THE OLIGOPOLY IN BUSINESS

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ROGATIONIST SEMINARY COLLEGE
COLLEGE OF PHILOSOPHY
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I. INTRODUCTION
II. BODY

A. ABS-CBN vs. GMA7

1. Background of the company
2. Current owner
3. Existing competition
4. Market and economic status of the company

B. Jollibee vs. McDonalds

1. Background of the company
2. Current owner
3. Existing competition
4. Market and economic status of the company

C. Pizza hut vs. Shakeys

1. Background of the company
2. Current owner
3. Existing competition
4. Market and economic status of the company

III. CONCLUSION
I. INTRODUCTION

Competition is happening everywhere. Common experience will tell that in many

ways and in many respect, competition is happening between persons, nations, and most

especially in business. One classic definition of competition is “a situation in which someone

is trying to win something or be more successful than someone else”.1 One temptation that

usually come into the person’s life is the desire to become above and is superior over the

other. Because of this, he would try to pull down those whom he thinks is superior and is

above him. Everywhere, this competition is happening. At school, there is a great competition

that is happening between students and even among the professors and teachers. But in the

larger sense, competition usually happens in business.

In today’s society there is a great competition in the corporate world. with the

advancement of science and the increase of people’s needs and even wants, the business

sectors are competing who will and can provide the best products and services to its

consumers. While the consumers’ needs and wants do not end, business also continuously

exist and provide the peoples’ needs, wants and desires. Because of the great demand of

products and services from the consumers and to meet its demands, there are now many

companies and stations established in order to cater the people’s needs and wants. To give

some basic example, there is a great competition between the largest TV Networks in the

country, i.e., the ABS-CBN and the GMA 7. Also, the competition between the giant fast

food chain the world i.e., Jollibee and McDonalds. In addition, there is another competition

among one of the biggest pizza houses, i.e., the Pizza hut and Shakeys. These companies are

competing who could provide the best products and services to its consumers, but most of all,

for practical reason, they are competing who could gain more profit from the consumers.

1 Cambridge Dictionary
II. BODY

A. ABS-CBN vs. GMA 7

In the Philippines, there are two major television networks who are competing. This

competition is not only to give entertainment to millions of viewers whom they serve daily but

also to the advertisers whom they get their profit that supports and sustains their industry or

business. These two biggest networks are the Alto Broadcasting System – Chronicle

Broadcasting Network or commonly known as the ABS-CBN or the Channel 2 and also the

Global Media Arts or commonly known as the GMA 7. These two television networks are the

biggest and the largest networks in Philippine television.

Alto Broadcasting System – Chronicle Broadcasting Network, loved by

many as ABS-CBN, is the largest multimedia network in the country. From
its humble beginnings to its undeniable successes, the Company has over 60
years of stories to tell…In the face of changing governments, despite natural
disasters, and amidst rapidly evolving technologies, ABS-CBN remains
steadfast in its commitment to serve the Filipino. The organization is
continuously evolving to provide better service through radio, free TV,
digital terrestrial TV, cable TV, film, movie, music, publishing, online,
events, licensed products, cash remittance, and various advocacies.2

ABS-CBN Corporation is the Philippines’ leading information and entertainment

multimedia conglomerate. The Company is primarily involved in television and radio

broadcasting, as well as in the production of television and radio programming for domestic

and international audiences and other related businesses. ABS-CBN produces a wide variety

of engaging, world-class entertainment programs that are aired on free-to-air television. The

Company is also one of the leading radio broadcasters, operating eighteen radio stations

throughout the key cities of the Philippines. ABS-CBN provides news and entertainment

programming for nine channels on cable TV and operates the country’s largest cable TV

service provider. The Company also owns the leading-cinema and music production and

2 http://corporate.abs-cbn.com/our-story. Retrieved July 30, 2016.

distribution outfits in the country. It brings its content to worldwide audiences via cable,

satellite, online and mobile. The Company has interests in content development and

production, cable and satellite television services, merchandising and licensing, mobile and

online multimedia services, glossy magazine publishing, video and audio post production, and

overseas services, all of which complement and enhance ABS-CBN’s strength in content

production and distribution.3

The founders of the ABS-CBN are Fernando Lopez, James Lindenberg and Eugenio

Lopez. They founded it on June 13, 1946. To this very day, Charo Santos-Concio stands as the

company’s Chief Executive Officer.

ABS-CBN’s existing competitor is the GMA 7, one of the biggest television networks

in the country. Despite its close competition, ABS-CBN had ₱2.545 billion as its net income

in 2015 with ₱38.28 billion total revenue in the same year.

GMA NETWORK, INC. is the leading broadcasting company in the Philippines. It

operates a network of 47 Very High Frequency (VHF), 33 Ultra High Frequency (UHF)

television stations and 24 radio stations throughout the country. The Network was founded by

Robert La Rue Stewart in 1950 as Republic Broadcasting System (RBS) with flagship AM

radio station DZBB operating from the Calvo Building in Escolta, Manila. RBS ventured into

television in 1961 and began broadcasting on Channel 7 in the Greater Manila Area. In 1975,

the triumvirate of Felipe L. Gozon, Menardo R. Jimenez and Gilberto M. Duavit took over

from the Stewarts the management of RBS and renamed it to GMA 7. The original meaning

of the acronym "GMA" was Greater Manila Area, referring to the initial coverage area of the

station. As GMA's reach widened, the meaning of its acronym was changed to Global Media

Arts. Today, its corporate name is simply, GMA Network, Inc. GMA also owns a wide array

of media-related businesses apart from its television and radio networks including film

3 https://www.linkedin.com/company/abs-cbn. Retrieved August 6, 2016.

production, record publishing and distribution, program acquisition and syndication,

international channel operation, production design, talent development and management,

marketing and promotions, audio-visual production and new media. GMA is the most awarded

television network in the country. By far, it is the only Philippine media company to have won

the coveted Peabody Awards for excellence in journalism (2000 and 2010), and the Best

Terrestrial Television Station of the Year (2005) from the Asian Television Awards. GMA

reaches out to millions of Filipinos across the globe through its international channels GMA

Pinoy TV, GMA Life TV and GMA News TV International. These channels are available via

cable, direct-to-home and IPTV. GMA listed in the Philippine Stock Exchange in 2007 with

the ticker symbol GMA7 (Common Shares) and GMAP (PDRs). GMA's official tagline is

"Kapuso ng Bawat Pilipino (One in Heart with Every Filipino)."4

The current owner of GMA 7 is GMA Holdings, Inc. (25.17%), Group Management

and Development, Inc. (23.47%), FLG Management and Development Corporation (20.01%),

M.A. Jimenez Enterprises (13.49%), Television International Corporation (9.94%). As to this

very day, Atty. Felipie Gozon stands as the Chief Executive Officer of the said network.

GMA 7’s main competitor is ABS-CBN. In 2015, GMA 7 had ₱4.641 billion operating

income and ₱2.126 Billion net income in the same year. They have ₱14.416 billion total assets

in 2015 with the total equity of ₱9.039 billion.5

4 https://www.gmanetwork.com/corporate. Retrieved August 6, 2016.

5 Ibid.