Now Corp. has started negotiations to acquire equity ownership of News and Entertainment Network Corp. (Newsnet), an interactive pay television and multimedia services firm.
In a press briefing, Mel Velarde, Now Group chairman, said Now Corp. is looking at acquiring substantial ownership of Newsnet, from a minimum of 20 percent up to 100 percent, to allow the company to upgrade its services from fiber air network to 5G services using the 26 gigahertz frequency.
Velarde has yet to disclose the amount of the transaction which could be through direct cash investment, share swap and preferred shares convertible to equity.
He said the transaction will conclude before the end of the year.
Newsnet has a certificate of authority from the National Telecommunications Commission to install, operate and maintain in the 25.35 Ghz to 26.35 Ghz spectrum band local multi-point distribution system to deliver interactive pay TV and multimedia services in Metro Manila and parts of Luzon, North Luzon, Visayas and Mindanao.
Recent Court of Appeals decisions resolved the right of Newsnet over the said 5G frequencies and upheld Newsnet’s authority to operate interactive pay TV and multimedia services nationwide.
This move to acquire Newsnet will upgrade Now Corp.’s existing fiber air network to 5G-26 Ghz to deliver interactive pay TV and multimedia services, laying the foundation for the intensive synergy with its affiliate Now Telecom.
“The potential acquisition of Now Corp. of Newsnet achieves two objectives. First, the increase of capacity from 2.4 Gbps (Gigabits per second) per existing base station to 9 Gbps, an almost 500 percent increase. This gigabit capacity shall be enjoyed by residential, enterprise and vertical markets,” Francis Xavier Manglapus, Now Corp. vice chairman, said.
“Second is the increase of area coverage over Metro Manila, currently in 50 market areas and expanding in some parts of South Luzon, North Luzon, Visayas and Mindanao,” he added.
Now Corp., Now Telecom and Newsnet with Now Cable Inc. signed a memorandum of agreement for the P1.2-billion common digital infrastructure project that will further expand its coverage area within Metro Manila and Calabarzon.
The investment in the digital infrastructure project is included in Now Corp.’s P7.8-billion capital expenditure in the next 10 years which aims to expand its coverage and services nationwide.
The digital infrastructure will increase its current 50 market areas up to a total of 150 areas in Mega Manila and expand further on a nationwide basis through collaboration, joint venture, build-operate-transfer projects and public-private partnership with local community organizations such as local government units, electric cooperatives, cable TV operators, internet service providers, among others.
Rene Rosales, Newsnet chairman, said the demand for larger capacity and higher speeds with better latency is expected to increase over time.
“At a technological point of view, the upgrade of our network is expected to unleash the full potential of 5G — higher capacity, faster downloads and uploads, low latency. With more and more collaborative software being used by companies and workers adopting hybrid set-up, our network will be geared towards addressing those needs,” he said.
Newsnet is 100 percent owned by Velarde Inc. while the latter has 19 percent stake in Now Corp.
