Viacom Gains Latin American Foothold with Telefe Acquisition

06.28.2017

Viacom's acquisition of Argentina's dominant free-to-air television network TelevisiÃ³n Federal (Telefe) marks a milestone for the company's strategic growth in the region.

One of Viacom International Media Networks' (VIMN, the international arm of Viacom) main goals is to promote international growth, particularly in the Americas. Telefe stands out as one of the largest high-quality content producers in Latin America, said Pierluigi Gazzolo, president of Viacom International Media Networks, Americas and executive vice president of Nickelodeon International.

"The purchase of Telefe was a direct response to this," says Gazzolo. "In addition, at Viacom we firmly believe in creating and owning content in order to be able to better take advantage of it."

The deal aligns with Viacom's global consolidation strategy, which is based on combining strong free-to-air TV networks with international pay-TV brands to provide scale and infrastructure.

"It's a model that has allowed the group to grow strongly in markets such as Europe, with Channel 5 in the United Kingdom-or India, with the Colours channel," explains Gazzolo. "Now we are extending this strategy to Latin America with the acquisition of Telefe. In addition, in Latin America free-to-air TV is still taking the largest share of investment and we expect this to continue."

VIMN, which owns such entertainment brands as MTV, Nickelodeon, Nick Jr., Comedy Central, Paramount Channel and VH1, among others, is itself a content engine, so the expansion is focused on using that content to gain ground in the region.

"We bought a high-quality content creator, not just a TV channel," says Gazzolo. "We want to further invest in content and production, while increasing global distribution of Telefe's extensive library."

The executive also says that at the industry level, both companies are already positioning themselves as a single company that offers the product portfolio of both, in terms of content and advertising sales.

"Telefe has done an incredible job of positioning itself as Argentina's leading network and we don't expect to change this strategy, but rather to work together to maximize opportunities," says Gazzolo. "We deeply value what they have and what they have done in the market and, to a large extent, that is why we have bought the company."

VIMN also announced in the first quarter of this year a new management team for Telefe that includes naming Guillermo Campanini chief operating officer and DarÃo Turovelzky director of global content for all of VIMN's channel portfolios in the region.

There's already been some programming synergy between the two companies, with Telefe launching a Nick Jr. block at the beginning of the year that's "so far, [been] very well received by the audience," says Gazzolo.

MTV Latin America's first joint programming initiative with Telefe was Despedida de Solteros (Bachelor party): MTV After Hours, in which the audience gets a behind-the-scenes look at the Telefe-produced reality show.

Likewise, Viacom already has used Telefe's studios to record original Comedy Central productions for the region, including La Culpa es de CortÃ©s (It is Cortes's Fault) for Mexico and A Culpa Ã© do Cabral (It is Cabral's Fault) for Brazil, in which five comedians use sarcasm and humor to comment on the news of the day.

The companies also are working closely on distribution, presenting a combined catalogue at television festivals and to clients.

To address the cultural differences in the region, certain channels target specific countries.

"This allows us to tailor content for each station to meet consumption differences in terms of programming grids and schedules, and also offer different content in each of them. At Viacom we have the advantage of having a broad content portfolio for different genres and audiences," Gazzolo says.

Several of the products, such as MTV's Shore franchise, work across regions. However, VIMN also makes local versions of some shows, such as MTV's Catfish Colombia, the Colombian adaptation of the show that reveals the truth behind online love affairs.

"The key is to create the appropriate mix for each market," says Gazzolo. In Argentina, local productions already are being generated for the company's different brands.

VIMN acquired Telefe as Nickelodeon celebrates 20 years in Latin America. Since it launched in the region, the network's growth strategy has changed considerably, especially as new consumption platforms extend viewership beyond linear television.

Currently, Nick features four channels, including Nick Jr. and NickToons, a fast-growing animation channel in the region. It also offers new products such as Nick Play, My Nick Jr., Nick First, Noggin, and nickjunior.com, a soon-to-be launched SVOD service for preschoolers. In addition, Nick has more than 40 digital games across all mobile platforms, drawing engagement as one of the region's highest-ranking children's channels on social media.

VIMN will celebrate Nick's anniversary across digital platforms, rolling out more than 640 hours of new content, which is the equivalent of more than 1,200 episodes.

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This includes new original production Vikki RPM, which will debut in the coming months and is produced by Viacom International Studios (VIS) in Miami. The series tells a Romeo and Juliet-inspired story set in the world of car racing.

Other upcoming productions include the telenovela Heidi, Bienvenida a Casa (Heidi, Welcome Home), developed in Argentina by Alianza Producciones and Mondo TV IberoamÃ©rica, as well as new series, animations and more editions of the Kids' Choice Awards franchise.

Several anniversary events are expected off air as well, from the Kids' Choice Awards, one of the media group's most popular events in the region (Argentina, Brazil, Colombia and Mexico) to the event El DÃa del Juego, in Argentina, Mexico and Brazil-a Latin American spin on the 13-year-old U.S. event Day of Play. Also, several activities and live shows are in development, including Paw Patrol, which will reach the region later this year.

Overall, Viacom's penetration in the region leverages strong content production and strategic acquisitions such as Telefe.

>"Particularly in the Americas," Gazzolo says, "we have the goal to continue gaining scale in the region."