Both co-produced entertainment shows, including the local version of the Next Top Model franchise.

Management changes followed, with former Senator Orlando Mercado being named as president and CEO. Mercado's first major move was to expand the partnership with Solar Entertainment. The network went on an intense bidding war with ABS-CBN for the return of the Philippine Basketball Association (PBA) games to the network. RPN-9 would later end carrying PBA in 2011.

The network rebranded as C/S 9, and later as "Solar TV."

In 2011, additional RPN shares were sold to FEMII, increasing the group's stake.

Losing to ABS-CBN, GMA-7

RPN-9 acknowledged that the network "could not compete with the rest of the industry."

Its financial troubles started after the administration of former President Corazon Aquino sequestered some media assets, including RPN-9, and returned other networks, including ABS-CBN and GMA-7 to their current owners.

As ABS-CBN and GMA-7 re-launched and reformatted in the 1980's and 1990's, RPN-9 lost most of its viewership and its ratings slumped.

Its popular programs, including John en Marsha, Student Canteen, and Superstar were canceled, while daytime programs Eat Bulaga! moved elsewhere.

The network had a sort of re-birth when it broadcasted a Tagalog dub of the Mexican telenovela "Marimar."

RPN-9 operates several TV and radio stations nationwide. - Rappler.com