The Ibero-American Observatory of Television Fiction (Obitel) reports that in 2013, there were forty-eight national television broadcasting networks in seven of the most important Latin American markets.23 Despite this seeming diversity, the domination of these national markets still falls in the hands of a few corporations. Out of the forty-eight networks, only twelve play a prominent role in these seven major markets. In most cases, two networks hold more than 90 percent of the national audience share.24 There is a correlation between these networks’ prominent market position and their capability to produce their own prime-time content, in particular fictional programming. Big-budget projects such as telenovelas are mostly produced in-house by these networks, but in today’s competitive environment these networks increasingly hire indies to produce series and miniseries that require innovative approaches.
The pressure to innovate derives from the fact that the multinationals are making use of cable and satellite services to gain a foothold in national markets. By 2013, 55 percent of Latin American households had access to these new services, and in some key markets, such as Argentina, more than 80 percent of households had access. These changes are reflected in ratings as well. Latin American Multichannel Advertising Council (LAMAC) reports that broadcast TV audience share fell from 86 percent in 2005 to 70 percent in 2014, while pay TV audience share rose from 14 to 30 percent in the same period.25 Moreover, the pay TV audience is generally more affluent and therefore more desirable to ad-based and subscription television companies. Given this media landscape, transnational television networks are increasingly making investments to localize programming with the aid of local indie producers.
The new battle to effectively capture “desirable commercial audiences” in a newly populated industrial scenario brought about innovation but also the rehashing and remaking of “proven ideas and formulas” to successfully appeal to national and transnational audiences. In the case of indies working for the television industry, their size, budget, and production capacities are reflected in the kind of television programming they can offer their clients. In today’s television landscape, there is great demand for documentaries, global formats (particularly reality TV), and fictional formats (particularly series), which range from small- to large-scale productions.
Despite the growing number of independent production houses, most have a short life span, and very few produce for the national television networks that can reach mass audiences. “Here, house productions last very few years,” acknowledged an executive producer of Laberinto Producciones in Colombia.26 While his production company is twenty years old, his assertion underscores the rarity of its position. In a similar statement, an executive producer from Argos Communication, Mexico, states that most transnational companies looking to produce a telenovela would have to select from only a few production houses: “Anybody who pretends to have strong presence in Mexico by producing more than a hundred episodes is going to face complications. In Mexico only we can do that.”27 Similarly, an artistic director from Del Barrio Producciones in Peru recognizes that “there are really few production houses that have the economic means to produce at that level.”28 These assertions reveal the challenges these production houses face in the context of their structural industrial relationship with the gatekeepers of distribution: the television networks. A handful of networks have the power to decide what gets produced and distributed nationally and, ultimately, internationally. National TV networks set the terms in contract negotiations, generally offering one of three options: they offer a flat producer’s fee and retain the copyright; they forge a coproduction agreement based on the investments of the respective partners, with each retaining distribution rights for specific territories; or they agree to broadcast a program that is fully financed by the independent production house, which retains the copyright. In spite of these three options, most indies can’t risk producing their own content because a single failure would likely bankrupt the company. Most commonly, an indie producer will pitch an idea to the networks. If the network is interested, it offers the first option and the producer accepts, reasoning that there will be a secure flow of income to keep the studio staff employed. When dealing with successful producers, networks commonly offer “exclusive” conditions through “volume content agreements,” signing the producer for a number of projects. In other cases, a network will sign an agreement with a successful producer that gives it a “first look” at all new projects. Such agreements allow the network access to top material and give it the option to buy a project and shelve it for an indefinite period so that it doesn’t fall into the hands of a competitor.
