Choice Cable TV Inc: growth plan

• Main Author: Laurena, Manuel Paolo J.
• Format: text
• Published: Animo Repository 2014
• Online Access: https://animorepository.dlsu.edu.ph/etd_masteral/4726
• Institution: De La Salle University

Technology has often been said to be the driving force in the development of cable and satellite television (Parson, P. et.al.,1998). Cable television or simply “CATV” is an important technology invented by man for the simple purpose was to deliver broadcast signals in areas where not received in an acceptable manner using an antenna. CATV has been around the US since the late 1940s and early 1950s. While in general, television has been the primary source of information, CATV has provided subscribers with wide array choices of programs. In the Philippines, 1987 marked the birth of CATV. Its entry allowed subscribers to watch their favorite local or foreign movies, news, educational, sports on a 24/7 airing time through radio frequency signals over coaxial cable or light impulses over fibre optics cables that are deployed in a limited area of operation. There are at least 500+ CATV companies in the Philippines that provide basic tier analogue delivery, while only a few offer broadband internet and pay per view services. Sky Cable accounts to 45% of the national CATV penetration. Sky Cable Corp. the country’s leading cable TV service provider, said only 15 percent of households with televisions in the Philippines had cable subscriptions. The rest of the country, the company said, settled with free TV channels. (Montecillo, P., 2012). The Philippine penetration rate shows that it is way below than the records from South Korea and Taiwan which boasts an 80% and 90% penetration rate in either Cable TV or Direct to Home (DTH) systems. Locally, at the Science City of Munoz, Nueva Ecija it has only 7% penetration rate of the 19,059 household. CATV penetration in the Philippines remains one of the lowest in Asia-Pacific as most Filipino households finds cable TV rates too high, as they cling to free-to-air broadcasts. The majority of Cable TV subscription rates remain low due to the high poverty rate even where there is critical mass in areas such as Metro Manila, Cebu, Davao City. Monthly Subscription Fee (MSF) vary from P250-300($5.65-6.40) most especially for provincial operations to P1000 ($22.60) in the upscale cities in the metropolis.(CASBAA, 2010). Similar to the national figures, Choice Cable TV maintained a P300 Monthly Subscription Fee (MSF) from 2001 to 2010 and since then it increased to P350 to cover its operations. Choice CATV (“Choice CATV” for the foregoing, (Appendix A: Securities and Exchange Commission Certificate) and (Appendix B: Mayor’s Permit) the company under study for this Growth Plan is a small CATV company located at the Science City of Munoz, Nueva Ecija, a 4th class city Nueva Ecija 150 plus kilometers north of Metro Manila. The study provides us with a classic business rivalry case, having a sole direct competitor which is Munoz Satellite TV, Inc. (“Munoz CATV” for the foregoing), a company that has started 10 years ahead of Choice CATV. In its 13 years of operation, Choice CATV was not able to fly as it was plagued with issues for both Macro Environment and Industry Environment. During its start-up, political-legal issues in the local level played a huge role as delays in issuance of business permit was a clear position of lost opportunity to serve our subscribers as well as opposition paper at the National Telecommunications Commission. Intensifying the situation was the decision of Domiciano R. Laurena, Jr. (Incorporator, President’s Eldest Brother, now President of Choice CATV) ran for City Mayor at the Science City of Munoz, Nueva Ecija in 2004. As a result of our candidacy, the President, Engr. Roval R. Laurena, ECE was kidnapped and brutally murdered in a far flung barangay within the city on March 17, 2004 a few months before the 2004 local election in the Philippines. Further, the untimely death of its President, Engr. Roval R. Laurena, E.C.E. in 2004 was a clear case of election violence as history account it as the first and only political related killing at the Science City of Munoz in a span of 100 years. In addition, continuous harassment on subscribers to switch providers, and outside plant equipment being sabotaged seen with bullet holes, and cut fibre and coaxial cables. Furthermore, economics also play a vital role as most of its subscribers are agri-entrepreneur which do not have a constant-stable income like employees. Since 2004, Choice CATV has conducted a couple of management changes to continue operation. Facing reality, the company needs to be resilient to be able to lead the business to the next level as it faces political-legal, economic, social and technology issues affecting the operation of the company. A common belief about resilience is that it stems from an optimistic nature. That’s true but only as long as such optimism doesn’t distort your sense of reality. (Harvard Business Review., 2009). Just like other companies, Choice CATV is experiencing hard times with issues and influences on economic, social and technological. However, unlike businesses in the metropolis, a family business is compelled to continue operation especially when the family name is on the line. As much as possible the business grows as an extension of the family’s tradition. In July 2013, the proponent was appointed as Chief Operating Officer of Choice CATV following a brief stint as a consultant in marketing in January of 2012. As Choice CATV still suffers and considers itself being a distressed company, the proponent’s entry to the company hopes to provide a ray of hope that the company can recover in the long run as it provides indicators of growth.