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Cable television in Latin America (Second installment)

Experts say the outlook for cable TV in Latin America remains bright in the long run, despite the recent spate of economic woes.

While many of the economies of Latin American countries seem uncertain, international investors in the television industry are projecting the situation in the long term and have already begun to take advantage of the region's favorable prices. In fact, today many are enthusiastic about the investment in multichannel television and visualize attractive programming prospects in a region that has 79.4 million viewing households and 9.6 million subscribers to the multichannel system.

According to experts, the global economic trend does not positively or negatively affect the communications business in Latin America. There is demand either in a good economy or in a bad economy. The future looks very promising because the area is under-pedestrianized. As an example, if our continent is compared to others, 12% of multichannel television penetration in Latin America lags far behind 18.6% in Asia Pacific, 27.8% in Western Europe and 64.3% in the United States.

What is clear from investors is that the key to success in a competitive Latin American market is to "be the first to arrive". Other effective tools are local programming, strong customer service, and exclusive programming as effective tools.

Local programming, the key to success

- Publicidad -

Beyond prices, programmers must focus on quality, utility and new services that include the offer of exclusive programming (sporting events or musical shows, for example). Exclusive programming is much more valuable when you have competition.

Perhaps the most powerful tool in cable television is local and regional programming. In fact, because the countries of the region differ so much from each other, seeking and developing specially designed regional content is an essential strategy for entrepreneurs.

As the industry grows, specialized design, primarily through joint ventures, will determine the rules of the game.

Investing in Latin America, a good decision

The fascinating new opportunities offered by Latin America allow many of the major cable and telephony providers to reap great benefits from an expanding market that is virtually uncontrolled. The case of Chile is probably that of one of the most liberalized networks. Analysts even argue that many opportunities for the converged services that characterize the interactivity of the future may well be found first in Latin America.

This does not mean that every company doing business on the continent is going to get unlimited success. Not all providers make it, particularly those who don't have the ability to stay in the game.

You also have the problem of negotiating with the right carriers. In Argentina there are currently more than 1,000 cable television companies; in the recent past there were more than 1,500 suppliers.

- Publicidad -

The main factors driving this situation are the lack of regulation of national carriers and the lack of bureaucratic control in general. Government officials in Latin America realize that they can no longer afford to have poor services while their neighbors get the latest equipment and this has resulted in one of the business' greatest potentials.

Interestingly, suppliers that occupy 35 to 40% of the market in Latin America usually see that they are handling a much newer technology than that used in the United States. This is because, until now, the equipment had been so inadequate that carriers often started with a blank sheet. In addition, much of what is done in the United States is limited to improving the systems already installed.

How to negotiate successfully

The only way to do business in Latin America is to know and understand it. Companies that intend to conduct business in Latin America as if they were in Europe will be speaking a different language in very different cultures, just as they do in European countries. You need to know who you are dealing with. The diversity of cultures must be respected. You shouldn't get there trying to impose what you do in America. It is necessary to see how to adapt and offer a solution.

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