|
Dinero (translated)
Cisneros Group will invest over $250 million to launch content production facilities in the country. This all depends, of course, on whether or not the bid is won for the third TV channel.
The generation of content with productions made in Colombia is emerging as one of the most profitable businesses in the country for the coming years. It is no coincidence that the Cisneros Group of Venezuela is preparing to invest $250 million to begin the assembly of a major content production facility this year, which is estimated to generate about 3,000 jobs.
During a recent visit to the country, Steven Bandel, President of the organization, stated: "The future is in content production. The awarding of a third channel for Colombia, together with revenue from digital television will lead to an increased demand for all types of productions to meet the entertainment needs of the public."
Cisneros, in possible partnership with Televideo, is one of the three participants in the bidding for the third private television channel in Colombia. Although Bandel recognizes that there is a strong expectation to win the bid, because the channel is an important piece of the project, he already has a plan B ready in case they do not win the bid. "We thought about the possibility of an alliance with a local or regional channel. The obstacles are being overcome, it is important to pursue the project and we already have land available on the outskirts of Bogota. We aim to make Colombia the Hollywood of Spanish-language content, “he says.
What lies behind
The appetite for the content production business started to become evident two years ago. In June 2007, Fox acquired a majority stake in Telecolombia, which produces content for RCN television and for the United States. Today, Fox Telecolombia represents 60% of the estimated production that this company will invest in the region and has made investments in our country of nearly $7 million.
Teleset, in turn, had a 50% share acquired earlier this year by Sony Pictures and plans heavy investment in studios and technical infrastructure to strengthen its presence in the production business.
And according to Steven Bandel, research done by the Cisneros Group indicates that the Spanish-language content production market increases $1,000 million per year and the demand will become even greater if one considers that there is already interest in better productions in countries all over the world and in all languages. "We are currently translating a telenovela from Spanish to introduce it into the Chinese market. We also have plans to export productions to 104 countries internationally, in over 20 languages, Spanish being one of the most relevant," says Bandel.
Mexico and Venezuela are, according to the experts, the most advanced countries in content development, yet production costs are considered high compared to what can be achieved in Colombia, where they also highlight the talent of available professionals.
The industry estimates indicate that Colombia exports about $25 million per year in production. But with growth in demand and the development of new channels, the figure could be higher, hence the growing interest in bidding for this segment.
According to the National Television Commission (CNTV), the sales of content to international markets have come to represent between 4% and 19% of operating income in the last ten years, for the RCN and Caracol channels. There are no exact estimates on how the outcome will be settled but a producer interviewed by CNTV noted that up to 30% of the expected earnings from international sales can go to the producer of content and the remaining 70% stays with the channel that serves as a marketer.
And although the television content business is the most attractive, Cisneros intends on going beyond. “We want to be in all of the entertainment businesses and generate content for internet, cellular phones and all types of public access channels,” affirms Bandel, who does not rule out the possibility that the affiliate in Colombia could also be devoted to organizing concerts and developing musical content for different formats, a business that in Colombia until now has been developed in a segmented way.
The goal
The Colombian Television Poll, which took place in February of last year by Ipsos-Napoleón Franco for CNTV, confirmed in October 2008 that the public believes that there are enough telenovelas, reality-shows and dramas, while there is a lack of documentaries, comedy and musical programs. This means that if Cisneros intends to generate different offerings, it could make the difference and gain an important share of the market, both in the local and export markets.
Bandel understands this. “With the third channel, there is an interesting opportunity for counterprogramming. That is, broadcasting programming totally different from Caracol and RCN. These days the challenged genres include telenovelas, reality-shows and news programs. We propose to broadcast on the third channel or our affiliate channel, whatever the case may be, programming that is totally attractive and different that also encourages other advertising guidelines.
The opportunities are clear; there is talent, the infrastructure is being strengthened and the investment of capital promises strong competition in the upcoming years. But only those that are capable of really creating innovative content will have the opportunity to grow and stand out in this business.