Politics, Economy and Society in 2013

LATIN AMERICA: POLITICS, ECONOMY AND SOCIETY IN 2013

BARCELONA BEIJING BOGOTA BUENOS AIRES LIMA LISBON MADRID MEXICO PANAMA QUITO RIO DE JANEIRO SÃO PAULO SANTO DOMINGO CONTENTS

Prologue 3 Political and electoral panorama in Latin America (2013-2016) The Latin America of the three “Cs”: Continuism, Centrism and middle Classes 5 Audiovisual Overview of Latin America Concentration and technological renewal 16 The protests are here to stay: Social change and mobilisation of citizens in Latin America 35 Overview of Latin American press The pre-Internet boom 51 The Latin American radio panorama The future of radio in Latin America: a new revival 67 LLORENTE & CUENCA 79 Prologue

Latin America is currently going through a good period accompanied by the development and consolidation of the new emerging middle classes. These are demanding that their governments provide the guarantees and means to effectively exercise their rights and they want their share of the gains from economic progress.

Although it is common to talk about Latin America as if it were a homogeneous region in terms of its political, economic and social situation, the reality is that this region is anything but homogeneous. The different economic and social situations, the distinct political junctures and the diverse operating environments for companies and financial institutions are, among others, factors that lead to the diversity that characterises Latin American countries.

That is why we need to look more closely at Latin America, exami- ning each of the features that make these countries unique.

In all of this, we need to take into account the creation of new blocks that, like the Pacific Alliance, have an impact on the current situation and influence future expectations in terms of the political and economic development of the region, as well as shaping the strategic international situation.

The next few years will be decisive for the future of the region, firstly given the “electoral rally” that will take place between now and 2016, which will determine the new political panorama of the region. Given current trends, it seems that the political situation in Latin America over the next three years will be marked by con- tinuity, centrism and the growing importance of the middle class.

In addition, we are also seeing in Latin America a revolution in the emergence and use of the Information and Communication Techno- logies (ICTs) and this is proving to be a catalyst for communication becoming a key factor in the cultural development and economic growth of the nations.

So, and in contrast to the crisis in the press in Europe and the Uni- ted Sates, Latin America is currently experiencing a boom in the readership of the written press. Similarly, the audiovisual sector in Latin America has not remained on the margin of these transformations and it has followed the trends being seen globally. Phenomena such as technological development, the increase in the emerging classes and their purchasing power and the fragmentation of the markets are what characterise the audiovisual media sector in the region today.

The same is true for radio. Thanks to the growth of the new technologies, the radio sector in Latin America is experiencing a rejuvenation which is also leading to the appearance of new radio stations, such as those broadcasting over the Internet. Once again, the fragmented nature of the audience is leading to new strategies for broadcasting content.

All of these processes are taking place in an environment dominated by the development of the emerging classes, who have become the dri- ving force behind social change on the continent and who, in some cases, are making their voices heard in protest against the lack of public services and infrastructures which, in their view, should be provided by the state. To date the governments have proved themselves incapable of channelling these collective demands and responding to them.

In short, Latin America is currently experiencing a period of change and the only way to understand this reality is to look at the region from a multidisciplinary perspective.

This summary includes some of the decisive political, economic and social issues affecting Latin America in 2013. We must be aware of these, and the differences between the countries, if we hope to gain a thorough understanding of this region.

José Antonio Llorente Founding Partner and Chairman Political and electoral panorama in Latin America (2013-2016) The Latin America of the three “Cs”: Continuism, Centrism and middle Classes

Madrid, june 2013 POLITICAL AND ELECTORAL PANORAMA IN LATIN AMERICA (2013-2016) THE LATIN AMERICA OF THE THREE “CS”: CONTINUISM, CENTRISM AND MIDDLE CLASSES

1. INTRODUCTION 1. INTRODUCTION 2. DEVELOPMENT 3. RE-ELECTIONIST TRENDS IN THE Between 2013 and 2016 most of the countries in Latin America will REGION (2013-16) renew their executive and legislature. This electoral “rally” will be a 4. CONCLUSIONS good time to assess the political dynamics of the region, analysing in particular two phenomena:

• Discover the predominant political tendency in the region, after the “sway to the left” between 2002 and 2008 and the revival of the centre right candidates between 2009 and 2012.

• And study re-electionism as a regional phenomenon that reveals a growing hyper-presidentialism in most Latin America countries.

The elections in Ecuador in February 2013 and in Paraguay and Venezuela in April marked the beginning of a new Latin American election cycle that will end in 2016, by which time 17 of the 18 countries will have held their presidential elections (Mexico is the only country with elections after that year, in 2018).

It is a decisive four-year period, therefore, during which we will find out how strong the “XXI century socialism” is without Hugo Chávez, observe the progress of the reformist left in South America and check the strength of the centre right options in Mexico, Central America, Colombia and Chile.

Ww uphold in this report that politics in Latin America is currently marked by three “Cs”: the predominance of centrist political outlooks (centre left and centre right) combined with the stagnation of more radical positions; the continuism of governments in power thanks to the excellent economic situation and constant growth since 2003 – except only in 2009-; and the emergence of new, heterogeneous middle classes in the region with greater purchasing power (and borrowing capacity), which also explains the continuist tendency and centrist positions.

ELECTION CALENDAR 2013-16 2013 Presidential elections in Ecuador, Paraguay and Venezuela (already held in these three countries) and in Honduras and Chile 2014 Presidential elections in Brazil, Colombia, Bolivia, Uruguay, El Salvador, Panama and Costa Rica 2015 Presidential elections in Argentina, Guatemala and Nicaragua 2016 Presidential elections in Peru and the Dominican Republic

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2. DEVELOPMENT Kirchner in Argentina (2003), Tabaré Vázquez in Uruguay To explain that shift towards the (2005), Evo Morales in Bolivia centre in the region, we must first (2005), Michelle Bachelet in analyse (I) the different tendencies Chile (2006), Rafael Correa in and (II) the political dynamics Ecuador (2006), Daniel Ortega in present in Latin America. Nicaragua (2006), Álvaro Colom in Guatemala (2007), Cristina Then, in the third part of this Kirchner in Argentina in 2007, “There are three analysis, we will study the “re- Fernando Lugo in Paraguay political and electoral election fever” in Latin America. (2008) and Mauricio Funes in El Salvador (2009). tendencies in Latin I The three major political America. At different tendencies in Latin America However, Latin America did not times some hold more experience a shift to the left Through the elections due to be before, nor is it experiencing weight than others, held in the coming four years a shift to the right now. The but all three are we will be able to see which of situation is much more complex always present” the three major tendencies in and varied, just as the region is. the region currently holds the greatest weight. The prevailing There are three political and idea up to now has been that election tendencies in Latin Latin America shifted either to America. At different times some the left (2002-2008) or to the hold more weight than others, but right (2009-2012). At present, all three are always present: however, the political bias is actually more complex and much • The consolidation of populist more heterogeneous. nationalism

The victory of Sebastián Piñera “XXI-century socialism”, in the second round of the 2010 also known as “Chavism” or presidential elections in Chile “Bolivarianism”, is actually appeared to confirm Álvaro Vargas authoritarian, statist, Llosa’s theory of a shift to the populist nationalism. Chávez right in Latin America (with the started that tendency off in victories of Ricardo Martinelli in 1998 and after upholding it Panama, Porfirio Lobo in Honduras alone until 2005 (supported and Piñera in Chile). exclusively by Fidel Castro en Cuba) he was then backed This was a turnaround from the by new allies such as Evo previous tendency, prevailing Morales, Rafael Correa and since the middle of the last Daniel Ortega. decade, when people talked of the “sway to the left” 2009 consolidated the in the region following the populist-nationalism leaders victories of Hugo Chávez in in power: Hugo Chávez won Venezuela (1998), Lula da Silva the February referendum in Brazil (2002/2006), Néstor allowing him to opt for re-

7 POLITICAL AND ELECTORAL PANORAMA IN LATIN AMERICA (2013-2016) THE LATIN AMERICA OF THE THREE “CS”: CONTINUISM, CENTRISM AND MIDDLE CLASSES

election indefinitely; Rafael of a “sway to the left”, Correa was re-elected in the as was the case a decade April 2009 elections; and Evo ago, over-simplified the Morales won the Presidential situation, lumping together elections in Bolivia in very different politics such December of that year. as those of Bachelet or Lula/Rousseff (who respect The re-election of Correa in political and economic 2013 and Chavez’s party in freedom) with those of 2012/2013 merely confirmed Chávez/Maduro, Evo Morales that consolidation, although and Correa. no new players have joined “2012 was marked by this front. Along with the centre right continuism and and populist nationalism the predominating • The advancing of the tendency there was, and centre right still is, a strong reformist victories of the left tradition in the region, centrist candidates” Had there been a shift to the represented by Lula da Silva, left between 2002 and 2009, Michelle Bachelet or José it would have been difficult Mujica and Tabaré Vázquez. to explain the government of Mexico by the centre-right II Regional political dynamics party PAN since 2000 or the Uribe government since 2002 Along with the three major in Colombia (led by Uribe tendencies described above, we himself from 2002 to 2010 and should stress that in recent years then by his successor-cum- (2010-2013) certain dynamics rival, Juan Manuel Santos). have been perceived to be very strong in the region, in addition to These two figures were the heterogeneity of political bias: joined by Sebastián Piñera the continuism of certain parties in Chile, Porfirio Lobo in or leaderships in power and the Honduras, Ricardo Martinelli predominance of centrist forces in Panama and Otto Pérez (both centre right and centre left). Molina in Guatemala. And in 2012 the PRI, led by Enrique • Continuism Peña Nieto, even got back into power. 2012 was marked by continuism and the • The strength of the predominance of victories moderate, reformist left by the centrist candidates (centre right and centre left). Apart from the significant exceptions to that This continuism, ratifying and hypothetical “sway to the supporting the political and left” (such as Mexico and economic management of the Colombia), talking generally current governments, has been

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favoured by the economic election of Rafael Correa in panorama in the region, also February 2013). marked by continuism in economic prosperity, although In a way, the victory of the with a few black clouds in the PRI in Medico and the Partido background: the possibility Colorado in Paraguay can also that the crisis in the European be considered continuism. Union might eventually spread The PRI, a centre right party, to the rest of the world, took over from the PAN in the causing a slowdown in China centre right power; and the “The governments linked and aborting the feeble upturn Paraguayan Partido Colorado to “XXI century socialism” in the United States. got back into power after holding it continuously from have consolidated their This prosperity has in turn 1954 to 2008. power but have not enabled the governments managed to spread to start up welfare • Centrism programmes (conditioned their influence” direct transfers), through Centrist forces have been which large sectors of the predominant in Latin America population have pulled in the past five years. out of poverty forming an incipient middle class. This can be deduced from the All this has increased the fact that the governments population’s support for the linked to “XXI century current ruling parties. socialism” have consolidated their power but have not There has been continuism, managed to spread their for example, in the influence. Nobody has joined Dominican Republic with the the Bolivarian block since triumph of the ruling party, 2008. This political bias has of “Leonelism” without even lost some followers, Leonel Fernández, through such as Manuel Zelaya in Danilo Medina: his PLD party Honduras (2009), who had has been in power since 2004 formerly been an ally of and will remain in power at “Chavism”, or a close figure least until 2016 with Leonel such as Fernando Lugo in Fernández’s wife, Margarita Paraguay (2012). Cedeño, now as vice- president, making the lines If 2010 was the year of of continuism even firmer. the so-called “turn to the centre” (with the victories That continuism also existed of Sebastián Piñera in Chile in Venezuela (triumph of and Juan Manuel Santos in Hugo Chávez in October 2012, Colombia), 2011 was the subsequently ratified in 2013 year that best expressed the with the victory of Nicolás ideological heterogeneity Maduro) and in Ecuador (re- of Latin America, with the

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victories of a centre right 1995 Constitution contemplated candidate in Guatemala successive re-election for two (Otto Pérez Molina) and two terms in succession, which had centre left candidates: in not been contemplated in the Peru (Ollanta Humala) and in previous constitutions (the 1979 Argentina (Cristina Kirchner). Constitution in Peru and the 1853 Constitution in Argentina, which In 2012 that predominance of allowed re-election but after the centre was confirmed with alternate terms). the victory of the PLD in the “The incumbents aspire to Dominican Republic (a centre These two countries began left party that has shifted a tendency which spread remain in power for one or towards a more pragmatic throughout the region: other several more terms or orthodox position) and, countries jumped on the and more often than not especially, the PRI led by bandwagon: Brazil in 1997 and Enrique Peña Nieto in Mexico. Venezuela (the 1999 Constitution they are re-elected” authorised a single re-election, III The re-electionist wave in but its subsequent amendment Latin America approved in 2009 allowed indefinite re-election) and in the The re-elections of Cristina following decade, the Dominican Fernández de Kirchner in October Republic (2002), Colombia 2011, Hugo Chávez in October (2005), Ecuador (2008), Bolivia 2012 and Rafael Correa in February (2009) and Nicaragua (2010). 2013 merely reinforced a general tendency within the region: the In other countries, such as incumbents aspire to remain in Panama or Costa Rica, re-election power for one or several more is more complicated. In the latter terms and they mostly come out country, the possibility of re- victorious and are re-elected with election for alternate terms was overwhelming triumphs, often approved in 2003; before that any in the first round, in which they kind of re-election was barred. obtain more than 50% of the votes. Oscar Arias began this trend, being president between 1986 In the eighties, when democracy and 1990 and again between 2006 returned to most of the region, and 2010. In Chile, Uruguay and El excluding Cuba, the president Salvador the incumbent president could not be re-elected twice in cannot stand for re-election succession in any Latin American immediately; they must let a country except Nicaragua, the presidential term go by before Dominican Republic and Paraguay. they run for president again. This tendency changed in the nineties, when the re-electionist In Panama, the explanation of tendency began to triumph in most why immediate re-election is Latin American countries. Carlos complicated takes us back to Menem’s Argentina following the when Ernesto Pérez Balladares constitutional reform of 1994 got into power on 1 September and Alberto Fujimori’s Peru in its 1994, when the Torrijos-led

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nationalism returned to power • Four countries prohibit re- democratically. Following in the election in all cases (Mexico, wake of his Peruvian, Argentinian Guatemala, Honduras and and Brazilian counterparts, Paraguay). Pérez tried to push a number of constitutional reforms through The possibility of successive re- Parliament to allow presidential election is a trend that almost re-election for a further five always favours the ruling parties years. This ambition of Pérez’s and presidents in power. Since the ruling party was backed by three transitions to democracy began small liberal centre right parties: in the Dominican Republic and “Only in one country, Liberal Nacional, Solidaridad and Ecuador (1978), all presidents who Venezuela, is indefinite Cambio Democrático. The rules have sought successive re-election re-election permitted” argued that he needed another have won the elections, except year to complete the economic two: in Nicaragua in 1990 and the reforms and direct the smooth Dominican Republic in 2004. handover of the Panama Canal, due to be made as of 31 December 1999, a priority issue for the 3. RE-ELECTIONIST TRENDS national economy. Unsuccessful IN THE REGION (2013-16) in his attempt to change the re- election rules, Pérez led his party A new election rally (2013-2016) is to defeat in the presidential now beginning in Latin America, in elections of 2 May 1999, in which which a wave of candidates for re- its candidate, Martín Torrijos election is expected. Espino, was beaten by Mireya Moscoso, who took office on 1 Between 2013 and 2016, all four September. tendencies described above in respect of Latin American re- At present, the situation regarding re- electionism will be observed: election is, therefore, very diverse: • There will be incumbent • Only in one country presidents who aspire to (Venezuela) is indefinite re- re-election (as was the case election permitted. of Rafael Correa and will be that of Evo Morales in Bolivia, • In six countries (Argentina, elected in 2005 and re-elected Bolivia, Brazil, Colombia, in 2009, constitutional reform Nicaragua and Ecuador) included). consecutive re-election is permitted, but not indefinitely. It also looks very much as if Dilma Rousseff will seek re- • In another seven countries it election in 2014, since her is only possible after at least popularity and management one or two presidential terms make her a natural candidate (Chile, Costa Rica, El Salvador, for the PT. Juan Manuel Panamá, Peru, Dominican Santos will most likely be the Republic and Uruguay). candidate for the ruling party

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in 2014, first elected in 2010 as into power in 2005, or Alan successor of Uribe’s policies. García (president in 1985-90 Now, after distancing himself and 2006-2011) and Alejandro from the former president Toledo (2001-2005) in Peru. Álvaro Uribe, he would seek re-election, in which he is Moreover, rumour has it that very likely to run against Tony Saca, president of El Uribe followers. Salvador between 2004 and 2009, will be the candidate for The case of Cristina Kirchner Movimiento Unidad, running in Argentina is different. The against the larger forces in “Several former presidents Constitution does not permit the country, ARENA (his former hope to return to power further re-election after party) and the FMLN. in countries in which being elected president in 2007 and repeating in • Presidents’ wives aspiring successive terms in office 2011. She has not said she to succeed their husbands are not permitted” wants to be re-elected, but (a sort of marital re- her closest circles and the electionism: cases of Kirchnerite organisations (La Xiomara Castro in Honduras, Cámpora) working with her Sandra Torres in Guatemala are clearly banking on this. and people are speculating The key is in the legislative with that of Nadine Heredia elections of October 2013: in Peru). getting enough votes in Congress just with the Néstor Kirchner started this Peronists will be practically trend back in 2007 when his impossible. But with an wife, the political leader overwhelming victory in the Cristina Fernández, was elections, it would be easier elected. Two presidents’ to reform the Constitution, wives are currently aspiring to taking advantage of the continue their husbands’ work. fact that the opposition is In Peru, Ollanta Humala’s wife divided, fragmented and has Nadine Heredia is a strong no clear leader. candidate, although to enable her to run for president the • Several former presidents election rules would have hope to return to power to be changed, or a new in countries in which interpretation made based on successive terms in office the Constitution, which would are not permitted. permit it and would rank above election rules. This will be the case if Michelle Bachelet in Chile, In Central America, following who was in office between Sandra Torres’ defeat in 2006 and 2010, Tabaré Guatemala when running Vázquez in Uruguay, who led for president in 2011 (she the left-wing Frente Amplio even divorced her husband,

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President Álvaro Colom, to Electors are pragmatic in get round the Constitutional their behaviour, avoiding impediments), Xiomara radical options and supporting Castro, wife of Manuel continuism that will guarantee Zelaya, president of Honduras economic stability and progress. between 2006 and 2009, is the This electoral behaviour giving left-wing candidate for the preference to the centrist 2013 elections. options has been favoured by prevailing economic prosperity And Sandra Torres, with no in Latin America and growth of constitutional obstacles this the middle class. “If the regional economic time (her former husband situation is maintained left the presidency in Even where the “XXI century and the world situation, 2011), has been proclaimed socialism” tendencies are presidential candidate imposed, this is because so closely linked to by her party, the Unidad those regimes have strong the region, does not get Nacional de la Esperanza, charismatic leaders (Rafael any worse, the middle whose political council Correa or Evo Morales), who is headed by the former promote orthodox economic class will presumably president (and ex-husband) policies which, thanks to continue growing” Álvaro Colom. the increased income from exports, enable them to • Countries in which no re- employ policies resorting election of any nature is to clientelism [patronage]. permitted (the recent cases However, it should be noted of Mexico and Paraguay that raw material exports are and forthcoming elections maintained because these in Honduras in 2013 and countries have not managed to Guatemala in 2015). progress significantly towards industrialisation of the basic consumables they produce. 4. CONCLUSIONS If the regional economic The following conclusions can be situation is maintained reached from this overview of the and the world situation, election panorama in Latin America so closely linked to the for the coming four years: region, does not get any worse, the middle class • Since 2009 the vast will presumably continue majority of the Latin growing, which will boost American electorate has the centre right and moved towards moderate, centre left tendencies and centrist political positions. strengthen the centrist, And if there are no drastic continuist dynamics of changes in the economy, this preferring the options that tendency is likely to continue have governed so far, since over the forthcoming period. with those governments the

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countries have achieved charismatic leader by popular economic stability and vote, weakens institutionalism, social development. boosts personalist politics, wipes out the division of • Together with centrist, powers and hampers control moderate inclinations, over the executive’s actions. continuism has become one of the principal characteristics Sometimes (as in the cases in the region. of Venezuela, Ecuador or Bolivia) that hyper- The re-electionist fever presidentialism leads to what merely confirms that the is known as “competitive political systems in most Latin authoritarianism”, explained as American countries have follows by the political scientist similar problems which favour Steven Levitsky: the re-election tendency as a solution against the little “If Venezuela is neither a credibility of the parties dictatorship nor a democracy, among the public opinion what is it? It is competitive and electorates, a constant authoritarianism, like weakening of the institutions, Fujimori’s Peru. Unlike the a natural leaning towards military or single-party clientelism [patronage] and dictatorships, competitive excessive personalism. In fact, authoritarianism is a one of the “victories” that hybrid regime. There are must be recognised in these democratic institutions that leaders who have emerged are not mere fronts. There in Latin America is that they are independent media and have managed to delegitimise opposition parties, and the the traditional politicians and opposition competes seriously parties, such that there is now for power (sometimes little or no opposition in those it wins, as occurred in countries to the ruling powers. Nicaragua in 1990), although the playing field is uneven. The collapse of the party The opposition has fewer systems in many countries and resources, less access to the weakness of the judicial and the media, its leaders and legislative powers has led to a activists suffer various types concentration of constitutional of harassment and find that and meta-constitutional instead of being neutral powers in the figure of the arbitrators, the State president, which is known institutions (the judiciary, as “hyper-presidentialism”. electoral bodies, Sunat) are Hyper-presidentialism, which used as weapons against goes hand in hand with them. Jorge Castañeda successive re-electionism described the 1994 elections as a way of legitimising the in Mexico -another case of

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competitive authoritarian- not be protected unless there are ism- as a “football match strong, transparent democratic in which the goalposts were institutions (a constitutional different sizes and one framework and organisations team has 11 players plus the arising as a consequence of that referee and the other team framework) operating between has six or seven players.” election periods. The second team could win, but it is very difficult.” Finally, democracies with weak institutions are more vulnerable Phenomena such as “competitive to corruption and more inclined authoritarianism”, re-electionism to back a political party that and hyper-presidentialism wear is in power for a long period. down the democratic institutions. Moreover, democracies with Most countries in the region are weak institutionalisation may full or incomplete democracies, gradually lose ground and end having free elections with civil up as authoritarian regimes. The freedoms, both conditions presence of solid institutions, being necessary for democracy, which account for their but that is not enough to actions, forestall or hamper consolidate a full democracy authoritarian tendencies. unless they are accompanied by a transparent government, Therefore, the short-term political partici-pation and challenge facing Latin America strong, credible institutions. countries is to strengthen their political institutions in order to Elections are an essential part of preserve democracy in the region democracy. But minority rights and and avoid the risks of re-electionism freedoms and human rights will and hyper-presidentialism.

15 The protests are here to stay: Social change and mobilisation of citizens in Latin America

Madrid, october 2013 THE PROTESTS ARE HERE TO STAY SOCIAL CHANGE AND MOBILISATION OF CITIZENS IN LATIN AMERICA

1. INTRODUCTION 1. INTRODUCTION 2. COMMON FEATURES OF THE PROTEST MOVEMENTS Chile hit the world headlines in 2006 and 2011 with student protests 3. CONCLUSIONS that put in a tight spot both centre-left governments such as that headed by Michelle Bachelet (2006-2010) and centre-right executives such as that headed by Sebastián Piñera (2010-2014).

The saucepan-bashing demonstrators took the streets of Buenos Aires in 2012 and in 2013 it was Dilma Rousseff’s Brazil’s turn. Just when the country was celebrating the FIFA Confederations Cup, a prelude to the World Cup 2014, there was a wave of protests in the principal cities of the country. And the protests in São Paulo, Río de Janeiro and Brasilia had scarcely ended when the streets of Lima were also filled with demonstrators protesting against Ollanta Humala’s government.

The question that comes to mind is whether Latin America is entering an era marked by the turmoil of urban protests and social demands. The seeds of such phenomena have already been experienced in other countries such as Uruguay and Costa Rica and similar situations are expected to arise sooner rather than later in Mexico and Colombia.

These social protests in Chile, Brazil and Peru have a number of very special features, unprecedented in the region. They occur in a triple context of:

• Economic growth (not crisis, as in other times in the history of these countries or the current situation in Europe),

• Social change (emergence of heterogeneous urban middle classes) and

• Situation of clear dissatisfaction with the inefficient functioning of the State, the public administrations and delegitimisation of the parties and political class.

This report characterises these protest movements, studies their local dynamics in each country and makes a prospective analysis: where are they going and what effect could they have in the short term.

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2. COMMON FEATURES OF So all these movements have THE PROTEST MOVEMENTS three basic features in common, which can be summed up saying The participants in these that the economic situation movements, which have spread prevailing in the region as from throughout Latin America, are 2003 produced a social change from the new emerging classes, that has had serious, direct especially the urban middle political repercussions: classes and younger strata of the population. At first sight at least, They occur in situations of “In the past, these waves there is no clear leadership and economic stability of protests occurred they are pragmatic movements (seeking specific improvements, The first characteristic of all these at times of crisis and rather than political utopias) movements is an unprecedented accumulated political and although there is a certain phenomenon. They take place in socioeconomic tensions” presence of radical or ultra-left a situation of economic stability groups (such as the Communist and even relative prosperity, Party in the student protests in with economic growth of over 4%. Chile). Moreover, naturally, the new social networks (Facebook That same continuous, constant and Twitter) play a decisive role growth of the GDP in the region is in their origin and development behind many of the social changes and almost certainly in their that have happened (reduction prolongation over time. of poverty and inequality and a significant growth of the middle classes) and which are related GROWTH OF THE ECONOMY IN LATIN AMERICA with the current protests. Country 2010 2011 2012 2013* Argentina 9.2 8.9 1.9 3.5 In the past, these waves of protests occurred at times of Bolivia 4.1 5.2 5.2 5.5 crisis and accumulated political Brazil 6.9 2.7 0.9 2.5 and socioeconomic tensions. For Chile 5.8 5.9 5.6 4.6 example, the closest in time Colombia 4.0 6.6 4.0 4.0 were the protests in the late Costa Rica 5.0 4.4 5.1 3.0 nineties and beginning of the Cuba 2.4 2.8 3.0 3.0 following decade, which brought down the governments of Raúl Ecuador 2.8 7.4 5.0 3.8 Cubas (1999) on Paraguay, El Salvador 1.4 2.0 1.6 2.0 Fernando de la Rúa (2001) in Guatemala 2.9 4.2 3.0 3.0 Argentina, Gonzalo Sánchez Haiti -5.4 5.6 2.8 3.5 de Lozada (2003) in Bolivia Honduras 3.7 3.7 3.3 3.0 and Lucio Gutiérrez (2005) in Mexico 5.3 3.9 3.9 2.8 Ecuador, among others. All these governments collapsed following Nicaragua 3.6 5.4 5.2 5.0 massive citizen protests (then Panama 7.5 10.8 10.7 7.5 called “golpes de calle” Paraguay 13.1 4.3 -1.2 12.5 [street uprisings] —massive Peru 8.8 6.9 6.3 5.9 demonstrations that brought Dominican Republic 7.8 4.5 3.9 3.0 Uruguay 8.9 6.5 3.9 3.8 Venezuela -1.5 4.2 5.6 1.0 Sub-total Latin America 5.7 4.4 3.0 3.0 18 Source: Cepal THE PROTESTS ARE HERE TO STAY SOCIAL CHANGE AND MOBILISATION OF CITIZENS IN LATIN AMERICA

about the downfall of those Therefore, the underlying cause governments—) and occurred in of the current social unrest is that economically adverse five- not economic (as in the eighties year period called the Lost Half or between 1997 and 2003), Decade between 1997 and 2002 but rather political and social, “The underlying cause of (which witnessed the fall of the although the effects of economic the current social unrest Ecuador governments of Abdalá growth have been a very Bucaram in 1997 and Jamil important variable in triggering is not economic (as in the Mahuad in 2000). transformations of that nature. eighties or between 1997 and 2003), but rather Now, however, the economic Led by emerging middle classes growth figures of Latin American political and social” countries are not only high, but As mentioned earlier, these moreover consolidated since demonstrations were led 2003, with the sole exception mainly by the emerging and of 2009. The region got over consolidated urban middle the world crisis without any classes in Latin America. great difficulty. These ten years of high, continuous growth in the region accompanied by social policies, especially conditioned transfers, have brought a significant POVERTY IN LATIN AMERICA reduction of poverty (from 225 Poverty continues to fall in the region, to 167 million people between but still affects 167 million people 2002 and 2012) and extreme poverty (from 99 to 66 million). Poverty Extreme According to figures published poverty by the World Bank, “the Gross Domestic Product (GDP) per capita 225 on the continent rose at an average 204 215 Million people rate of 2.2% p.a. between 2000 and 2010. In six countries (including 184 Argentina, the Dominican Republic, 179 168 167 Panama and Peru), the annual growth rates of over 3% per capita 136 were produced during this period… The combination of sustained growth (albeit far from spectacular) and the reduction of inequality led to a considerable lowering of 99 95 91 the absolute poverty figures. The 73 62 69 66 66 rate of moderate poverty in Latin America was lowered from 44.4% 1980 1990 1999 2002 2009 2010 2011 2012 in 2000 to 28% in 2010, in spite of the global financial crisis in Source: Cepal y AFP

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the last two years of the decade in public transport in Brazil in (World Bank, 2011). This reduction 2013. That heterogeneous urban of poverty meant that there were middle class we are describing is 50 million fewer Latin Americans strongly present in all of them. The living in poverty in 2010 than 10 Brazilian example is significant years earlier. If compared with in this regard, since around 2003, the reduction in absolute thirty-five million Brazilians have figures is even greater: 75 million.” moved out of poverty since 2003. Whereas in the 1990s up to 25% of “The World Bank defines 75 million people who have the Brazilian population lived in the Latin American middle moved out of poverty to join extreme poverty, that number was the different strata of middle reduced to 2.2% by 2009. classes as ‘urban, with classes (heterogeneous and highly better education levels, diversified), which have grown But what do we understand by mostly employees in the and over the same years. middle class?

private sector and with As pointed out by the World There is no consensus in the beliefs and opinions Bank, “After decades of academic world of what is which, in general, stagnation, the middle class understood by middle classes, coincide with those of population in Latin America and since the definitions given from the Caribbean has grown by the points of view of sociology (a their poorer and less 50% from 103 million people in lifestyle), psychology and economy educated compatriots’” 2003 to 152 million (or 30% of (income brackets ranging from 10 the population of the continent) to 50 dollars a day per capita) do in 2009. During this period, as not always coincide. The World household income grew and Bank defines the Latin American inequality tended to diminish in middle classes as ‘urban, with most countries, the percentage better education levels, mostly of poor population fell employees in the private sector considerably, from 44% to 30%. having beliefs and opinions which Consequently, the percentages generally coincide with those of of middle class population and their poorer and less educated poor people in Latin America compatriots’. are currently equal. This situation contrasts with the This segment of population is situation prevailing (for a long now the most important link in time) up to almost 10 years ago, the regional economy owing to when the percentage of poor its purchasing power and many population was equivalent to experts consider that its sudden approximately 2.5 times that of appearance is the greatest social the middle class.” change in the history of the region since the migrations from country There are at the same time marked to city in the fifties and sixties. But differences and close parallel in it is a very heterogeneous middle the mass student protests in Chile class, as shown in the following in 2011, the saucepan-bashing graph. It includes sectors half protests in Buenos Aires in 2012 and way between poverty and the the protests against the increase middle class (those with incomes

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of 4-10 dollars a day) and within That complexity mentioned by the middle class itself there is a Iglesias arises because the middle broad spread between the lowest classes feel left out of a system incomes (10 dollars a day) and the that does not take them into highest incomes, which do not fall account or provide any solutions far short of the lower end of the to their most urgent claims. élite (50 dollars a day). Andas mentioned in the World Bank report, the governments This appearance and growth of the are running up a double deficit “The World Bank has middle classes contributes towards in respect of the demands of the warned of the growing the shaping of more modern, middle classes: but also more complex societies. unrest of the middle The Secretary General of SEGIB, They do not incorporate “the classes over the fact that Enrique Iglesias, has been warning objective of equal opportunities, ‘the middle classes are about this for some time: “We especially in public policies. are going to have a new society This is fundamental to ensure increasingly required to of middle classes. We are already that the middle classes feel that pay for services which are seeing evidence of this. Societies they live in a society in which it provided free for others’” of middle classes that are difficult is worth making an effort and to govern. Certain of their features where merits are rewarded, require a change in the way we do instead of a society that favours politics; they are middle societies the privileged groups.” which demand new services, new ways of participating and good The World Bank has warned of quality services; this is the case the growing unrest of the middle of education.” classes over the fact that ‘the middle classes are increasingly required to pay for services which TRENDS IN THE MIDDLE CLASSES, VULNERABILITY AND POVERTY are provided free for others. A IN LATIN AMERICA AND THE CARIBBEAN, 1995-2009 system of dual social protection based on selective assistance for the poor and on insurance 50 (subsidised) for the middle classes 45 might also be inadequately adapted for a large, vulnerable 40 population that is neither poor 35 nor middle class and whose vulnerability will increase if the 30 external environment becomes 25 less favourable than in the past.”

20 Poor (US$0-4/day) The World Bank also reveals that 15 Vulnerable the public policies have so far (US$4-10/day) not been capable of putting an

Percentage of population Percentage 10 Middle class end to “the vicious circle of low 5 (US$10-50/day) taxes and poor quality public services which leads the middle 0 and high classes to opt out.” 1995 2000 2005 2010 Source: World Bank

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Growing political dissatisfaction have occurred in Chile, Brazil among citizens and Peru, since, being unable to channel their unrest through “The great paradox of The great paradox of these protest the political system, all these these protest movements movements is, therefore, that they emerging social sectors have taken occur in economically successful it to the streets. The writer Moisés is, therefore, that they countries with modernised Naím has highlighted the parallel occur in economically societies (the middle classes between all these movements successful countries with have grown and poverty and even and their common political inequality have been reduced). roots: they begin with small modernised societies” incidents which start to grow, the “Prosperity cannot buy stability”, governments react inadequately —according to the analyst and (with repression, reproach or writer Moisés Naím—. “The merely ignoring the protests) and greatest surprise of these street this further fuels the discontent of protests is that they take place these social sectors, which have in economically successful no clear leaders. countries… Brazil has not only moved millions of people out of Therefore, the political system poverty, but has even managed to does not appear to be capable reduce its inequality. In all those of dealing with the demands countries the middle class is now of those middle classes, which larger than ever.” themselves embody a social but also political change, as stressed Those economic and social by the secretary general of SEGIB, changes are not being channelled Enrique Iglesias: “A middle class by the political system, which has that is practically dominating been incapable of adapting to the the world. The figures vary, new circumstances; it still acts in but almost certainly 50% of the the same way as in the eighties, population in Latin American when democracy returned to countries are middle class. That is the region. There is a growing an important phenomenon which rift between the State and those must be administered politically, middle classes. The World Bank and this task entails a new way of concludes that “The middle doing politics.” classes will not participate in or contribute to an improved social The political systems have proved contract if the assets they value themselves inefficient (they do not so highly (such as protection of provide solutions or answers to the civil rights, education, police social demands for better public and the health services) are services) and do not arouse citizen inadequately provided by the support, for several reasons: State and if they don’t perceive that the rich are contributing • Inefficient State faced with a fairly to the social contract.” revolution of expectations

This explains the widespread What these governments expressions of discontent that actually face is a revolution

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of expectations which they to the Adimark poll, have so far been unable although there has been to channel or organise: an upturn in recent times the emerging sectors have to around 37-39%. moved on to a new stage and they want and demand, »» In Argentina, Cristina above all, more and better Kirchner, re-elected in public services. the first round in 2011 with 54.1% of the votes, According to Moisés Naím: “In has just seen her political societies going through rapid party defeated in the transformation, the demand principal districts in the “What these for public services grows faster local elections, obtaining governments actually than the governments are able just 25% of the votes, face is a revolution of to meet it. This causes a rift 30 points down on what that brings people out onto she obtained two years expectations which they the streets to protest against ago, before the wave of have so far been unable the government and fuels saucepan-bashing protests to channel or organise” other highly justified protests: were unleashed in 2012. the prohibitive cost of higher education in Chile, or the »» Dilma Rousseff, who had impunity of corrupt politicians 58% approval in March, in Brazil.” saw her popularity fall by 20 points in June — As a result of this revolution following the wave of of unchannelled expectations protests coinciding with and consequent unrest, the Confederations Cup— certain governments have lost sliding to 30% according to considerable support, even to a Data folha poll in July. the point of electoral defeat, owing to their inability to »» The Peruvian Ollanta give a political response to Humala has faced the social demands. protests in Lima just when his popularity was falling, This is illustrated with a few as observed in an Ipsos examples: poll, showing that her acceptance fell from 54% »» In Chile, Sebastián Piñera in February to 33% in July. has had very low levels of popular acceptance ¿What are those middle throughout his term in classes asking of the political office: he was elected class? Better public services in the second round with and a less corrupt, less 51.6% of the votes, but patronage political system. over the years of strong Enhanced public services student protests citizen (education, health, transport approval dropped to and citizen security) lead to below 30%, according improved purchasing power,

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since fewer funds need to new, with their aims and be tied up in private medical ambitions, they increase insurance, private education their demands on the State. or private security. The consolidated middle classes can continue using As reflected by Michael private education or health Shifter, president of Inter- systems, but the new middle American Dialogue, “[all classes need improvements that unrest] is a product of and more accessible public economic and social progress systems to be able to and the expansion of the consolidate their status. middle class in countries such Moreover, the middle classes “Those middle classes, as Brazil, Mexico, Chile and that miss out on globalisation Colombia. Many young people would also benefit from a mostly politically in the middle classes in Latin general improvement of the disorganised, have a America (students in Chile and public systems.” significant political Brazil, teachers and lecturers influence because their in Uruguay) are disenchanted This reflection coincides with with traditional politics, both the figures of the Americas demands put pressure right-wing and left-wing. Barometer, which indicates, on governments which They want the governments, for example, that “in the last are not usually ready to which now have more funds, decade, the Brazilians are to provide higher quality among the Latin American respond quickly” services and they are tired citizens most dissatisfied with of corruption and mistaken the welfare services provided spending priorities.” by the government. Much of this situation is probably That dissatisfaction with due to the high taxes paid by deficient public services, Brazilians (around 36% of the sometimes —as in Brazil— GDP) and the perception that exacerbated with heavy tax they are paying taxes at rich burdens, explain much of country levels in exchange what has been happening for services more fitting of in Latin America. Indeed, poor countries.” those middle classes, mostly politically disorganised, have The ten most dissatisfied a significant political influence countries include, apart from because their demands put Brazil (third), Chile (fourth) pressure on governments and Peru (sixth), two nations which are not usually ready to that have suffered this type of respond quickly. social protests. The protests in Chile in 2006 and 2011-12 As indicated by Ludolfo focused on education and, Paramio, lecturer at the above all, on how to rebuild the CSIC (Spanish Scientific university system and finance Research Council), “Owing higher education. According to the very nature of the to Micheal Read, editor of middle classes, both old and The Economist specialising in

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Latin America: “In all cases the protests that have taken they are expressions of the place in recent years in the discontent of citizens who region. Chile set the protest are less poor, less worried, ball rolling with the “penguin at least for the time being, revolution” in 2006-07, the “The system losses its about the economic situation unrest over the inadequate and much more demanding as operation of Transantiago legitimacy in the eyes of regards what they want from (the public transport system its citizens, who see that the State and political system. in Santiago) afterwards and the State is incapable Although the specific demands in this decade the university are different, they have that protests in 2011, which of providing them in common.” caused Sebastián Piñera so with physical or legal many headaches. security, or adequate • Loss of legitimacy of the system Behind them all was a public services” “revolution of expectations” A revolution of expectations of the middle classes not that have not been met by the State. “Part of adequately met has a direct this problem is caused by the political repercussion: the success of the Concertación1: system losses its legitimacy in 20 years it managed to in the eyes of its citizens, open up access to education who see that the State considerably. Secondary is incapable of providing education was made universal them with physical or legal and university education security, or adequate public grew. But with a loan system services and sometimes, as with interest rates at 10% in the case of Venezuela and p.a., the problem blew Argentina, even controlling up. And it has done so now inflation. As also mentioned because the students are in the Americas Barometer, now finishing their university “in 2012, around 65% of studies. In 1990, one out Brazilians perceived that the of every five Chileans in political system was corrupt… university age got into higher and (Brazil) was twenty- education; now it is one out second out of 26 countries of every two”, comments in the Americas in 2012 in Patricio Navia, lecturer at support for the national the Diego Portales University. political institutions.” This fact, economic success Those two circumstances, that does not guarantee dissatisfaction with the peace of mind or social governments’ public policies satisfaction, merely confirms and little attachment to the the change experienced in institutions, are present in Chile. As reflected by the

1 Concert of Parties for Democracy, a coalition of centre-left parties

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economist and intellectual who came from that vast, Sebastián Edwards in the widely diversified sector of daily newspaper La Tercera: the middle classes (who, we “Chile is trapped. Trapped recall, start with salaries of by relentless unrest, by a 5000 or 6000 pesos), were “Chile is trapped. deep mistrust of politicians not protesting only because Trapped by relentless and institutions, by a sort they could not buy dollars. unrest, by a deep of persistent melancholy.” They also had other slogans “Politics sucks”, says the man and converting them all mistrust of politicians in the street. “There is an into a pretext concealing and institutions, by institutional crisis”, repeat the their desire to have foreign a sort of persistent women in the supermarkets. currencies at the official “The neoliberal model has price was to disregard them melancholy” failed”, shout the students in entirely. It is the symmetrical Sebastián Edwards their demonstrations. version of those who say that the participants in the And he adds: “Chilean families anti-Kirchner demonstrations are proud of what each of were ‘out for the plan and them has achieved during the choripán2’.” the last quarter of a century: moving into the middle class, In Brazil, the demonstrators the university degree of one in the June protests were not of their daughters, their poor people uprooted from dream holiday, the grant the shanty towns but from awarded to their nephew. the middle class, which was Personal satisfaction and demanding efficiency and social discontent coexist anti-corruption measures in present-day Chile. Many from the State. consider this illogical, but that’s the way it is.” Long gone are the days of the renowned “he steals, Meanwhile in Argentina, in but he acts”, which in the 2001 during the famous “get fifties raised to power figures them all out”, there was such as Adhemar de Barros, a prelude of that “middle mayor and governor of São class rebellion.” It has now Paulo, where people said reappeared in the saucepan- “Adhemar rouba mas faz” bashing protests of 2012 (“Adhemar steals but acts”). and 2013 against Cristina Juan Arias, correspondent in Kirchner’s government. Brazil for the daily Spanish newspaper El País, considers The analyst and historian that “The new middle class is Beatriz Sarlo agreed with now demanding “first world this diagnosis, stressing public services —education, that “The demonstrators, transport, hospitals—”, as

2 a type of sandwich with chorizo [sausage] popular in several Latin American countries.

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well as politicians with less that “in the rest of Latin corruption and squandering.” America, part of those middle classes does not receive the Just as in Chile, in Brazil subsidies intended for the economic success is poorest strata and want a ironically the source of piece of the cake, yet they the current problems. As are not prepared to wait for explained by Michael Read: that fortunate day in the “The interesting thing about future to receive their share. the recent protests is that Consequently, the question they reflect the success ‘what about my part’ is of the past 15 years, the running rife throughout the socio-economic success region, north to south and “There is a narrow that has created almost full east to west.” but greatly populated employment in Brazil. Real purgatory between salaries have been rising, This is so, undoubtedly, up to this year, and there because the public policies those two states, are far more people with have reached the poor characterised more money. But there is segments of society but by considerable a gulf between the size of not so much the vulnerable the State and the services it middle classes with income vulnerability and a provides. The tax burden in of “between US$4 and US$10 high risk of sinking Brazil is 36% GDP, which is per person a day. They are back into poverty” high for any country of that too well-off to be considered size. However, the level and poor, but too vulnerable quality of the public services to be considered middle are rather poor, in education, class. It is certainly not a but especially in health and small group: it covers 37.6% transport. If we add to this of the population on the the growing awareness that continent... Moving out of there is a lot of public money poverty, —as defined by most and that a large part of that countries and international money is being wasted and organisations—, is not squandered, that explains enough to join the ranks the fury and reveals the of the apparently well-off reforms that are needed.” and economically secure middle class. There is a In short, in each of these narrow but greatly populated countries the different internal purgatory between those dynamics and the coinciding two states, characterised by general circumstances have considerable vulnerability converged, bringing about and a high risk of sinking these outbursts. Looking at back into poverty. As a group, the situation more globally, they are probably crucial for we must point out that the designing the social policies ultimate reason, according to of the continent, the political Carlos Malamud, researcher dynamics and the social at Real Instituto Elcano, is: contract in broad terms.”

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3. CONCLUSIONS that transition stops. However, the region cannot rely on the In the short and medium external environment continuing terms, we could conclude that to be as favourable as in the the social mobilisation of the recent past to achieve more heterogeneous Latin American social and economic benefits. middle classes is here to stay, So a much greater effort will be for two basic reasons: required in designing policies to “In the short and consolidate and make further medium terms, we • Firstly, because as we have progress in the rising mobility, could conclude that the seen, the public policies making it more resistant to of the governments in the potential adverse disruptions. social mobilisation of region have not been capable In the end, the responsibility the heterogeneous Latin of responding to the new will fall on the shoulders of the American middle classes demands raised (better public political leaders and democratic services) by these segments of institutions in the region, which is here to stay” the population. face the challenge of redefining their social contract.” • And secondly, because the region is moving towards a With low economic growth in much less favourable economic of the world (the EU in recession, climate of deceleration, the USA with weak growth and slowdown and even China approximately two points crisis in some cases. This down in its GDP), exports will fall unfavourable, or at least and, consequently, so will the State not so favourable, situation income, reducing the margin of has already been admitted public policies and the possibility by the governments. In the of extending them to the middle emblematic case of Peru, classes. Those middle classes will the minister of economy, grow at a slower pace this decade Luis Miguel Castilla, has and will be even more vulnerable admitted that “Peru has due to the smaller growth rates. strengths, but it must urgently carry out internal These protest movements will tasks in order to cope with a have three more characteristics less favourable climate.” in the near future: they will extend geographically and be As pointed out by the World Bank: clearly discontinuous. “Throughout most of the 2000 decade, the enhanced framework • Not only will the protests of the policies in Latin America continue, but there is a good enabled many countries to take chance they will extend to advantage of a benevolent other countries such as Mexico, external environment to begin an Colombia and Venezuela. impressive transition towards a middle class society. This created “It is a product of economic great expectations which run the and social progress and the risk of turning into frustration if expansion of the middle class

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in countries such as Brazil, governments in decline (such Mexico, Chile and Colombia”, as Sergio Massa in Argentina) or says Michael Shifter, known benchmark opponents president of Inter-American such as Marina Silva in Brazil Dialogue, adding that “The will be able to channel the discontent in Brazil which discontent. In the short has surprisingly reached the term, the possibility of surface reflects a tendency a cheap imitation of the throughout the region.” Italian anti-system Five Star Movement appearing on the • Moreover they will be scene seems unlikely. (actually they already are) “The moderate movements characterised That is becoming perceptible middle class sectors, by cyclical rises and falls: in Argentina, for example, the backbone of the very marked and active at where the middle class and specific, symbolic times emerging middle class vote is protests, have been (Confederations Cup, being channelled through the pushed into the pope’s visit or World Cup) tactical vote to candidates such background as the more followed by times of less as Sergio Massa (governor and activity, when radical groups former minister in the Kirchner radical and violent might take control of the government, Peronist and now groups advance and movement, something which opponent of Cristina Kirchner). take over” is already happening in Brazil. The moderate middle The results of the local elections class sectors, the backbone held on 11 August indicate just of the protests, have been that. A report published by the pushed into the background daily La Nación indicates that as the more radical and “Kirchnerism lost votes in all the violent groups advance and urban centres of the country, take over. As indicated by falling 24% on average compared Moisés Naím: “The protests with the 2011 elections. This will no doubt ease off in figure, essential to understand the these countries. But that severe defeat of the government, doesn’t mean their causes is especially illustrative of the will disappear.” change of direction of the middle class. According to the analysts, • As to whether these movements the bad performance of Kirchner’s will become institutionalised, government in urban centres organising themselves into reflects the impact of inflation, parties or forces that embody insecurity and corruption. The their message and intentions, map includes large towns and at least in the short term it cities in which a defeat of the FPV looks as if the old parties or was taken for granted —Mendoza, coalitions (such as the Chilean Córdoba, Rosario and Santa Fe—, Nueva Mayoría —the successor but also provincial cities where of the Concertación— led by defeat was not expected, such as Michelle Bachelet), politicians Catamarca, La Pampa, San Juan having nothing to do with the and Corrientes.”

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As indicated by the sociologist be numerous demonstrations but Liliana de Riz: “The combined within a very specific context: furies that were not heeded the left-wing protests (led by the exploded in the street and radical left party of Andrés Manuel ended up making themselves López Obrador and the more heard through voting.” “The moderate PRD) against the energy middle class lost confidence reform promoted by the president in the government’s ability to Enrique Peña Nieto, aiming to maintain the current levels of attract private capital to Pemex. spending and well-being, which, “The middle class without long-term policies, In Venezuela the citizen protests lost confidence in the were only sustainable in the against inflation, shortage of government’s ability to official account”, assures the supplies and insecurity (which hit academician Levy Yeyati. the middle and lower middle classes maintain the current especially hard) will inevitably be levels of spending and Similarly, in the presidential mixed in a high polarized political well-being, which, without elections in Chile this year context (Chavism vs anti-Chavism), the vote of discontent will be local elections on 8 December and long-term policies, were channelled mostly towards emergence of a unified, stronger only sustainable in the the former Concertación, now opposition around Henrique official account” Nueva Mayoría, led by Michelle Capriles while the regime faces a Bachelet, while the protest vote difficult transition between the Levy Yeyati less attached to the traditional charismatic leadership of Hugo trends will be minority and Chávez and the much lower profile embodied in two independent of Nicolás Maduro. candidates, Franco Parisi and Marco Enriquez-Ominami, who In Colombia, the May elections, will each receive around 5% of negotiations in Havana with the the votes. FARC guerrillas and the current crisis of the different left-wing The same thing can be expected movements and parties will keep to occur in Brazil, where Dilma the protests in check. At present, Rousseff’s PT and the PSDB those protests are more related headed by Aécio Neves will mark with the problems of different the electoral flux in the 2014 trades (illegal miners, coffee presidential elections. If there are growers and lorry drivers) than any novelties, they would come in with the demands of the new the form of increased support for middle classes. the green candidate Marina Silva, who was the third most voted in In other countries (Ecuador and 2010, or the moderate socialist Bolivia, among others), these Eduardo Campos, hitherto movements are unlikely to be allied with Lula and Rousseff, as structured in the short term. governor of Pernambuco. The charismatic leadership of Rafael Correa and Evo Morales The scenario might be similar and the absence of national in other parts of the region: in union and political opposition Mexico there will almost certainly forces prevent this. In Ecuador,

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just the government’s decision protests demonstrate those to drill oil in the Yasuni ITT labour pains of a more modern, area might be used to induce heterogeneous, complex, young people, ecologists and autonomous society with critical “A new Latin America indigenous peoples to challenge capacity. The challenge of the is being born in social the extraction plans of Rafael State and political system will aspects and the protests Correa’s government. be to respond to and channel those demands by continuing to demonstrate those labour A new Latin America is being extend the reach and improve pains of a more modern, born in social aspects and the the quality of public services. heterogeneous, complex, autonomous society with critical capacity”

31 Audiovisual Overview of Latin America Concentration and technological renewal

Madrid, july 2013 AUDIOVISUAL OVERVIEW OF LATIN AMERICA CONCENTRATION AND TECHNOLOGICAL RENEWAL

1. INTRODUCTION 1. INTRODUCTION 2. THE GROWING PROCESS OF CONCENTRATION AND The audiovisual landscape is complex and rapidly evolving in Latin GLOBALISATION America, particularly in the almost decade and a half since the 3. THE PERVASIVE PENETRATION beginning of the 21st century. This profile is the result of technical, OF AUDIOVISUAL MEDIA business and political changes occurring in the region. 4. THE RISE OF STATE INTERVENTION This report will offer a portrait of television in the region highlighting 5. THE FUTURE: BROADCAST, PAY the main features of the model and the challenges it will face in a AND DTT TELEVISION future characterised by the following developments: 6. CONCLUSIONS • The growing process of concentration and globalisation

• The pervasive penetration of audiovisual media

• The increased intervention of the state via legislation and as a communication player through public channels

• The diversification of platforms for the future: broadcast television, pay and digital terrestrial television and the audience fragmentation they produce

These four points underscore trends in the region, in line with those occurring worldwide, which involve the appearance of a number of mega-corporations that dominate and in some cases hegemonise the audiovisual market (concentration) in a sector that wields social influence, as more than 90% of the population has access to at least one television (penetration). Simultaneously, technological changes have diversified supply and fragmented audiences.

This situation has led to various governments —ranging from those aligned with the political centre-right such as that of Peña Nieto in Mexico and others involved in “21st century socialism” such as Rafael Correa and others with clear leftist populist leanings such as Cristina Kirchner— to try very different ways of exerting more control over mass media in general and audiovisual media in particular (state intervention).

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2. THE GROWING PROCESS This process has been accompanied OF CONCENTRATION AND by the prevalence of modern GLOBALISATION business structures (less related to family interests than before) that have created globalisation-inspired The structure of television in Latin alliances with major transnational America is determined by three groups which themselves become, in distinct dynamics: some cases, “multilatina” companies.

“Public media have thus • High levels of concentration This economic and geographical far failed to occupy in the media sector. concentration is linked to major urban centres, in most cases the a central position • High level of centralisation capital of each country. within the range of the sector. This process in- of available media” cludes the production of con- As stated by Professor Bernardo tent in main urban centres, Diaz Nosty, Founder and first thus relegating the interior President of the Association for areas of each country to the Research in Communication and role of consumers of content Director of the UNESCO Chair in produced by others. Communication at the University of Malaga, “technological • Television has developed his- convergence and contemporary torically in the region as an corporate logic combine to essentially commercial ven- promote media concentration. ture, and public media have Digitized messages travel faster, thus far failed to occupy a farther and cost less than before. central position within the Companies that already have range of available media. communication resources are better able (unlike, for example, Media concentration in Latin new audiovisual production America (generally the top four groups) to disseminate the stations account for 80% of audience content they produce.” and turnover) is not a recent phenomenon, but goes back to the The trend has brought on very beginnings of television in Latin appearance of communication America. What is unprecedented mega-groups such as Televisa is the degree of integration in Mexico, O Globo in Brazil, (horizontal, vertical and multimedia) Cisneros in Venezuela and Clarín and concentration of the current in Argentina. television industry: media owners are also owners of landline, mobile “These groups, as noted by and data transmission companies. journalist and professor at the Their business is not limited to University of Seville (Spain) television but also includes radio Mancinas Rosalba Chávez, are and newspapers (traditional, free, connected to financial and tech- popular and sport). nological (telecommunications)

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networks. In addition, they have In Colombia, the audiovisual been gradually merging (a dy- sector is also characterized namic which will continue in the by the duopoly of two major future) and establish short-term media groups with a high level alliances or agreements for spe- of concentration: Grupo Santo cific actions and the purchase/ Domingo (Caracol) and Ardila sale of products.” Lülle (RCN). Both groups have alliances with international con- This concentration does not glomerates and own broadcast “This concentration does exclude the more recent and cable television stations as not exclude the more appearance of regional and well as production, publishing, community media that have radio, newspaper, internet etc. recent appearance of driven the modest level of According to the IBOPE audience regional and community diversification that exists. measurement company, both na- media that have driven Although their range is smaller tional private channels account and their economic capacity for more than 50% of audience the modest level of limited, their influence could be share in Colombia (RCN with diversification that exists” key to mobilising local groups. 26.9% and Caracol with 25.2%), while no public channel has Concentration rates vary from more than 1%. country to country: • In most countries in the rest of • Some television systems are the region, three or four channels highly concentrated around a are particularly predominant. single operator (such as Bra- The level of concentration in the zil’s Grupo Globo). audiovisual sector in Peru is very high because just three private • There are also duopolies as in national television stations Mexico (Televisa and TV Az- command 50% of the total teca), Venezuela up to 2007 television audience. According (Cisneros Group (Venevisión) to IBOPE data, the share of and Grupo 1BC) and Colombia América Televisión is 21.3% (Caracol and RCN). (Grupo Plural TV, controlled by Grupo El Comercio), while ATV Specifically, Mexico’s audiovisual (ATV Group, controlled by structure is characterised by the Mexican-American Ángel the historic “duopoly” of two González) holds 13.3% and major media groups: Televisa, Frecuencia Latina (managed owned by the Azcárraga by Baruch Ivcher) accounts family, and TV Azteca, in for 13.2%. hands of the Salinas family. The channels from these two In Argentina, four stations large corporations account for (Cana 11, Telefé, Canal 13, nearly 97% of viewers across Canal 9 and Canal 2) account the country, giving them for more than 90% of the au- major media, economic and dience. However, just three political power. business groups —Grupo

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Clarín, Telefónica and Grupo In fact, the penetration of ONE— control nearly 50% of broadcast television is ex- all broadcast stations. In Bo- tremely high throughout the livia, four channels (UNITEL, region: nearly 100% in Argentina. Red Uno, ATB and Bolivisión) have held 90% of the au- In Brazil, TV is also the medium of dience since the 1990s, but communication par excellence, in the last five years a new as it has had the highest player, the PAT network, has penetration rate in the region joined the fray. since the 1990s. Hence, Brazil “If anything unites all is the largest Latin American social classes in Latin Unlike these countries, Ecua- broadcast commercial television dor’s communication sector has market, with coverage of 98% America it is that there is a structure in which the state is of households that represent at least one television set one of the largest media hubs a potential audience of 175 in every household” due to the seizure of large com- million people. panies carried out in 2008 from groups of ex-bankers as in the Television is also the most case of the Isaias brothers. Thus consumed media by the 120 the state is currently managing million people in Mexico, where more than 20 media outlets, in 98% of households receive addition to being an internet and broadcast TV and just over cable television provider. Mean- 32% pay TV. The same situation while, the space for business exists in Colombia, where TV groups that manage private me- is the most consumed media dia is shrinking. Under the consti- by the country’s 47 million tution, the Eljuri and Egas groups inhabitants, and its penetration had to sell their media compa- rate is 94.4%. nies because they hold shares in or own financial firms outright. Similarly, television in Peru is And now, there are only a few the country’s most widespread families running media organi- information technology and sations: groups such as Vivanco, communication medium. It is Martínez, Alvarado, Mantilla, etc. the gateway to information, entertainment and opinion for most of the country’s nearly 3. THE POWERFUL SOCIAL 30 million people. 99% of PENETRATION OF AUDIO- households have a television VISUAL MEDIA at home, and about 30% have access to pay TV. In Venezuela, the rate of household Despite the social differences penetration is 95%. and gaps in many sectors, if anything unites all social classes Even in countries with lower in Latin America it is that there penetration rates, the figure is at least one television set in remains high. This is the every household. case of Ecuador, where the

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“PAY TV” PENETRATION - TOTAL INDIVIDUALS BY COUNTRY (%)

rate exceeds 90%. Almost 16,5 2008 everyone receives broadcast 18,7 2009 TV, while the penetration of 22,0 2010 pay TV is 14.5%.

Brazil 29,1 2011 36,1 2012 This significant penetration 46,2 2013 combines with the current increase in audience fragmen- 29,4 tation. Until the 1990s the 30,8 fundamental characteristic of 32,2 audiences was their segmenta- 32,2 tion, which resulted in all com- Mexico 40,5 mercial stations developing and 40,5 designing their programming schedules for audience segments in accordance with their habits 40,4 and consumer availability. 46,2 46,8 However, since the 1990s, 49,9 60,9 audiences have become more

Central America 64,6 sophisticated depending on age, sex, social status and, simultaneously, the offer has 35,0 become more diversified in 47,9 keeping with technological 54,7 advances (to give just one

Chile 59,5 example, in Bolivia new digital 63,9 television legislation will allow 67,8 each frequency to carry 3 channels, making it possible 45,1 to offer 66 digital channels as 50,6 opposed to the current 22). The 54,7 expansion of the pay TV system

Peru 63,3 has broadened the offer of 62,4 programming and promoted 68,1 thematic specialisation amongst channels. The process of migration of broadcast 68,6 commercial channels, which 76,0 have lost significant audience 77,8 share, towards pay TV channels 77,8 . This Colombia has been accentuated 81,3 trend has accentuated audience 84,4 fragmentation, from a very small number of broadcast channels, 73,5 which had been hegemonic, to 72,9 an extremely diversified range 78,6 of pay channels. 78,4

Argentina 81,3 83,4

0 20 40 60 80 100 37 Source: LAMAC (http://www.lamac.org/chile/comunicados/imparable-crecimiento-de-la-tv-paga-en-latinoamerica/) AUDIOVISUAL OVERVIEW OF LATIN AMERICA CONCENTRATION AND TECHNOLOGICAL RENEWAL

This fragmentation affects The flood of new channels and ratings. In Argentina, audience increasingly easier and cheaper share for pay TV stood at 50% access results in a fragmenta- of the population during the tion of the viewing audience, first quarter of 2013, a record which is becoming less con- in terms of consumption of this centrated and more divided, medium. In Chile, audience making it difficult to achieve share for pay TV has grown in double-digit ratings. the last five years from 40% in 2008 to 45% in 2013. In Colombia These data are confirmed by audience share for pay TV set a audience ratings in countries “The flood of new new record in April 2013 with a such as Argentina, where Telefe channels and increasingly percentage of 43.5. arrived in 2012 with 11.2% share, 1.7% higher than its main easier and cheaper access This reality, which is already competitor, Canal 13, which had results in a fragmentation present in these Latin American 9.5%. These figures from Telefe of the viewing audience” countries, is nascent but were due to the great success significant in others such as of the series “Graduados” and Mexico where Televisa is still “Dulce amor”. The third ranked has the largest audience share station was Channel 9, with but has been losing ground. 4.7%. América was fourth with Televisa has 43.4% audience 4.3%, while Canal 7 achieved an share, followed by pay TV with average of 2.7%. 27.4% while TV Azteca has been relegated to third place with The phenomenon of fragmen- 19.5% market share. tation occurs in both Chile and Argentina, where audiences and Fragmentation is making its TV ratings barely reach dou- way to Mexico through pay ble digits. Channel 13 was the TV, which has increased its TV highest rated channel in 2012, audience share by 53% in the with an average rating of 8.9% last three years: according to because of hits such as the TV the annual study conducted by series “Soltera otra vez” and the Nielsen-IBOPE, pay TV outlets reality show “Mundos opuestos”. (about 90 channels) exceeded Behind them came TVN with the audience for TV Azteca, 7.7%, followed by Chilevisión at the second largest broadcast 7.1% in third place and Mega in network in Mexico. fourth at 6.6%.

This same phenomenon is In Peru, the fight for audience taking place in a bigger way share is embodied in the in Brazil. In 1993, the O Globo competition between América, network had a 56-59% audience ATV, Frecuencia Latina and share; it now reaches only 37% Panamericana, while in Colombia of the population. IBOPE reports that Caracol

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exceeded RCN in audience telenovelas have the ability share in 2012, a feat it had only to top football matches from managed accomplish twice since the national and international 1998. Caracol Televisión has leagues (the Spanish and fallen from 36% to 28%, while RCN English leagues and Europe’s remains at 27% after peaking at Champions League), regional 35% in 2006. Caracol TV based its tournaments such as the success in 2012 on productions Copa Libertadores and such as “Escobar”, “El Patrón del supranational tournaments Mal”, “Rafael Orozco”, “El Ídolo” such as the World Cup, the and the reality show “La Voz Confederations Cup, Eurocopa “Sport in general and Colombia”. In Brazil, TV Globo and the Copa América. football in particular is occupied the first ten places in the rankings thanks in part to its 9:00 one of the star products Thus, for example, in Chile, p.m. telenovela “Avenida Brazil”, the two most-watched in the region” which achieved an average rating broadcasts in the first quarter of 19.5%, followed by the newscast of 2013 were the Peru-Chile Jornal Nacional (14.5%) and Big match on 22 March, which Brother Brasil (13.5%). headed the list at 41.8%, followed by the 41.5% share According to a study by AGB Nielsen, from the match between Chile the ten most watched programs and Uruguay on 26 March. on Venezuelan television in 2012 were broadcast by Venevisión Football has become a tele- (Grupo Cisneros), with a 46% vision business, and income national share. The channel Televen from TV rights for the major (Televisión de Venezuela) posted a leagues in Latin America rose 31% share, behind Venevisión, while by 56% in 2012, exceeding VTV achieved 11% and Globovisión USD $1 billion. According to 8%. In Mexico, the predominance a report by the consultancy of Televisa has remained relatively Dataxis, television rights to unaffected by TV Azteca: as football matches in first divi- stated before, Televisa has a 43.4% sion leagues in Argentina, Bra- audience share, followed by pay zil, Chile, Colombia, Mexico and TV with 27.4%. TV Azteca has Peru generated USD $1.07 bil- been relegated to third with 19.5% lion. Four countries —Brazil, market share. Argentina, Chile and Mexico— accounted for over 90% of the As for audience tastes it should figure for 2012 and rights to be noted that the most watched the Brazilian championship and the most popular shows con- match were valued at USD tinue to be those that have tradi- $610 million in 2012, almost tionally been broadcast: 57% of the total.

• Football: sport in general Sport broadcasts are more and football in particular than a business for football is one of the star products clubs and broadcasters: they in the region because only are also a political weapon.

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In Argentina, Cristina Kirchner’s has educational objectives government acquired from and influence. According the Clarín Group, with which to a study by the Brazilian it had had a stand-off since Society for Interdisciplinary 2008, broadcasting rights for Studies in Communication, the local league and created “the telenovela became, “Fútbol para Todos” (Football throughout its history, not only for All) to provide broadcasts the most profitable product of Argentina’s league matches. for the Brazilian audiovisual Providing what until then had industry, but also the most been available via pay TV culturally significant format “Sport broadcasts are through the state programme after the Brazilians began to more than a business Fútbol para Todos was see themselves reflected in for football clubs and considered to be a move with them, sharing common points clear populist overtones. In of reference.” broadcasters: they are Ecuador the situation is similar: also a political weapon” the three largest state channels At this time, in 2013, the (TC Televisión, Gama Tv and broadcast of telenovelas is Ecuador TV) took over the the only programming be- rights to broadcast the National sides football in each coun- Football championship. try capable of reaching and exceeding a 30% audience In Mexico, the fight is between share. The most striking cas- private parties: a “war” es are “Amores verdaderos” for football being waged on Televisa and “Los Rey” on between Carlos Slim, Televisa Mexico’s Azteca, “Solamente and TV Azteca. It should be vos” on Canal 13 in Argentina, remembered that América “Soltera otra vez” on Canal Móvil (owned by Slim) has 13 in Chile, “Avenida Brasil” interests in clubs such as on O Globo, “La reina de las León, Pachuca and Estudiantes carretillas” and “Solamente Tecos, while Televisa owns milagros” on América Tele- América and TV Azteca owns visión in Perú, “Tres caínes” Morelia and Jaguares. on RCN Colombia and “Vál- game Dios” on Grupo Cisneros • “Telenovelas” (soap opera) in Venezuela. are a regional phenomenon that have little to do with the We must take into account well-know cheap melodrama. the fact that Avenida Brasil, They offer higher production the Brazilian telenovela that value, more professional follows Jornal Nacional, broke mise-en-scène and well- audience records in Brazil and written scripts performed by surpassed the match between highly qualified actors. Argentina’s Corinthians and Boca Juniors, South America’s They also embody a genuine biggest two teams, with a television culture that transmits figure of 49%, one percentage values and in many cases point higher than the match.

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• After football and telenove- the media diversification, inter- las, the most watched pro- nationalisation and globalisa- grammes are reality shows, tion that did away with the old game shows and talk shows. “home grown” aspects of these These include the “El Progra- companies which had been ma de Susana Giménez” on linked to large families without Telefe in Argentina, reality external influences. shows such as “Combate” in Ecuador and “Desafío África” Indeed, as noted by William on Caracol in Colombia. Mastrini (Argentine professor at the University of Buenos Aires, “The 1990s were There are exceptions to the specialised in media concentration), characterised by dominance of football and one of the “essential features soap operas. “Periodismo of Latin American media, from increasing liberalisation, para todos”, on Canal 13 in its appearance and up to the deregulation and opening Buenos Aires, is an investiga- 1980s, is that its ownership and up of the economy tive journalism programme management was in the hands of hosted by Jorge Lanata that family business groups, which were in general and in the has topped football in terms gradually expanded and gave rise audiovisual business of viewership. to the giant conglomerates that in particular” control and concentrate ownership “The hegemony of telenovelas, of the media in the region. This still reality shows and series in occurs today, in spite of a dynamic primetime network TV may be marked by globalisation and affected by the fragmentation international business alliances. of the audience resulting These powerful family businesses from the availability of new grew in the shadow of political content, but these three power in a relationship that genres could be reinforced benefited both parties.” through a multiplication of the number of ‘clone’ offers Currently two regional and po- on future channels as the litical trends can be observed in result of a conservative view regards to relations between the of the television business,” state and the media: says Daniel Condeminas, a communication consultant Growing state intervention and professor at the University of Barcelona. In the last five years, several governments in the region have 4. THE RISE OF STATE IN- made changes to their mass TERVENTION media policies. The degree of state regulation of ownership concentration levels has been The 1990s were characterised stepped up. by increasing liberalisation, deregulation and opening up of In Venezuela, the audiovisual the economy in general and in industry had traditionally been the audiovisual business in par- dominated by two major private ticular. This process facilitated media groups, Grupo Cisneros

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(Venevisión) and Group 1BC, seeks to limit the expansion also called Grupo Phelps (RCTV- of Grupo Clarín as it limits the Radio Caracas de Televisión). number of cable channels as well as This structure changed as the corporate concentration practices. Chavez government became more powerful between 2002 and 2004 These governments seek to ad- and new state-owned channels vance two objectives through appeared (Vive and Telesur). these measures: Moreover, this structure was clearly modified in 2007 with the • To create new regulatory non-renewal of RCTV’s license frameworks. “The degree of state and the replacement of Tves with regulation of ownership a public station. The May 2013 Governments in the region sale of Globovisión, owned by concentration levels has are in a dynamic process of the Zuloaga family for years and making significant changes been stepped up” the only TV outlet open to the to legislation in the field of opposition, has led to uncertainty communication, as did Ar- regarding its new editorial gentina in 2009 and Ecuador position which is now assumed to in 2013. be close to the government. In that vein, the National In addition to the case of Assembly of Ecuador recently Venezuela, in 2008 the approved by a large majority Ecuadorian government seized a controversial measure that the country’s media, including regulates the media and two major TV channels, Gama that has been described by Tv and TC Televisión, from the opposition as a kind of Grupo Isaías. Additionally, it “gagging” order. The regulation has created some public media establishes, amongst other outlets such as Ecuador TV and things, a new distribution of the newspapers El Ciudadano frequencies that substantially and PP El Verdadero. Added to reduces space for the private this is the recent passage of sector. However, the aspect the Communications Act, which that the media have most mandates the distribution of complained about is the 100% of the airwaves equally creation of two bodies: the amongst public, private and Superintendency of Information community media. and Communication and the Media Regulation Council. In Argentina, Act 26.522 on Audiovisual Communication The former is responsible Services was enacted in 2009. It for “supervision, auditing, establishes guidelines governing control and intervention” the operation of radio and and may apply economic television media and creates and administrative sanctions government regulatory body, the to media organisations. Federal Authority of Audiovisual Meanwhile, the Media Council Communication Services. It also will have authority in various

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areas such as the allocation Venezuela and Ecuador are of frequencies. The law two prime examples. Until also includes the concept of 2004, Venezolana de Tele- “media lynching”, produced visión (VTV) was the only by the repeated publication public television operator. of information in order to Now, in 2013, there are “discredit or reduce” the seven: besides Venezola- public credibility of individuals na de Televisión, there are or legal entities. TVES, Vive, ANTV, Ávila TV and Telesur, the latter with • To provide governments two channels. “In other countries, with sufficient mechanisms the state has been to act as significant commu- This emphasis on public transformed in the last nication operators. television (for example, in 2007 the Rafael Correa government five years into a media There is no single model of in Ecuador created the public player that creates public television in Latin television station Ecuador its own channels” America. Cuba’s public Tv) representing a historical television holds a monopoly dynamic change from a position typical of a totalitarian situation of underdeveloped state, and public media in public television in a market Venezuela are highly politicised where private and commercial in favour of the government. In channels are predominant. It Mexico, national public stations is worth noting in the case aim to produce unique cultural of Ecuador that competition content, while in Colombia between public and private regional stations (eight in channels is unlikely because total) offer extensive public the state media are funded interest programming. by the state treasury, i.e. they do not compete for Moreover, in other countries, advertising because they do the state has been not need the income. transformed in the last five years into a media player A different phenomenon is tak- that creates its own channels ing place in Mexico. There are that have become not only traditional federal stations spokespersons for public such as Canal 11, Canal 22 and policy but also private media TV UNAM, some of which of- competitors. These new fer good quality and excellent state media, in the cases of programming content such as Argentina, Bolivia, Ecuador Once, which has received inter- and Venezuela, seek openly national awards. In addition to to compete with private these stations, there are also groups for audience share. those linked to local state and

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municipal governments such as fundamental structures of the Canal 13 in Yucatan and Tele- country, is a genuine milestone max in Sonora. in the field of Mexican television and telephony. The 1980s saw the creation by state and local governments of The reform seeks, for the first other regional television systems. time, to liberalise the sector so Until 2003 there had been 27 as to improve services, lower state media systems that were prices and increase competition founded to provide a platform to in the telephone and television showcase regional culture. Now, markets dominated by América “Given the trend as noted by Raúl Trejo Delabarre, Móvil, owned by Carlos Slim, and of ‘21st century researcher at the UNAM Institute Televisa, owned by businessman for Social Research (Mexico), “28 Emilio Azcárraga. We thus face socialism’, or leftist of the 32 states have television the possibility of substantial populist governments outlets that are run by local changes within the Mexican seeking more governments. There are a total of television market, dominated 253 frequencies. However, many of until now by the strong Televi- interventionist roles them broadcast at low wattage and sa-TV Azteca duopoly. in mass media, a do not entirely cover the entirety liberal’ alternative of the states in which they operate. The key focus of the reform is is offered” In contrast, private broadcasters the creation of two new national often have broader reach. For television stations by awarding example, in Oaxaca, one of the frequency bands that Televisa country’s poorest states, the local cannot apply for. Up to a 49% government TV has 52 channels. In share of TV networks may be un- Huajuapan de León, Oaxaca, the der the ownership of foreigners. state transmitter broadcasts at 700 Producers are also required to watts while Televisa’s transmitter offer their programs to all ca- does so at 36,000 watts.” ble TV companies, while forcing companies to broadcast cable Commitment to liberalisation and TV from all producers. It repre- openness sents a new opportunity for the Mexican population, which for Given the trend of “21st centu- the first time in history is able to ry socialism”, or leftist populist witness the democratisation of governments seeking more inter- Mexican audiovisual media. ventionist roles in mass media, a “liberal” alternative is offered 5. THE FUTURE: BROAD- for which Mexico offers a clear CAST, PAY AND DTT TELE- example in the government of VISION Enrique Peña Nieto.

The bill put before Congress The short-term future of and agreed with the opposition television in the region is as part of the Pact for Mexico, clearly linked to technological which he approved as the innovations. Pay television, in President of the Mexico with line with such technical changes the aim of modernising the and socioeconomic progress (the

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emergence of a middle class households, such as Argentina with consumption capacity), and Colombia, penetration is gaining importance at the growth was around 15%. In expense of general broadcast countries such as Brazil, Chile television. Yet at the same time and Mexico penetration growth it faces a challenge, that DTT may between 2008 and 2012 was 118% jeopardize its “reign” especially in Brazil, 83% in Chile and 38% in since the “digital switchover” will Mexico, according to data from take place over this decade. the Latin American Multichannel Advertising Council (LAMAC). Broadcast and pay TV “The dramatic growth There are also huge growth of pay TV has been At present there is a dual dy- prospects, particularly in the accompanied by new namic in the region: the dra- Brazilian and Mexican markets, matic growth of pay TV has been which in gross terms have the broadcast TV licenses” accompanied by the awarding of highest subscription rates, al- new broadcast TV licenses. though in relative terms they are surpassed by other countries in The Argentine government the region. thus expects to issue 90 - 300 new broadcast TV licenses. In The main reason for this growth Mexico the Governing Council of is that these two countries have the Pact for Mexico has agreed both the largest populations in to create two new broadcast TV the region as well as a growing stations and a third channel to middle class. Between 2000 and be operated by the state. 2010, middle class households and individuals went from com- In Colombia, after the tender prising 38.4% to 42.4% of Mexico’s process for a third private population, according to the Na- broadcast TV channel failed in tional Institute of Statistics and 2012, led by Grupo Planeta, in Geography (INEGI). In Brazil some 2013 the tendering process may 39.5 million Brazilians entered start for a third and maybe even the middle class between 2003 a fourth private channel with and 2011, according to a study national coverage. by the Getulio Vargas Foundation (FGV). A middle class with greater In parallel fashion, Cable TV is consumption capacity can devote undergoing spectacular growth more resources to recreation and in Latin America and accounts leisure activities where television for about USD $1.5 billion in plays an important role. turnover million per annum. The overall average penetration in These countries also become the the region is around 55%, having main area for development as TV increased steadily from 36% over companies can count on political the last five years (2008-2013). (legal security in Mexico and Brazil) In markets where pay TV has and social (growing middle class, more penetration and it is more some of it not vulnerable) scenarios established and habitual in that foster stable growth.

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“In those countries penetration Other markets are less power- growth has surpassed historical ful, but are also experiencing records. In the case of Mexico significant growth. penetration in the period from 2007 to 2012 increased from This is the case of Ecuador, 29% to 41%. Brazil, according to where the market for pay TV figures reported by IBOPE for reached 650,870 subscribers on eight cities, pay TV penetra- 31 January, 29.9% more than the tion in 2012 was 36.1%, which 500,893 subscribers registered on translates into an increase of the last day of 2012. Something 143% since 2007,” said Gary similar is happening in Uruguay, “We expect to see McBride, president and CEO of where Pay TV subscribers are an explosion in the Latin American Multichannel increasing by about 10% per year. Advertising Council. Mexico and Brazil in This growing trend of pay television the coming years” According to McBride, “We expect can be explained by several factors: to see an explosion in Mexico and Brazil in the coming years, and • Competition amongst cable that will contribute to the con- operators, which has enabled solidation of our business in these a “process of massification” countries. Looking at growth, we with new offers and more see a common phenomenon: the affordable payment options. fastest growing penetration rates are in the middle and lower so- • Social and economic im- cio-economic categories.” provement of the region, embodied by a new emerging Colombia, another country with middle class with increased a growing urban middle class, consumption capacity. has become the Latin American country with the highest level of The industry itself admits that pay television penetration with 2012 was very positive in terms of a presence in eight out of 10 Co- distribution owing to three factors: lombian households, according the growth of the “C class” in to the Latin American Multichan- Brazil, the consolidation of mature nel Advertising Council (LAMAC). Pay markets such as Argentina and the television in Colombia grew by strong performance of markets in 23% in the last five years, reach- Colombia, Peru and Chile. For all ing 84.4% of Colombians. these reasons, the region stands as one of the most attractive markets LAMAC data show Argentina in for the development of pay TV. second place, having led the region up to 2012, with 83% The future of pay TV penetration of households. Third is Chile with 60%, which between In the last five years, pay televi- 2012 and 2013 grew by 40%. Next sion has not only consolidated its come Peru (53%) and Venezuela position in Latin America but has (50%), followed by Mexico (44%) made a qualitative leap. For the and Brazil (40%). first time in history, more than

46 AUDIOVISUAL OVERVIEW OF LATIN AMERICA CONCENTRATION AND TECHNOLOGICAL RENEWAL

half of the region’s households Over the next few years, pay reported having pay TV in 2012, TV will undergo consolidation as shown below. throughout Latin America, where the vast majority of In the medium term, pay televi- countries will achieve penetra- sion will be characterised by two tion rates above 70%. Accord- features: impressive growth ing to the analysis by Dataxis, and increased concentration. the seven most significant pay TV markets in Latin America will have more than 67 million • Impressive growth customers in 2016.

Television will experience This Dataxis study indicates some interesting changes in that by 2016 Brazil, Mexico the next five years. Digital and Colombia will be Terrestrial Television and the the leading countries in advent of internet TV will the medium term. They, diversify supply and require along with Argentina, will pay TV operators to redefine constitute the four largest their business models. pay TV markets by customer volume with close to 90% of Although the television offer all subscribers. will undergo gradual changes, it seemsthat pay TV will • Increased concentration remain viable and even grow. This notion is corroborated by Dataxis also notes substan- the market intelligence con- tial business concentration sulting company Dataxis, which between 2006 and 2010. The specialises in Latin America. top 10 pay TV groups in the region accounted for 73.7% of subscribers in 2010, 10.5% higher than in 2006.

PENETRATION OF “PAY TV” TOTAL INDIVIDUALS, LATIN AMERICA (%) The two groups with the 70 62,5 highest rates of growth in 60,5 58,2 that period were DirecTV 60 and América Móvil, who were 50,9 first and second respectively. 50 44,8 41,8 39,2 DirecTV has been the leader 40 36,3 in this segment since 2007, supported by its main mar- 30 kets: Argentina, Brazil, Co- lombia, Venezuela, Chile 20 and Peru. However, Mexi- can tycoon Carlos Slim has 10 become the leading pay TV provider in Latin America, 0 2008 2009 2010 2011 2012 2013 2014 2015 Source: Data released by IBOPE in the Establishment Survey. Data for 2013, 2014 and 2015 are estimates by LAMAC.

47 AUDIOVISUAL OVERVIEW OF LATIN AMERICA CONCENTRATION AND TECHNOLOGICAL RENEWAL

and with services such as and powerful communicational “triple-play” took a leading groups that hegemonise the position in countries such as market for broadcast and pay TV Chile, Ecuador and Peru in have appeared in the region. 2010, Argentina and Mexico being exceptions. The Mexi- Furthermore, technological ad- can group América Móvil, has vances in communication will surpassed the American hold- further increase the diversi- ing company DirecTV as the fication and fragmentation of leading provider of subscrip- audiences due to access to infor- tion television services. mation via pay TV, internet tele- “Over the next vision channels, local community channels and those operated by few years, pay TV 6. CONCLUSIONS ethnic and social minorities. will undergo consolidation throughout The coming years will witness Specifically, two “revolutionary Latin America” major changes in the Latin changes” in the audiovisual field American audiovisual land- will prove significant in the medium scape. These changes will oc- term: the “digital switchover” cur in two ways that may seem (and the subsequent introduction contradictory even through they of DTT) and the rolling out of share parallel characteristics. “multi-play” technology.

On one hand, the process of The main challenge for Latin concentration will intensify America will be the “digital because large mega-corporations switchover”, which is already have long since followed this trend underway, even though Latin America is running somewhat TOP 5 LATIN AMERICA PAY TV - TV OPERATORS, H1 2012 behind Europe and the United States in this regard. At present, 12 in 2013, only one city in the region, Tijuana in Mexico, has ceased all analogue broadcasting 10 (May 2013). At the end of 2012 more than 12 million homes in Latin America had access to DTT,

8 i.e. almost 10% of households with television in Argentina, Brazil, Chile, Colombia, Mexico, Peru and Venezuela. 6 According to a study published by Dataxis, in 2016 “more 4 people in Latin America will watch DTT than analogue TV. In Pay TV Subscribers (millions) Pay addition, the study predicts that by 2017 DTT will be the main 2 television reception platform

0 América DirecTV Grupo Grupo Telefónica Móvil Televisa Clarín

Source: TeleGeography 48 AUDIOVISUAL OVERVIEW OF LATIN AMERICA CONCENTRATION AND TECHNOLOGICAL RENEWAL

for households that are not In the field of DTT, Latin America subscribed to a pay platform in has again demonstrated its Brazil, Argentina and Venezuela. characteristic heterogeneity by Among the countries that will opting for three alternatives as record the highest number of opposed to a single homogeneous households with access to DTT DTT system. in late 2017, Brazil was first with about 65% of the total for Latin Japan’s Integrated Services Digital America. Mexico, with 10.3% of Broadcasting standard (ISDB) households, will be in second was adopted by the Brazilian position while Argentina will be government in 2006, a move “The main challenge for positioned as the third largest which prompted other Mercosur Latin America will be the market with 8%.” countries (Argentina, Paraguay ‘digital switchover’” and Uruguay) to follow suit, Mexico’s analogue transmissions ruling out the European (DVB) must end no later than 31 De- and American (ATSC) standards cember 2015, the same date set that were adopted primarily by for Uruguay and the Dominican Re- countries most closely linked to public. Brazil, Paraguay and Co- the US (Mexico, Central America, lombia will do the same in 2016, except Guatemala and Nicaragua, while 2017 will be the year for and the Caribbean). Costa Rica, Panama and Chile; El Salvador and Ecuador will do so This heterogeneity, beyond in 2018, while in Argentina and illustrating Latin American Colombia it will come in 2019; peculiarities, will result in Peru, Bolivia and Venezuela serious problems when future will make the definitive switch attempts are made to make use in 2020, Honduras in 2021 and of communication synergies in Peru in 2014. the region and promote cultural, educational and television DTT will be a qualitative and integration due to the lack of quantitative change not only for compatibility between systems. television, but also for radio and This situation will promote other communication systems: isolation between countries and between the region’s two largest • Analogue TV represents an geographical areas (North and inefficient use of the spectrum South America). as it saturates the number of channels available in a The other challenge for Latin country. With DTT, a smaller America will be the “triple-play”, amount of the spectrum which will involve changing the being used makes it possible concept of media in general for more channels to exist. and television in particular (the provision of bundled voice, • Digital signals make higher internet, television, fixed and quality audio and HD video mobile phone services as well as possible. “Wi-Fi” wireless connectivity).

49 AUDIOVISUAL OVERVIEW OF LATIN AMERICA CONCENTRATION AND TECHNOLOGICAL RENEWAL

The logic is that Latin America is services) via computers, tablets or going through the same process as smartphones. Users will benefit Europe, where home triple-play from a more diversified array of has peaked and expanded into the offers and from more affordable field of mobile telephony through prices, but they will not always get the creation of content targeted better quality and service. to that medium. Internet Protocol television (IPTV) has the capability DTT offers more channels, with of offering video and multichannel better image quality and free, television content, with image but its emergence comes at a quality similar to that of DVDs. time when there are other technologies that offer more features, In the medium term, the world particularly internet television, of television in Latin America will which embodies an alternative experience a profound transforma- offering a la carte television and tion: the development and compe- video on demand that enables the tition between digital, satellite and broadcast of digital content. multi-play TV which will diversify the media through which one can This duel between the DTT and view television content (triple-play multi-play will give rise to the new with Pay TV, telephone and internet audiovisual map of Latin America.

Source: Media Telecom

50 Overview of Latin American press The pre-Internet boom

Madrid, october 2013 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

1. INTRODUCTION 1.INTRODUCTION 2. WHAT DO PEOPLE READ IN LATIN AMERICA? Latin American press is currently thriving —growth in readers, advertising and circulation in most countries—, contrasting with the 3. GROWTH IN READERS crisis in other parts of the world, especially Europe and the USA. 4. CONSOLIDATION OF THE PUBLISHING GROUPS There are media more suited to the emerging social sectors —the 5. FUTURE OUTLOOK: LOSS OF lower middle classes— in content and price, alongside newspapers READERS AND DIGITAL CHALLENGE focusing on the interests of the higher social strata and the professional middle classes.

These are times of general prosperity throughout the region, although there are already hints of the challenges that will appear in the near future and which have commenced in some countries such as Argentina: falling numbers of readers, sales and advertising as those readers shift from printed press to the digital press on Internet.

This report analyses the following points:

• The current situation of the printed press in Latin America, referring to the number of readers, characteristics, trends and degree of business concentration.

• The short-term challenges facing the printed media as Internet advances.

We shall try to explain first of all what people read in Latin America, why the number of people reading printed press is growing in most of these countries, the business structure in the media of this region and, finally, the future outlook for printed press in Latin America.

33 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

2. WHAT DO PEOPLE READ and education. One of their IN LATIN AMERICA? characteristic features is that they present the contents One of the characteristic features in a clear, direct language, of the printed press in Latin often using jargon, bearing in America is its variety and widely mind their target public in the differing target publics with a broad middle-middle and low-middle spectrum of cultural education and classes. The front page is social levels, which in turn leads to colourful with large headlines, “The Popular Press a diversity of contents and forms containing news on crime & is, together with the of presentation. accidents, entertainment and free press, behind the show business. current surge Some 5 types of daily newspapers • The Regional Press is very of readers” can be distinguished in the region: the traditional press, popular important in the largest and press, regional press, specialist most decentralised countries, press and free press. since the major cities in the interior have enough critical • The Traditional Press is what is mass and volume of population, known as “the serious press”, especially in the working-class including large, long-standing districts, to maintain well- benchmark newspapers such established printed media as La Nación and Clarín in with large circulation. That is Argentina, El Mercurio in Chile, the case of countries such as El Comercio in Peru, O Estado in Mexico, Venezuela, Colombia, Brazil or El Tiempo in Colombia, Brazil and Argentina. In along with others that have Ecuador, Quito and Guayaquil appeared on the scene during are the two poles where the the last half a century, such principal media are developed, as Reforma in Mexico, Prensa which actually operate as Libre in Guatemala or La national press. In contrast, Tercera in Chile. there is a large dispersion in countries such as Bolivia with • The Popular Press is, together small, provincial circulations. with the free press, behind the current surge of readers • The Specialist Press embraces and exists throughout the a large number of media, but entire region, from Mexico and two large categories stand out, Guatemala, through Peru and those dedicated to economic Brazil, to Argentina and Chile. information, addressed at a minority but with a high These newspapers are cheaper purchasing power, and sports and offer everyday, local press, which is much more news on the subjects and massive and popular. In areas of most interest for the fact in some countries, like working class and emerging Mexico, Peru and Venezuela, middle class: public services, the sports press is among the the health service, safety most widely read.

34 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

In the more socially and 7 in Mexico, these countries economically developed leading this new form of countries the economic press—. The most prominent media, although minority, are free newspaper is the Metro highly influential, as is the International —“Metro”—, case of Ámbito Financiero the largest newspaper in and El Cronista Comercial in Latin America, with almost Argentina —with 74,000 and 3 million daily readers in the 58,000 copies a day—, Valor in metropolitan areas of Mexico, “What can be observed Brazil, and El Financiero and Brazil, Chile, Ecuador, Peru, throughout the region is El Economista in Mexico with Guatemala and Colombia. a competition between 98,000 and 38,000 copies each. ‘serious’ media and What can be observed throughout popular press” In this regard, certain weekly the region is a competition magazines have a huge impact between “serious” media and are very important, and popular press. According such as Veja in Brazil with a to SkyScraper Life, a forum of circulation of over 1 million multimedia information resources, copies, Qué Pasa and Capital which published the report “The in Chile, Brecha and Búsqueda 200 daily newspapers most widely in Uruguay, Semana in read in Latin America: average Colombia, Letras Libres and daily circulation in 2011”, the Nexos in Mexico and Caretas most read newspaper in the region in Peru. is the popular Peruvian newspaper Trome, followed in second place by • In recent years, since the Clarín in Buenos Aires with 348,239 late nineties, the free press a day; third was the popular Super has also developed with Noticia in Belo Horizonte with great success. 293,572; fourth Folha in São Paulo with 286,398; and fifth, another As pointed out by the popular newspaper, Nuestro Diario specialist in free press, Piet in Guatemala City with 270,097. Bakker, from Amsterdam University, this type of The first ten places are completed newspaper is the most recent with El Tiempo in Bogotá —6th with phenomenon in the world of 269,394—, Extra in Río de Janeiro printed press. Its circulation —7th with 265,018—, O Estado in grew by 140% from 1.2 million São Paulo —8th with 263,046—, O in 2005 to 2.8 million in 2010, Globo in Río de Janeiro —9th with reaching a total of 3.5 million 256,259— and La Prensa in Mexico newspapers distributed in City —10th with 244,299—. 2011 —a penetration of 1 newspaper for every 100 As may be observed in this inhabitants—. The number of classification, the popular free newspapers in the region newspapers —Trome, Super rose from just two in 1999 to Noticia, Nuestro Diario, Extra and 40 and currently stands at 37 La Prensa— and the traditional —8 in Argentina, 8 in Brazil and ones —Clarín, Folha, O Estado,

35 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

O Globo and El Tiempo— the markets are traditional and predominate on the market. popular press, with a few specific cases where specialist press Analysing the situation country is more important, especially by country, we observe that the sports newspapers, and even printed media predominating on regional press:

COUNTRY MEANS SALES TYPE COUNTRY MEANS SALES TYPE

Clarín 348,000 traditional press HONDURAS La Prensa 60,000 traditional press La Nación 162,000 traditional press Diario Popular 96,000 popular press La Voz del Interior regional daily La Prensa 244,000 popular press ARGENTINA 55,028 La Gaceta–Tucumán 53,925 regional daily El Gráfico 235,000 popular press Dario Deportivo Ole 49,625 sports daily El Norte 232,000 regional press La Capital–Rosario 39,175 regional daily El Informador 190,000 regional press El Día–La Plata 38,362 regional daily Record 180,000 specialist press Ovaciones 158,000 specialist press MEXICO Reforma 135,000 traditional press Extra 80,000 popular press La Jornada 107,000 traditional press Gente 78,000 popular press BOLIVIA El Economista 98,000 specialist press El Diario 45,000 traditional press El Universal 81,000 traditional press El Deber 28,000 traditional press Milenio 80,000 traditional press Excelsior 25,000 traditional press Folha 297,000 traditional press popular press Super Noticia 296,000 NICARAGUA La Prensa 42,000 traditional press Extra 265,000 popular press BRAZIL O Estado 263,000 traditional press traditional press El Siglo 66,000 popular press O Globo 256,000 PANAMA Zero Hora 188,000 popular press La Prensa 65,000 traditional press

Últimas Noticias 39,000 traditional press El Mercurio 161,000 traditional press PARAGUAY Últimas Noticias 124,000 popular press ABC Color 39,000 traditional press CHILE La Cuarta 107,000 popular press La Tercera 98,000 traditional press Trome 560,000 popular press La Segunda 133,000 traditional press El Popular 215,000 popular press Correo 161,000 popular press Nuevo Ojo 151,000 popular press El Tiempo 269,000 traditional press PERU Líbero 106,000 sports daily Q’Hubo Medellín 121,000 popular press COLOMBIA El Comercio 100,000 traditional press El Espectador 58,000 traditional press Perú 21 100,000 traditional press El Espacio 48,000 popular press La República 50,000 traditional press

Diario Extra 169,000 popular press COSTA RICA Listín Digital 66,000 traditional press La Nación 65,000 traditional press DOMINICAN Hoy 50,000 traditional press REPUBLIC Caribe 28,000 traditional press El Universo 135,000 traditional press El Nacional 28,000 traditional press ECUADOR El Comercio 120,000 traditional press Últimas Noticias 69,000 popular press El País 65,000 traditional press Extra 69,000 popular press URUGUAY La República 38,000 traditional press

El Salvador Diario Hoy 57,000 traditional press Últimas Noticias 170,000 popular press Meridiano 150,000 sports daily Panorama 101,000 regional press Nuevo Diario 270,000 popular press VENEZUELA Líder 100,000 sports daily Prensa Libre 130,000 traditional press GUATEMALA El Nacional 90,000 traditional press El Periódico 30,000 traditional press El Universal 82,000 traditional press Siglo XXI 30,000 traditional press

Source: Author’s preparation based on figures from SkyScraper Life (average daily circulation in number of copies sold in 2011)

36 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

As can be seen in this table, Bolivia the most-read media are the competition between the popular press such as Extra benchmark traditional press and Gente, which double the and popular press is clearer circulation of El Diario in La Paz in Brazil than anywhere else. and El Deber in Santa Cruz. The daily newspaper Folha in São Paulo and the popular The situation is similar in newspaper Super Noticia vie Guatemala, albeit on a smaller with each other every year for scale owing to the size of the “In contrast to the the largest number of sales. country: the undisputed leader situation in Europe and Moreover, the six newspapers is the popular Nuestro Diario USA, in most of the Latin with the highest sales are —270,000 copies—, way ahead American countries, the popular daily newspapers of the traditional newspapers excluding cases such as Super Noticia, Extra and Zero such as Prensa Libre —130,000— Hora, and the traditional daily , El Periódico —30,000— or Argentina or Chile, the newspapers Folha, O Globo and Siglo XXI. Similarly, in Costa number of people who O Estado. Rica Diario Extra, a popular read printed press newspaper, sells 100,000 copies is growing” In Peru, however, the more than La Nación, the predominance corresponds benchmark daily newspaper in to popular press: Trome is the country. undisputed regional leader with 560,000 copies, followed In Argentina, Chile, Colombia at a considerable distance by and Ecuador the traditional press another daily newspaper of the is most widely read, although same type, El Popular. the popular press also have a strong presence on the market. The Mexican market is dominated The principal newspapers in by the popular press —La Argentina are Clarín and La Prensa—, the sports papers — Nación; in Ecuador, El Universo Récord and Ovaciones— and the and El Comercio; in Chile, El regional newspapers —El Norte Mercurio; and in Colombia, El de Monterrey and El Informador Tiempo. But these newspapers de Guadalajara—. The major are followed very closely by traditional newspapers follow the popular newspapers —Las in fourth place —Reforma, La Últimas Noticias and La Cuarta Jornada, El Universal, Milenio in Chile, Últimas Noticias in and Excelsior—. Ecuador, Q´Hubo, with its corresponding local editions, in Along the same lines, in Colombia and the weakest of all, Venezuela the popular press Diario Popular in Argentina—. —Últimas Noticias—, regional press —Panorama— and sports press —Meridiano and Líder— 3. GROWTH IN READERS top the list of most-sold daily newspapers, outstripping the In contrast to the situation traditional serious press —El in Europe and USA, in most of Nacional and El Universal—. In the Latin American countries,

37 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

excluding cases such as extending throughout the Argentina or Chile, the number entire continent. of people who read printed press is growing. From a ratio As pointed out by Piet Bakker, of 6.2 newspapers per 100 journalist and academician at the people in 2002, it rose to 6.7 University of Utrecht and expert per 100 people in 2010 while in the worldwide phenomenon the circulation increased by of free press, free newspapers 15%, according to figures will not replace paid papers, “The improvement in published by the consultancy but reach a supplementary type the economic situation in PricewaterhouseCoopers (PwC). of reader: “The main reason for the region has brought a the low level of substitution higher level of resources PwC forecasts a growth of the seems to be that free dailies and increased purchasing daily newspaper business in target not only new readers but Latin America by around 5.5% also a different sort of reader. power of the population, per annum over the next five Free papers are usually also especially the emerging years, which contrasts with the quite successful in finding that middle classes” 1.4% p.a. drop forecast in North particular reader. As they aim for America over the same period, a —preferably urban younger— or the growth of just 0.3% in non reading audience, existing Europe and the Middle East. titles don’t have so much to fear from free dailies. At the same There are several reasons for this time there are many people who growth, which is underpinned read both paid and free dailies, by the rise of popular and free which also suggests a low level press and goes against the of substitution.” global trend: As shown in the graph “Countries, • Firstly, the improvement titles, editions and circulation of in the economic situation free newspapers in Latin America”, in the region has brought circulations has doubled between a higher level of resources 2005 and 2011. and increased purchasing power of the population, This is a global phenomenon especially the emerging which has extended throughout middle classes, the main the region. Some of the most niche of readers of the popular titles are La Razón popular press. in Buenos Aires; El Día in Bolivia; Sao Paolo Metro, • Secondly, the consumption of Greater São Paulo, Santos, free press has also grown. The Campinas, Rio de Janeiro, “Metro” phenomenon began in Curitiba, Belo Horizonte and Stockholm in 1995 and reached Destak in Sao Paolo, Rio de Latin America in 2009 when Janeiro and Brasilia; and in this type of dailies appeared in Chile, Publimetro and La Hora Ecuador, Colombia, Guatemala in Santiago, Viña del Mar, and Peru, subsequently Valparaíso and Rancagua.

38 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

In Colombia, ADN in Bogotá, 4. CONSOLIDATION OF THE Medellín, Barranquilla, Cali; PUBLISHING GROUPS Al Día and Diario Libre in the Dominican Republic; Metrohoy, There are large communication Metroquil and MetroCuenca groups behind the major in Ecuador; Publinews in printed press in the region. Guatemala; Publimetro in These major corporations have Peru; Primera Hora and Ciudad the largest circulation, largest in Venezuela. numbers of readers and largest “There are large advertising portfolios. communication groups In Mexico we can find El M behind the major in Mexico City, in circulation In Brazil, the most important printed press in from 2000 to 2007; El Tren in paper, O Globo, is owned the region” Guadalajara, created in 2000; El by InfoGlobo of the Marinho Nuevo Siglo, 2004-2010; El Tren in Group, a media conglomerate Monterrey (2005); Crónica Síntesis with holdings in radio, press (2006-2010); Publimetro, with and television. The other major editions in Mexico City, Monterrey group has been developed around and Guadalajara (2006); Más Folha, related to the Frías por Más in Mexico City (2009); family, which publishes the Folha PuntoMedio in Mérida (2009); de São Paulo, Agora and Valor El Nuevo Mexicano in Federal Económico. Other prominent District (2010) and 24horas with a groups are the RBS Group in Rio national circulation (2011). Grande do Sul with 4 newspapers,

COUNTRIES, TITLES, EDITIONS AND CIRCULATION OF FREE NEWSPAPERS IN LATIN AMERICA, 1999-2011

60 4000

Countries Titles 3500 50 Editions Circulation 3000

40 2500 Circulation

30 2000

1500 20

Countries, titles and editions 1000

10 500

0 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Source: Piet Bakker: “The rise of free daily newspapers in Latin America”, at http://udep.edu.pe/comunicacion/ rcom/pdf/2012/Art129-149.pdf 39 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

including its flagship Zona Zero, established, so they invest in the and the Estado Group with O media because this gives them Estado de São Paulo. symbolic power, which in turn underpins their economic power In Mexico, the following groups are and they thus increase their prominent: El Universal Group, influence in the sphere of politics Image Group ―owned by Olegario and also their profitability.” Vázquez Raña, which controls Excelsior newspaper―, and In Argentina, the Clarín Group “In Argentina, the Clarín Organización Editorial Mexicana ― owns the daily newspaper Group owns the daily which is controlled by Mario Clarín, which was for many years newspaper Clarín, which Vázquez Raña, bringing together the most widely read Spanish- was for many years the some 70 printed media―. Then language newspaper in the most widely read Spanish- there are important local groups, world. La Nación, apart from the such as La Jornada in Mexico newspaper of the same name, language newspaper in Federal District, and Reforma also owns the local licences the world” and Milenio in Monterrey, Federal of publications such as Rolling District and Guadalajara. Stone, ¡Hola! and OHLALÁ.

In Colombia, the Santo Domingo In Chile there are three major Group controls radio and TV groups: El Mercurio, Copesa and Caracol, the daily El Espectador the Claro Group. in Bogota and prominent magazines such as Semana and El Mercurio is the largest Cromos. Furthermore, in 2012 the journalistic company with more Organisation of the Colombian than 20 national and regional entrepreneur Luis Carlos newspapers, including El Mercurio Sarmiento Angulo (OLCSAL) de Valparaíso, El Mercurio de purchased 55% of the shares in Santiago, Las Últimas Noticias, Casa Editorial El Tiempo from El Mercurio de Antofagasta, La the Spanish Planeta Group. This Estrella de Valparaíso, El Líder firm also publishes the economic de San Antonio and La Prensa specialist daily Portafolio and de Tocopilla. ten magazines. The Copesa Group controls several Juan Carlos Gómez, researcher names in radio, television and from the media observatory at Internet, as well as press, including La Sabana University, points out Pulso, La Tercera, La Hora, La that the interest observed in Cuarta, El Diario de Concepción, the past relationship between the magazine Qué Pasa, Paula, entrepreneurs and that sector BizHoy, Biut, Agrupémonos, Zoom of the press is linked with the Inmobiliario, Zoom Automotriz, “possibility of increasing their Promo Service and the radio sphere of influence and power”: stations Zero 97.2 and Duna 89.7, “Large economic investors among others. need backing to increase the influence they can bear on Finally, the Claro Group, named the societies in which they are after the entrepreneur Ricardo

40 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

Claro, is behind Ediciones long-standing titles, they Financieras S.A., which owns have also put popular and Diario Financiero. The group also free newspapers on the owns Ediciones e Impresos S.A., market. This is the case of which publishes Revista Capital. Clarín with the popular daily Muy, El Tiempo with Hoy and In Bolivia, the Rivero family Copesa in Chile with La Hora owns the benchmark daily El (created in 2000). Deber and controls Periodistas “All these processes are Asociados Televisivos, nine The media conglomerate that occurring in a context of dailies in La Paz, Cochabamba publishes O Globo, the largest modernisation of what and Potosí, two radio stations paper in Río de Janeiro, were formerly companies and two television channels. launched its own tabloid, that had been owned for Extra, sold at 65 cents, while In Peru, the El Comercio Group O Globo was sold at US$ 1.15. generations by families owned by the Miró Quesada Following the launching of dedicated to journalism” family is the principal media Extra by Infoglobo, the RBS group in the country, with Group, a media conglomerate daily newspapers such as El from Porto Alegre, launched Comercio, Gestión, Peru.21 and Diário Gaúcho in 1998. Trome, along with its interest in television, through Grupo Plural The traditional media have TV, owner of Canal N and América also entered the free press TV, in which the La República business: Clarín took over La Group is a minority shareholder. Razón in 2000; Diario Hoy in Ecuador launched Metrohoy, In Venezuela, the largest two Metroquil and MetroCuenca, newspapers, El Nacional and the Copesa Group in Chile El Universal, are owned by the brought out La Hora; El Otero Silva and Mata families, Comercio in Peru is behind respectively. Publimetro; the Planeta Group, which owns the daily All these processes are occurring El Tiempo, promotes ADN in in a context of modernisation of Bogotá, Medellín, Cali and what were formerly companies Barranquilla; El Nacional that had been owned for in the Dominican Republic generations by families launched Última Hora; El dedicated to journalism. Those Día in Bolivia launched El families have now formed Sol; and El M was published business units which are run in Mexico by El Universal. using modern administrative and managerial methods. • Segmentation of the journalistic market —through specialist, For the time being, these groups sports, popular and free press— have opted for a triple strategy: as an option to focus on readers’ needs, make the press more • Diversification: while attractive and start publishing continuing to publish their brief, more local news.

41 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

• Positioning in Internet, Although the number of since, as highlighted by digital readers is rising in some Latin press researchers Summer American countries —the most Harlow and Ingrid Bachmann: representative being Peru,where “A solution is sought in sales have grown by 55% in the Internet to the problems last 5 years from 1.2 million encountered as a result of copies sold to 1.8 million, the falling circulation and according to figures published smaller advertising income by KPMG—, the socially more “The circulation of of the press —Paterson and mature countries such as Brazil, printed newspapers Domingo, 2008—. However, Argentina, Colombia and Chile, grew by 0.1% in 2012 a recent report showed that with historically consolidated in Latin America” 20% of the digital journalism middle classes, are already in a initiatives in Latin America very different situation as reading do not make a profit — on Internet is rising steadily. That Fundación Nuevo Periodismo is the way Latin American press Iberoamericano, 2011—.” will go in the coming years.

By all accounts, as the middle 5. FUTURE OUTLOOK: classes in Peru and other countries LOSS OF READERS AND in the region become consolidated, DIGITAL CHALLENGE gain more purchasing power and start entering the world of Internet, The medium-term future of the the number of people who read Latin American printed press, newspapers online will rise. in around five years’ time, will be hit by (a) a loss of printed However, at least for the next press readers through migration few years, it looks more as if to Internet and, as a direct the different formats will be consequence of this, (b) the complementary, rather than boom in electronic media. some immediately substituting others, as highlighted by Juliana Loss of printed press readers Sawaia, Manager of Learning & Insights at Ibope Brazil. Broadly speaking and according According to this researcher, to the annual survey of World we are in the “tradigital” era Press Trends published by the in Latin America, in which the World Association of Newspapers penetration of electronic and News Publishers, the devices on the market leads to circulation of printed newspapers a diversification of multiple grew by 0.1% in 2012 in Latin formats for the distribution America —1.2% in Asia and 3.5% of contents and information, in Australia and New Zealand—, but where digital media now contrasting with a fall by 6.6% form part of the strategy in North America, 5.3% in West of traditional media and, Europe, 8.2% in East Europe as such, complement them, and 1.4% in the Middle East and promoting the consumption of North Africa. media in general.

42 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

In fact, it must be borne in the penetration of Internet mind that the numbers of Latin has grown in the region and American online readers have is now over 50% in 4 countries “Whether complementary grown more than anywhere —Argentina, Chile, Uruguay or substituting the reading else in the world: 12% between and Colombia—, as shown in of printed press, there March 2012 and March 2013 — the graph, and over or around is a clear trend towards according to the annual analysis 40% in 8 countries —Costa increasing readership of made by the firm Pingdom Rica, Panama, Dominican and a report by ComScore—. Republic, Venezuela, Brazil digital press” In total there are almost 160 and Peru—. million netsurfers in the region, which puts Latin America in • Moreover, the infrastructures the forefront in the growth of are improving with a rise Internet users. It is followed by in broadband connections. the Asia-Pacific region with a 7% There is still considerable growth; Europe, with 5%; Middle room for growth in this aspect East-Africa with 3% then the because, as can be seen in the United States and Canada with following graph, despite having 1%. Yet in spite of the growth of increased by 20% in 3 years it is the Latin American audience, it still at 27%:. still only represents 9% of the global Internet audience. The digital challenge

Whether complementary or “The arrival of Internet”, as substituting the reading of pointed out by the editor-in-chief printed press, there is a clear of El País, Juan Luis Cebrián, trend towards increasing “is not a mere change in social readership of digital press: attitudes. It is a revolution of society and civilization on a par, • Because the number of in the history of mankind, with consumers is rising. In fact, the invention of the alphabet or

PENETRATION OF THE BROADBAND IN LATIN AMERICA (%)

0 Argentina Chile Uruguay Colombia Costa Panama Puerto Dominican Venezuela Brazil Mexico Peru Ecuador Paraguay El Bolivia Guatemala Cuba Honduras Nicaragua Rica Rico Republic Salvador Source: Latinoaméricalatinahoy

43 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

printing. And journalism is right new package, which changed the in the thick of things.” audience’s behaviour again. Some websites now discover that 30% of Along the same lines, Francisco their entries come from Facebook, Miró Quesada, editor-in-chief of i.e. through the recommendation the Peruvian daily El Comercio, of a friend”, as pointed out by said during a meeting of the Latin Jean-François Fogel, a French American Society of Journalism journalist expert in digital media, (Sociedad Iberoamericana de who ran Le Monde.com and was “We can conclude Periodismo) that “Latin American adviser to Grupo Prisa. that access to Internet press is still enjoying a good changes reading habits” springtime, but it must not rest on Therefore, after two decades its laurels.” of development and due to the latest technological progress, Over the past 20 years, the digital we can conclude that access to press has been through three Internet changes reading habits. stages. A first stage in which its As Fogel also mentioned: “I might contents were put online just like be wrong, but I have a feeling that any other distribution channel. the appearance of smartphones A second stage when Google is going to have a tremendous appeared on the scene in 1998 and impact in Latin America. In recent completely changed the behaviour decades, families living in the of the audience. And a third stage, poor, outlying areas of the large the current stage, marked by “the cities in Latin America who did appearance of social networking not have a house of their own (Facebook, Twitter), cell phones often had a television. That was a —mobility breakthrough— and way of feeling that they belonged YouTube; suddenly word gave to society. Well the same families way to image. All this made up a now have a cell phone. They will use that cell phone as a small computer and enter the digital PENETRATION OF THE BROADBAND IN LATIN AMERICA (%) world through that channel, rather than buying a tablet or a 30 computer, which are priced out of their reach.” 25 In this situation and apart from 20 certain exceptions, such as the daily newspaper Clarín, El Tiempo, La Tercera or Folha 15 in São Paulo, the digital daily of the El Comercio Group and 10 La Prensa in Peru, the printed press has not yet managed to 5 adapt to the new digital media. Bernardo Díaz Nosty, professor 0 at Malaga University specialising 2008 2009 2010 2011 2012 2013 in press, stressed that “within Source: Wireless Intelligence

44 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

the vast presence on Internet obtained in studies on the media of all kinds of daily newspapers of other western countries from Latin America, the editions —e.g. Hermida and Thurman, were essentially symbolic, 2008; Jönsson and Örnebring, with very little value added 2011—, which suggest that the in relation to the possibilities editorial staff still control what offered by the digital support news is published and how. The and falling far short of the codes potential for a greater inclusion of construction, legibility and of audience in the information design characterising the more process and more collaborative highly developed digital press. journalism is curtailed by “The potential for interactivity localised in the a greater inclusion Ingrid Bachmann and Summer hierarchy of the media. As of audience in the Harlow —the authors of a mentioned by Kim and Sawhney information process study on Latin American press (2002), users have little room and more collaborative on Internet—maintain that for reaction and the producers of journalism is curtailed by “the publication of contents contents make sure they hang on on Internet follows the logic to the decision-making powers.” interactivity localised in of duplication and migration the hierarchy of rather than adopting new All these processes —improvement the media” formats and when multimedia of the economic situation of the resources are used, it is for population with access to other, topics that lend themselves to more sophisticated and expensive this type of treatment. communication instruments and the “technological revolution”— Accordingly, the sections on will eventually encourage culture, entertainment and readers to migrate from printed sports include considerably more press to digital press. Moreover, photographs, image galleries the anticipated reduction of and videos than the rest, while readers will go hand-in-hand with the inclusion of audio clips is a reduction of advertising, since significantly more frequent in Internet has already begun to articles on politics, police & attract income from advertising. crime and education, especially Its share of all media advertising for witness declarations. Once rose from 1.6% in 2004 to 4.2% in again, the results suggest the first half of 2010, according that the media opt to use the to the Projeto Inter-Meios, web elements that are easiest which monitors expenditure to incorporate and do not in advertising. This increase especially alter the process of contrasts with the income from producing news… general advertising, which dropped from 16.6% to 13.4% According to our analysis of 19 over the same period. websites of the most emblematic Latin American newspapers, There is now even a rich, they offer a limited opening new experience in Latin to dialogue with users. These America regarding digital results are similar to those informative media. Some

45 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

twenty news websites have Internet is non-existent in Latin been developed which operate America. To quote the assistant as digital journalistic media. editor-in-chief of the Argentinian These include Plaza Pública in daily La Nación, Fernán Saguier: Guatemala —two-third financed “Online websites represent a very by the University Rafael small percentage of the business: Landívar—, Animal Político and between 5 and 7 per cent.” Reporte Índigo in Mexico, El Faro in El Salvador, Confidencial —a There are several alternatives for “Payment for contents is portal in Nicaragua directed by the future development of the proposed as a very long- Carlos Fernando Chamorro—, different formats —traditional term alternative, since Verdad Abierta and La Silla Vacía press and the press arising in the that culture of paying in Colombia, Ciperchile in Chile, digital world—: for reading the press on Puercoespín and Chequeando in Argentina, Apublica in Brazil and • The segmentation and even Internet is non-existent IDL-Reporteros and Infos in Peru. hyper-segmentation of content, in Latin America” adapting to each user and However, the growth in digital endeavouring not to broadcast platforms is not being followed to an undetermined mass of by a parallel growth in advertising readers, but to each Internet income, so the printed dailies user in particular. “Therefore, will foreseeably not be able to it is not a collective message offset with Internet the loss of to be consumed on equal advertising income in their printed terms by a mass of receivers. editions or the drop in sales. On the contrary, it is a specific offer which each user will PwC says that advertising in choose individually to adopt the online editions of the Latin his decision-making or enrich American dailies will grow by his particular data bank”, 23.5% until 2016, three times assures Tatiana Hernández more than in the printed versions, Soto in her doctoral thesis: but with a much smaller cost of “Evolution of the principal advertising on Internet. general information digital newspapers in Latin The Achilles heel of online media America from the beginning is their inability to finance of the third millennium themselves, since the vast (2000-2007). The cases of majority have financial problems. Argentina, Chile, Colombia, According to a study published Mexico and Venezuela.” by the FNPI —Foundation of New Latin American Journalism— made • PCommitment to and further by Angel Alayón, 57% generate development of the use of the losses. Only 18.5% declared that tools available in the digital they had generated more income world, such as hypertext, the than costs. Payment for contents multimedia option, bonding is proposed as a very long-term together text, fixed image — alternative, since that culture of infographics—, sound —voice, paying for reading the press on music, special effects—,

46 OVERVIEW OF LATIN AMERICAN PRESS THE PRE-INTERNET BOOM

moving image —animation, Its secret lies in offering videos— and interactivity an enormous amount of between the transmitter and localism, with editions the receiver. adapted to each segment. That formula is repeated As Tatiana Soto points in Colombia through the out: “The digital design is newspaper alliance Grupo still faced with a number Nacional de Medios (GNM), of technical limitations. which founded the popular “The ground already The ground already daily Q’Hubo. covered by the websites covered by the websites of some traditional Latin of some traditional Latin • Another development vector American newspapers American newspapers is must be to take advantage is a good starting point, a good starting point, of the synergies among me- but there’s still a long dia in the region that share but there’s still a long way to go. New expertise the same language. way to go” needs to be introduced. It is unarguably necessary According to Díaz Nosty: to make further progress in “the supranational poten- the interdisciplinary work of tial of the benchmark press journalists, editors, designers, in a cultural space where photographers, infographic there are barely any lin- designers, etc., as well as in guistic barriers is extraordi- the executive vision of this nary, but for the time being new challenge for journalism. communication permeabil- In short, newspapers need ity is very low, so the me- to assess and understand dia frontiers coincide with the real repercussions of the the national geographic new platform.” boundaries. There is no con- spicuous experience of col- • One possible solution that laboration among publishing is being tried and tested companies or supranational to cope with the falling projects. The first supple- numbers of printed press ment distributed simultane- readers is the idea of ously by daily newspapers of focusing on the development different nations stemmed of content as a “formula for from a North American ex- survival” and to attract more perience, of the New York readers. There are already Times. Perhaps the most experiments along these advanced initiative may lines, such as the newspaper arise from Grupo de Dia- Zero Hora, which has 19 rios América, which has sections, daily theme-based 11 newspapers in 11 Latin supplements and content American nations with a especially targeting young circulation of 1.5 million people —53% of its readers copies a day, which share are less than 40 years old—. and offer joint resources.”

47 The Latin American radio panorama The future of radio in Latin America: a new revival

Madrid, december 2013 THE LATIN AMERICAN RADIO PANORAMA THE FUTURE OF RADIO IN LATIN AMERICA: A NEW REVIVAL

1. INTRODUCTION 1. INTRODUCTION 2. THE RADIO SECTOR IN LATIN AMERICA Radio in Latin America, as in other parts of the world, is about to have 3. WHAT DO PEOPLE IN LATIN a second wind, thanks to the application of new technologies to the AMERICAN COUNTRIES LISTEN TO? medium of radio. First heard in the 1920s, radio reigned unopposed until the 1950s and 1960s when television was introduced. 4. BUSINESS GROUPS 5. DIVERSIFICATION OF SUPPLY The audiovisual world dethroned radio but did not lead to its 6. CONCLUSION: THE FUTURE OF disappearance or extinction, as some predicted. It survived thanks RADIO BROADCASTING to its greater closeness to the consumers (listeners) and its greater immediacy and flexibility, but it clearly lost prominence as a means of mass communication.

However, in this second decade of the 21st century, the Internet and the new "a la carte" communication methods may lead to a radio revival. In addition, the large number of stations has made radio in Latin America more heterogeneous and flexible, adapting to the political, social, religious and ethnic needs of the listeners.

In this report we will uncover the state of radio broadcasting in Latin America today (what is listened to and who listens to it) and look at the future prospects for this medium.

Specifically, we will look in more detail at the following aspects: the state of radio broadcasting in Latin America today, the fragmentation of audiences, the heterogeneity of supply, the consolidation of the large media groups and the outlook for this medium.

68 THE LATIN AMERICAN RADIO PANORAMA THE FUTURE OF RADIO IN LATIN AMERICA: A NEW REVIVAL

2. THE RADIO SECTOR IN study carried out by Reputation LATIN AMERICA Institute and Inmark Perú.

The radio sector in Latin America Great ability to adapt has two virtues that put it in a very good place to keep consolidating One of the real historical virtues its position: of this medium is its great ability to adapt to new times and to It enjoys prestige among the changes, thanks to being more "Radio is, and will remain population as a whole and the flexible. It found an alternative for a long time, the listeners in particular. role to television when television means of communication first appeared (appealing to its par excellence in Latin Radio continues to be very important greater immediacy) and it has done America" in Latin America. Reports by so again with the arrival of the Latinobarómetro1 normally suggest Internet (underlining its closeness that it is the trusted medium for to the listener). much of the population, with a 55% approval rating. Radio offers people As argued by Marta Garrido and company and entertainment, and Laura Pinto in an article in Radio for many it is currently the only Netherland “the new technologies, medium for finding out what is far from having supplanted radio, happening in their country. have made it more universal. Radio is merging with the Internet and This prestige is even more is adapting to the social media. pronounced for the stations Despite there being an increasing broadcasting in FM than it is number of people with access to for those operating in AM, as the Internet, its use is still limited highlighted by the radio specialist in Latin America since only 27% Tito Ballesteros who concluded that of people have Internet access. “AM is becoming less valued and In any case, radio is, and will FM more listened to. The findings remain for a long time, the means of the study support this argument: of communication par excellence there are 6,892 AM stations in Latin in Latin America. Although it has America and 13,394 FM stations.” changed its format along the way to adapt to new times, its essence An example of this prestige and remains intact.” trust can be seen in Peru, where it is worth discussing the case of This ability to adapt has increased Radio Programas del Perú (RPP), over recent times, with changes to since it is not only the means of the entire process involved in radio communication with the best broadcasting: in the different reputation in the country, but areas of production, broadcasting, also the only medium in the Top reception and interaction between 10 of RepTrak Pulse Perú 2012, a the transmitter and the receiver.

1 Latinobarómetro is an opinion poll that each year carries out around 20,000 inter- views in 18 Latin American countries representing more than 600 million inhabitants.

69 THE LATIN AMERICAN RADIO PANORAMA THE FUTURE OF RADIO IN LATIN AMERICA: A NEW REVIVAL

From the point of view of production, through computers, mobile phones the Internet is increasingly used for and tablets is increasing. producing radio programmes and this encourages connectivity since it makes it possible to access a 3. WHAT DO PEOPLE IN larger number of indirect sources LATIN AMERICAN COUN- and also to share productions in a TRIES LISTEN TO? way that is much more immediate than was possible with sending The structure of the radio sector "The structure of cassettes or CDs. is very similar in most countries the radio sector is in the region, characterised by very similar in most Thanks to the Internet, radio being extremely fragmented. countries in the region, broadcasting has lost its ephemeral There are two or three national characterised by being nature since the mass sharing of channels, controlled by large extremely fragmented” sound files is now possible after communications companies, that they have been broadcast, for are focused on audience numbers, example in podcast format. As a and a large number of other result, digital publishing and the broadcasters more focused on possibility the Internet offers to certain social niches, such as music store content online implies a great stations for the young, evangelical transformation for radio. stations for the religious groups and community stations for the One example of this is the indigenous sectors. It is clearly Colombian station Blu Radio, a case of having a fragmented whose aim is to be a station that audience and the radio stations can be listened to on the radio, responding to this by diversifying over the Internet and through their service and content. mobile phones. The same is true in Peru with RPP, which Taking as our base a study by in addition to being available Tito Ballesteros López in 2012 through the television and the “La radio en América Latina y radio, shares information in real el Caribe, Mapa Interactivo” time on its website and adapts to (Radio in Latin America and the the new digital platforms, such Caribbean, Interactive Map), we as Facebook and Twitter. It does can see that “the country with the so because of its policy of always fewest number of radio stations being connected to its audience. in AM and FM is Cuba (62) and the one with the most is Brazil The way in which radio broadcasts (3,788). The Central American are received has also undergone countries have a total of 3,649 significant changes with the stations while the South American appearance of mobile phones that countries have a total of 21,039. offer many more features than Brazil is the country with the most simple telephone communication stations, followed in order by Peru and that have FM receivers. and Chile.” Similarly, mp3 players facilitate the production of content to download Looking at the figures country by and share. The use of online radio country, and taking into account

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the lack of reliable audience over a decade. After 13 years figures in most of these, we can of leadership by Radio 10, paint the following picture of the Mitre has fought back in 2013 current situation: in relation to mornings on AM.

• In Argentina the two According to Ibope figures, generalist stations with the in June 213, in the generalist highest audience figures are area, Mitre had 41.6 points, Radio Mitre (owned by the compared to 19 for Radio 10. Clarín group) and Radio 10 In third place was La Red, (belonging to the H Group until with 12.2 points, followed by 2012 and now in the hands of Continental with 9.1. The table the entrepreneur Cristóbal of the six most listened to was López) which have been completed with Radio Nacional, fighting over the top spot in with 5.7, and Del Plata, with an terms of audience figures for average of 4.6 points.

• In Chile, the stations with DISTRIBTION OF AM AND FM FREQUENCIES IN LATIN AMERICA the highest audience figures, AND THE CARIBBEAN according to the international Country Stations Stations Total sta- consultancy firm Ipsos, are AM FM tions by Corazón with 8.5 %, followed country in second place by Bío Bío with Mexico 675 388 1,452 7.7%. After these comes FM Dos Guatemala 288 52 280 and Cooperativa, both with an El Salvador 100 148 248 audience share of 5.3%, ADN Honduras 277 626 903 (3.3%) and Agricultura (1.9%). Costa Rica 56 69 125 These are stations with very different profiles and they Nicaragua 52 228 365 are a good example of the Panama 99 177 276 fragmentation seen in these Colombia 850 1,124 1,974 media and in radio in general. Venezuela 680 563 1,243 The audience for Bío Bío is the Ecuador 233 926 1,173 over 25s, while Corazón has a Peru 466 2,192 2,732 different target audience, the Bolivia 850 262 1,112 young listener. Brazil 1,583 2,205 7,763 • The pattern is the same in Chile 174 1,410 1,994 Colombia. There are two Uruguay 89 283 372 large generalist stations Paraguay 72 637 752 (Caracol and RCN) backed by Argentina 177 1,839 1,924 powerful consortia fighting Cuba 28 34 62 for the top spot in terms of audience figures. Dominican Republic 143 231 394 Total stations 6,892 13,394 25,144 Caracol Radio is the station

Source: Tito Ballesteros, “La radio en América Latina y el Caribe, Mapa interactivo” (Radio with the largest audience, in Latin America and the Caribbean, Interactive Map) with 1,874,000 people tuning

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in each day. Caracol has 3,700 if we add up the almost 39.31% of the speech radio 1,700 on AM and 2,000 on market, while RCN has 26.20% FM. For a while, the habit “Radio in Brazil and Olímpica 13.81%. In terms of listening to the radio has experienced an of listeners per network, these grew very rapidly but since are 9,538,000, 6,357,000 and the 1990s the penetration enormous boom since 3,352,000 respectively. has been slower and always there are a large number below that of television. As of stations” We can also make out the an advertising medium, the new paths that radio is taking, share of radio has remained since we can clearly see a new stable and at a low level. development, for example with Blu Radio (96.9 FM) • In each of the two Andean which saw an overall growth countries Bolivia and Peru we in its audience figures of see the dominance of one radio 154%, according to the Estudio broadcasting group: FIDES in Continuo de Audiencia de Radio Bolivia and RPP in Peru. (ECAR, Continuous Study of Radio Audiences). This station, • In Bolivia, the main national which began broadcasting stations are Radio Fides, in September 2012, saw an which has the highest increase from 151,500 listeners audience figures, Radio per day to 384,400. Metropolitana, RED Erbol, clearly positioned on the • In Mexico, in Frequency left, Radio Panamericana, Modulation, Alfa 91.3 remains Radio Illimani, Radio La Cruz the leader, followed by La Z del Sur and Radio Nueva and La Kebuena, from Grupo América. With broadcasting Televisa; in fourth place is in the Aymara language: another from the GRC stable: Radio Cóndor and Radio Universal Estéreo, from Emisoras Unidas. Adolfo Fernández Zepeda ,and in fifth place is Los 40 • In Peru, according to a survey Principales, also belonging to by Ipsos Apoyo, the news Televisa Radio. station RPP Noticias is the most listened to and recorded In AM, in terms of news from among the list of radio channels, Carmen Aristegui, stations in Metropolitan from Noticias MVS, remains at Lima, leaving the music the top, followed by La Red stations in second place. This from Radio Red, Joaquín López radio station is followed by Doriga and Pepe Cárdenas. Moda and Ritmo Romántica, both part of the Corporación • The radio in Brazil has Radial Group in Peru. experienced an enormous boom since there are a large RPP Noticias also occupies the number of stations: close to top spot in terms of audience

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figures from Monday to Friday, 4. BUSINESS GROUPS with 54% of responses, clearly ahead of its news and music The fragmentation of audiences, station rivals, while at the the heterogeneity of supply weekend it is also the leader and the consolidation of the with 19 % of the audience. large media groups are three “The fragmentation of the characteristics of radio of audiences, the In general, 64% of those surveyed broadcasting in Latin America. heterogeneity of said that RPP is the station they supply and the listen to most frequently. For these media groups, some consolidation of the are multinationals like the large media groups • In Venezuela, the station Spanish Telefónica and Grupo that stands out is Rumbera, PRISA. The CEO of the Spanish are three of the in Puerto La Cruz, which has communications group PRISA, Juan characteristics of radio the largest average audience Luis Cebrián, announced in 2013 broadcasting in Latin (325,000 listeners). Another its plan to expand in Latin America America” three stations in Puerto La given that PRISA’s Latin American Cruz exceed 200,000 listeners radio stations now account for on average. In Valencia, more than sixty percent of the the station Bonchona division’s turnover and Radio attracts 310,000 listeners. Caracol (Colombia) is, in abolute In Maracaibo, four stations, terms, “more profitable” than the headed up by Mega, from Zulia, cadena SER channel in Spain. exceed 200,000 listeners. In Barquisimeto, the leader is • In Argentina, the two main Rumbera, the only one with groups are the Clarín group more than 200,000 listeners. and Telefónica, multinational In the federal capital, the companies that control two audience is divided among a of the radio stations with the large number of companies. highest audience figures (Radio Only three stations have Mitre and FM 100). In addition, more than 100,000 listeners: we have the H group, owned La Mega de Caracas, Onda by Daniel Hadad, whose main Caracas and X Caracas. stations were purchased in 2012 by Cristóbal López, a • In Ecuador, radio is the businessman closely linked to most important and least Kirchnerism, from the Indalo concentrated means of group (Radio 10, with the communication, compared highest audience figures, and to the press and television. the FM stations Mega and Pop). However, more than a third of all radio stations are located In terms of the local multimedia in Quito and Guayaquil, which groups, it is worth mentioning reflects the high degree of the aforementioned Uno group geographical concentration of (Santa Fe, Mendoza, Entre this means of communication in Ríos), as well as others such as the two centres of economic and the El Chubut group (Chubut), political activity in the country. the Segovia group (Santa

73 THE LATIN AMERICAN RADIO PANORAMA THE FUTURE OF RADIO IN LATIN AMERICA: A NEW REVIVAL

Cruz), the Julio Shroeder group Radio Fórmula, an organisation (Neuquén), the García Hamilton controlled by the Azcárraga group (Tucumán), the Río Madero family, has also Negro group (Río Negro), the developed its own network of San Luis group (San Luis), the 83 stations in Mexico and the Cadena 3 group (Córdoba), the United States. It has a very Ancasti group (Catamarca), the strong presence in the Mexico Horizonte group (Salta), the ICK City market. group (Santiago del Estero), the “Over the last few years Montes Group (San Juan) and Over the last few years there has been a rash of the Almada group (Misiones). there has been a rash of purchases of stations by purchases of stations by larger larger groups” • In Chile the two largest groups, which has led to the groups merged in 2006. consolidation of channels The Spanish company Unión such as Imagen, owned by the Radio, from the PRISA group, Olegario Vázquez Raña family; which at that time controlled ABC Radio, controlled by Mario the Consorcio Radial de Chile Vázquez Raña; Radio Centro, (Chile Radio Consortium) with the Aguirre Gómez family with four national stations as the majority shareholder; (40 Principales, Bésame, Radiorama, headed by the Radioactiva and W Radio), Pérez de Anda family. took over the largest radio group in the country, at • A special case is the that time owned by the Multimedios group, the only Venezuelan group Cisneros. regional group (it operates The resulting consortium, in the north of Mexico) that Iberoamerican Radio Chile, combines the publication of has eight national stations, newspapers and magazines several of them leaders: with television stations, Pudahuel, Rock and Pop, Internet access and the running Corazón, FM Dos, Concierto, of a radio business (jointly Futuro, FM Hit and Imagina. with the Spanish PRISA group).

• In Mexico, public radio plays an • In Brazil the Globo group important role and the state- stands out and includes the owned Instituto Mexicano de radio stations Globo and El la Radio (Imer) is involved Dorado, in Río de Janeiro; in commercial broadcasting Nacional and Excelsior, in São through 11 stations. Worth Paulo; Continental, in Río mentioning among the private Grande do Sul; Tiradentes, in companies is the Acir group, Minas Gerais, and Reporter, the largest group owning and in Pernambuco. Also worth operating radio stations. The mentioning are the Abril group, consortium has more than 180 Folha group, the RBS group and stations and is controlled by the Estado group run by the the Ibarra López family. Mesquita family.

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• In Colombia behind the media according to the Asociación de we can see the hallmarks of Radiodifusoras Privadas Argentinas large conglomerates: RCN (ARPA, the Association of Private Televisión and Radio belong Radio Stations), the country has a to Organización Ardilla Lülle total of 10,671 stations, of which and Caracol Radio to the only 4,145, or in other words only Spanish PRISA group. 38%, have documents authorising them to broadcast. This situation • In Peru, the RPP group is is even more pronounced in FM “The fragmentation of the radio channel with the and in the metropolitan area of the audience has come greatest coverage and one of Buenos Aires, where there are hand in hand with a the most important and most 251 registered stations and 550 heterogeneous supply listened to in the country. It unlicensed ones. Here there are up in terms of the content has 7 national radio stations to 20 stations broadcasting on the and types of stations that offering daily programming for same frequency and, as a result, different types of audience: interfering with each other. seek out specific target Radio Felicidad, Studio 92, audiences rather than Radio Corazón, Oxígeno, Radio However, beyond this fragmentation generalist ones” La Zona, Radio Capital and of supply one can currently make RPP Noticias. Corporación out the consolidation of three types Radial del Perú (CRP), is also of radio station: a large conglomerate that has segmented music stations Generalist vs Specialist radio that connect with different stations target audiences. Its stations are Ritmo Romántica, La Generalist stations are those with Inolvidable, Moda, Oasis, the most impact and political Radiomar, Nueva Q FM, influence, especially in urban areas, Planeta, Inca and Mágica. The but they are clearly in stagnation Panamericana group has radio or decline since they take longer Panamericana and radio Onda to modernise and adopt new Cero and Corporación Universal techniques. This is because of their has the stations La Karibeña, more traditional format and general La Exitosa and La Calle. content (mainly news and magazine programmes) that try to appeal to 5. DIVERSIFICATION OF the largest number of listeners. SUPPLY In contrast to this generalist The fragmentation of the audience radio, the specialised stations has come hand in hand with a that dominate FM are having heterogeneous supply in terms of striking success as they target the content and type of stations that more specific listeners with more seek out specific target audiences defined interests. rather than generalist ones. Community radio stations This diversification of supply translates into examples such These are stations designed to as those in Argentina where, support the organisation of social

75 THE LATIN AMERICAN RADIO PANORAMA THE FUTURE OF RADIO IN LATIN AMERICA: A NEW REVIVAL

groups, such as those created in the groups, some connected to past by the mining communities in Liberation Theology. Bolivia. It is the community stations that now stand out, especially The development of popular radio those for indigenous and ethnic stations initially had a double groups. They have a philosophy of connection; first connected to public participation and seek to the catholic sectors as a result of prevent the exclusion of the social experiences in educational radio, and ethnic groups most neglected and second connected to the unions “It is the community by the country’s economy. which, for example in Bolivia, have stations that now stand their roots in the mining stations out, especially those This type of station has been very from the 1950s and 1960s. for indigenous and successful in some countries like ethnic groups. They Bolivia, Ecuador, southern Peru and One example of this is in Ecuador, have a philosophy of Guatemala, especially in terms where since 1988 the Coordinadora of their establishment This is the de Radios Populares y Educativas public participation and case with Onda Local, a network de Ecuador (Corape, Coordinator preventing exclusion from of Bolivian municipal stations from of Popular and Educational Radio society” the Federación de Asociaciones Stations of Ecuador) has focused on Municipales (Federation of supporting educational, popular Municipal Associations) created and community radio services. with the support of institutions such Its objective is to encourage as AECID and other cooperation “the participation of the public agencies, and the Red de Radios in the process of recognising the de los Pueblos Originarios (Radio culture of its people, as well as Network of Indigenous Peoples) achieving the democratisation and the Red Patria Nueva (New of communication as the Nation Network), designed to central focus of its activities.” support indigenous communities It involves 35 affiliated stations and unions. distributed over four regional networks, Amazónica, Quichua, Community radio stations are Binacional and del Sur, that feed characterised by UNESCO for their the Red Nacional de Corape high level of public participation, (Corape National Network) with in both management and the information. production of content, and their decision making structure. 6. CONCLUSION: THE FU- TURE OF RADIO BROAD- The survival of popular radio CASTING stations Not only has radio in Latin America They were a development that not died, but everything points to took place in the 1960s and 1970s it proving itself capable of adapting and they are still going strong very well to new times and these today in certain places. They have are giving it a new opportunity, the the profile of rural stations with chance to reinvent itself. Above all alternative ideas, associated with this is because radio continues to the trade union left or religious occupy a space that other media

76 THE LATIN AMERICAN RADIO PANORAMA THE FUTURE OF RADIO IN LATIN AMERICA: A NEW REVIVAL

cannot fill: the audience continues respond to this change. to prefer (or need) radio, although In Argentina we have now it is not just in the home but Vorterix, the latest project rather at specific times of the from Mario Pergolini, which day, in the work environment and combines radio, television increasingly over the Internet. and live events; and there is also Cienradios.com, The advances in communication from the Clarín group, have not supplanted radio, but which offers more than “The advances in instead have complemented it, 400 links for online music communication have as noted by Juan Carlos Gómez, content grouped into not supplanted radio, director of Observatorio de Medios genre, decade and artist, but instead have de la Universidad de la Sabana (the among other combinations. complemented it” University of La Sabana’s Media Observatory, Colombia), given »» Radio in Latin America is that the arrival of new formats also adapting to new times has encouraged the media and the by increasingly involving professionals working in the media listeners in programmes, to make changes, required as they therefore bringing the are to “come up with strategies medium closer to the and alternatives to prevent a loss consumer. of audience and this results in a benefit for the audiences who are For Juan Carlos Gómez, the looking for the best. Quality is aforementioned director of always going to be popular with the Observatorio de Medios audiences, it is always going to help de la Universidad de la audience figures.” Sabana, the new proposals for morning radio are What are going to be the key founded on the evolution features of the Latin America of the medium, generated radio panorama in the short and by the emergence of the medium term? social networks and the new electronic media. • Firstly, the new paths being taken by radio are designed The best way to work out to strengthen the connection what the listeners want between the media and the is, according to Gustavo listener. How? Gómez, from Caracol Radio, “To do what they »» On the one hand, the future do: listen to them. Taking of radio will follow the the temperature on the route of diversified supply street, in taxis, from to adapt it to the different emails and on-air calls, niches in the population. from Twitter... you have to listen to the listener! Some developments in Latin America are following In Peru, this is the format this pattern and trying to used by Radio Capital,

77 THE LATIN AMERICAN RADIO PANORAMA THE FUTURE OF RADIO IN LATIN AMERICA: A NEW REVIVAL

belonging to the RPP classes gain purchasing power conglomerate. The and can access the new approach adopted by technologies). According to Capital has been clear the audience measurement and direct from the start: company ComScore, in Giving the public a voice December 2012 more than through telephone calls 3.6 million Argentinians so that they can express aged over 15 listened to the their opinions during radio through the Internet “Although the traditional the programmes. “Your (20% more than in 2011) and way of listening to the opinion is important” is they listened to an average radio still exists, the the slogan used to promote of 3.16 hours. This figure consumption centre for this activity and that has only includes those doing so radio has moved from been retained to date. through their computers and the home, a fixed and does not take into account • Secondly, the scope and the many listeners accessing stable point, to tablets, platform for the relationship the services through specific computers and mobile between the medium and applications on their mobile phones” the listener are going to phones, either though 3G change, as in reality they networks or Wi-Fi connections. have already done. “Although the traditional Not only is the relationship way of listening to the radio between the medium of radio still exists, the consumption and the listener changing, but centre for radio has moved so is the platform that supports from the home, a fixed and this relationship. As was very stable point, to tablets, rightly argued in the newspaper computers and mobile phones, La Nación de Argentina “the mobile devices that allow dial has moved from the radio us to inform and entertain spectrum to the Internet, where ourselves on the go”, argues there is no AM or FM. There the Pablo Salvatori, Director of old formulas compete with Marketing at Batanga Media, new proposals, stations that whose platform has 1.4 million reproduce the programming registered users. that they broadcast over the “ether” and new alternatives • On changing the relationship that are only found online.” between the listener and the radio, and the platform where This has already become a very this relationship exists, there clear trend in some countries is also going to be a change and in other countries it will in what is consumed, since arrive sooner rather than online radio is very segmented later (as the emerging middle and not very generalist.

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Enrique González José Luis Di Girolamo Avda. Samuel Lewis. Edificio Omega, piso 6 Partner and CFO Partner and CFO, Latin America Tel: +507 206 5200 [email protected] [email protected] Quito Jorge Cachinero Antonio Lois Corporate Director for Reputation and Innovation Regional HR Director Catherine Buelvas [email protected] [email protected] Managing Director [email protected] IBERIA Bogota Av. 12 de Octubre 1830 y Cordero. Arturo Pinedo María Esteve Edificio World Trade Center, Torre B, piso 11 Partner and Managing Director Managing Director Distrito Metropolitano de Quito (Ecuador) [email protected] [email protected] Tel: +593 2 2565820

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