CNN Philippines to cease operations starting Jan. 31
TELEVISION network CNN Philippines will cease operations beginning Jan. 31 due to significant financial losses, its operator Nine Media Corp. (NMC) announced on Monday.
“It is with deep regret that the management of Nine Media Corp. announces the discontinuation of its news and production operations on all media platforms, branded as CNN Philippines (CNNPH),” the company said in a statement.
Despite efforts to adapt to the changing media landscape, financial losses prompted this move, according to the company.
CNN Philippines started operating on free TV in March 2015 through an airtime deal with Radio Philippines Network, costing P8.2 million monthly. NMC reported a financial loss of P5 billion.
Toby Allan C. Arce, head of sales trading at Globalinks Securities and Stocks, Inc., said that CNN Philippines’ closure will likely impact listed media companies if the shutdown is deemed as a broader trend in the media industry and may lead to risk for some investors.
“If the shutdown is perceived as an isolated incident due to specific issues faced by CNN Philippines, it may not have a significant impact on the overall media industry,” he said in a Viber message.
For his part, Juan Paolo E. Colet, managing director at China Bank Capital Corp., said: “It reinforces the notion that if you are a media-oriented investor, it is best to bet on an established media business with a good track record of making money.”
“The exit of CNN Philippines will favor the major news media companies, especially GMA, TV5, and ABS-CBN. The shutdown shows just how tough it is to run a profitable broadcast media business in the Philippines,” he also said in a Viber message.
“Profitability prospects in the media industry are currently challenged by the rising adoption of digital channels and growing traction of content creation,” China Bank Securities Corp. Research Associate Stephen Gabriel Y. Oliveros said in an e-mail.
The broader reach of advertising in social media has also become a challenge for media giants like CNN Philippines, he said, noting that advertisers are using digital channels for ad placements.
“These factors could have reduced demand for the intermediary services of traditional media companies, which in turn, adversely affected one of their primary sources of income — advertising revenues,” he added. —