Local Competition Heats Up Chile’s TV Business

In a globalized international TV business, which will converge in Cannes for the Mipcom trade fair Oct. 5-8, there are no limits to the ambition of even the world’s smaller countries. And those ambitions can often run through alliances with and sales to the U.S.

Few examples are more eye-catching than Chile, despite its relatively small size, a TV production force thanks to the export of its small-screen fiction formats in partnership with Telemundo.

Chile is far from North America, Europe and Asia, and with some 2.5 million households with free-to-air TV access, it ranks well below other Latin American TV territories such as Brazil (43 million FTA homes), Mexico (16 million), Colombia (7.5 million) and Argentina (5 million).

However, the Chile TV market boasts one of the most cultured and educated of all Latin American societies and fierce internal competition from free-to-air TV players like pubcaster TVN; Mega, owned by Chile’s Bethia Holding; Turner Broadcasting System’s Chilevision; and Canal 13, controlled by Luksic Group.

“Chile has generated high-level writers, who have created some excellent TV” series, says Marcos Santana, president of Telemundo Intl.

And the lack of a big local TV market has merely encouraged broadcasters to look towards international outlets.

Latin America and U.S. TV giant Telemundo — part of NBCUniversal — has sold adaptation rights of Chile’s TV stories to more than 30 countries to date.

Some Chilean TV fiction series already figure among Latin America’s best-selling TV adaptations, such as 2009’s Pablo Illanes-penned suspense telenovela “Donde esta Elisa,” whose TV redo rights were acquired for territories such as the Philippines, Turkey, Colombia, India, Indonesia, South Korea, Portugal, Italy and the U.S., where Telemundo produced a version that sold to 45-plus countries.

Produced in 2008 by TVN, Victor Carrasco’s telenovela “Hijos del Monte,” about five brothers struggling to maintain the family farm, was adapted by, among others, Telemundo in the U.S., TVI in Portugal and LBC in Middle East, with the U.S. version being sold to 46 territories.

Telemundo Internacional handles 95% of the product that the TV industry generates in Chile, Santana says.

But the international visibility of Chilean TV fiction in recent years has taken in other genres. One example: Sergio Gandara’s Santiago-based TV house Parox, which is developing for NBC an English-language remake of TVN’s sci-fi series “Gen Mishima,” in partnership with producer Sergio Aguero (“Red Band Society”) and “Numbers” showrunner Ken Sanzel.

Well-known filmmakers Pablo and Juan de Dios Larrain (“No,” “The Club”) marked a milestone for Chilean TV in 2011, producing crime drama series “Profugos” for HBO. Early this year, the Larrain brothers launched Fabula TV in partnership with Spanish conglom Grupo Secuoya to produce fiction, docs and entertainment shows.

Chilean TV’s international muscle includes its animation sector, boosted by shingles such as Alvaro Ceppi’s Zumbastico Studios, which broke through internationally in 2011 with pre-school series “Zumbastico Fantastico,” picked up by Cartoon Network for Latin America.

But despite the content fueling the country’s TV sector, the Chilean market is suffering from the switch from analog to digital, to be completed by 2019. “There is a definite mandate to do the transition, but Chile was slow to adopt a DTT standard,” says IHS analyst Erik Brannon.

Also, with the exception of Mega, during the first half 2015, top Chilean broadcasters showed losses due to Chile’s TV ad market contraction.

Further challenges affect domestic operations, such as the encroaching popularity of Turkish dramas, which have a fairly high production levels and a significant acceptance in Chilean primetime, notes Santana.

“This means that the audience will be more demanding regarding the quality of local TV products,” he adds.

A traditional motor of Chilean industry, TVN continues to bet strongly on fiction, having recently co-produced with Telemundo the series “Masters of Paradise,” and teamed with Fox Intl. Channels Latin America on ambitious period action skein “Sitiados.”

“We have innovated with international co-production,” says a source at TVN, adding that the two series provided invaluable experiences in co-operation and learning, while being a hit with critics both nationally and internationally.

Chile’s top-rating TV net over the last 18 months, Mega is closing in on TVN’s traditional TV fiction production leadership. “We have constructed a content factory recruiting the best talent in Chilean television,” says Patricio Hernandez, executive director of Mega.

Mega’s profits were partially boosted by the standout performance of top local shows “Pituca sin Lucas” and “Papa a la deriva,” which are under advanced negotiations for an international sales deal, according to Hernandez.

“Local operators are betting on the right way, producing local and unique TV content that connects with the audience,” Santana says. “This is the only way that will allow them to survive in an increasingly more fragmented market.”

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