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ABS-CBN consumer business to overtake ad revs

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ABS-CBN Corporation is expecting its consumer sales to eventually exceed its advertising revenues in the next five to 10 years as it veers away from traditional income streams.ABS-CBN chairman Eugenio Lopez III said that while most of the company’s profits still come from ads, revenues from its consumer business like paid TV, films and merchandise now accounts for half of the media giant’s total earnings.To date, advertising revenues make up about 57% of the firm's total revenues.“We expect that although advertising will continue to grow in the next five to 10 years, it will only represent 25% of our total revenues,” he said in an annual stockholders’ meeting last Wednesday."We are moving away from reliance on advertising to consumer revenues. There is only so much growth you can get out of advertising. We want to monetize our content beyond just advertising by directly relating it to what consumers want and let them pay for it directly,” he adds.ABS-CBN began rapidly expanding its portfolio outside of its core media business last year. In June, the company entered a network sharing deal with Globe Telecom in a bid to enter the telco industry with ABS-CBNMobile. A month later, it earmarked P1 billion to build Kidzannia theme parks.Carlo Katigbak, head of ABS-CBN Convergence said that ABS-CBN Mobile attracted 300,000 subscribers in its first five months of operation. It now aims to hit 1 million subscribers by end-2014 and 2 million by 2015.Other notable milestones last year includes ABS-CBN’s movie arm, Star Cinema, which recorded a whopping P1.4 billion in domestic revenues from four movies. The company also entered a P200 million joint venture with Korean shopping giant CJ O Shopping Corporation to revive its home shopping business via O Shopping.Movies also proves to be lucrative this year, boosting the company’s profits in the first quarter up 7% to P538 million from P503 million year-on-year. ABS-CBN chief financial officer Aldrin Cerrado, said that three movies - "Girl, Boy, Bakla, Tomboy," "Bride for Rent," and "Starting Over Again"-- made more than P1 billion in ticket sales in the period. 

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