Televisa’s Emilio Azcárraga Jean

October 2007

Televisa is a powerhouse in the Spanish-speaking world. It is the market leader in Mexico, with an approximate 70-percent average audience share derived from a mix of telenovelas, variety shows, entertainment, news, sports and movies on four national networks. It also owns 14 channel brands for the pay-TV market and holds stakes in the cable operator Cablevision; the satellite platform Sky Mexico; and La Sexta, a new commercial network in Spain. Emilio Azcárraga oversees all of this and more. Televisa also operates an Internet portal and is active in publishing, CD, movie and home video production and distribution.

WS: Televisa continues to launch new channels in Mexico. What growth opportunities does the Mexican market still offer?

AZÁCARRAGA: I believe pay TV is very important because its penetration is very low. Right now it’s at about 25 percent in Mexico and given how rapidly technology is advancing, and the increase in convergence and new offerings and new players, the pay-TV market can be interesting because these factors tend to lower costs, which not only benefit consumers, but media companies and good content producers as well. This is the situation in Mexico but also in Latin America and even in the U.S., where penetration among the U.S. Hispanic market isn’t as big as it is in among the total population. I feel there are still many opportunities not only in the distribution business but also in the production and channel businesses as well.

WS: What is more important for a great media enterprise: owning programming or having distribution platforms?

AZÁCARRAGA: Distribution is important but we must focus on good content; especially with technology today that allows you to watch what you want, when and where you want. Today we see a great deal of content that’s not necessarily good. That’s why I believe production is very important. But I also think having access to the homes and to personal computers is important and that’s why we now have the distribution business through cable and Sky. Both facets are important although we don’t need to be in the hands of third parties, which is the reason for our investments in platform distribution. But good content is fundamental.

WS: What plans are there for Televisa Networks internationally?

AZÁCARRAGA: Televisa Networks is an enterprise that has been growing at an important rate. In the last semester, it’s been one of the group’s division that has produced the best results, not only with sales generated in Mexico but foreign sales as well. Apart from creating channels or ideas, Televisa Networks is open to concepts from different places, ideas that can be co-produced and distributed here and in other regions. As we metioned earlier, the growth of pay TV will be very important in the years to come. It makes the production and co-production of quality content a great advantage for the growth of Televisa Networks.

WS: Are you satisfied with the performance of La Sexta?

AZÁCARRAGA: We’ve been very lucky with La Sexta. I believe the first thing was finding the ideal partners, a group that we enjoy working with, people with whom we have a very good relationship even outside of the work environment. The flow of communication has improved and we understand each other better. The truth is that the business plan we outlined for La Sexta has turned out to be better—even if just a little—than we had hoped. I believe we can do a whole lot more with broadcast and pay TV, co-producing here and there for both markets. La Sexta has been on the air for practically a year and it’s already yielded results. We now have to focus on the future and see what other opportunities we have in Spain; which is a large and mature market.

WS: What plans do you have for the U.S. market; will it be difficult to produce in English?

AZÁCARRAGA: I don’t think so. The truth is that good ideas have originated here [in Mexico]. The production system, the way we tape our shows, is also very important. On the other hand, foreign ownership restrictions do not apply to production in the U.S. or anywhere else in the world. We’re exploring opportunities and have concluded a couple of things we’ll announce as soon as production begins. We think that investing in a U.S. network is important. We’re looking for available opportunities, since our interest in Univision never came to fruition, but we’re searching for other possibilities Televisa has to better deliver content and to more people.

WS: Speaking of the sale of Univision, do you think that the tense relationship between you and Jerry Perenchio had something to do with the decision to sell the company to a private partnership instead of Televisa?

AZÁCARRAGA: We made our offer and said we could do better but we weren’t allowed to. The decision was made by Mr. Perenchio and the company’s shareholders. Being a shareholder myself, I believe that the price paid for Univision was very good. We were happy with the value given to it as we sold our share. It’s the value of a dream born in 1966, of having a television channel in the United States called Spanish International Network, seeing it launch as a UHF channel in San Antonio and becoming a very important network in the country. I’m very proud to have participated not only in this administration and its programming, but also in its birth within Televisa at that time. As I said before, we’re interested in having a network in the United States. Univision is an opportunity but other networks are as well.

WS: Televisa has reached various important agreements with China. How did this come about and what opportunities does it offer the company?

AZCÁRRAGA: We’ve been in the Chinese market since 1972. We’ve had very good relations with the various government officials and the opportunity presented itself. China is more prominent because of the importance it has today, but the Middle East has always been interesting to us and we’ve done many programming sales there. We never really put in the time and effort to expand our horizons in China, in particular because of the restructuring we underwent between 1997 and 2002; new opportunities are opening now however. Pepe Bastón [the head of Televisa’s television operations] went there with his team to see what more could be done, but not only in the traditional programming sales arena. Some ideas came from two or three Asian groups, not just from China and they will be underway in the near future.

WS: What are your thoughts on Venezuela’s situation with RCTV’s shutdown?

AZÁCARRAGA: I think it’s a disgrace. I believe in freedom of expression, in democratic governments and that liberty should be exercised responsibly. There is a fine line between liberty and licentiousness but I believe that what happened in Venezuela was not an act of licentiousness but a governmental action that should not take place anywhere else in the world. I don’t believe it’s only with the media but suddenly all the attention is on the media, be it Televisa, RCTV or any other network. Those of us who work in television have to understand that the strength of the networks belongs to the people who watch us everyday. Ultimately, broadcast television is the most democratic instrument in the world; first because it’s free and second, because you can turn it on and off or change the channel anytime you want whether you are the most or least powerful person in the world. Therefore, the viewing public has this power, and we who dedicate our lives to this business owe them credibility and respect. Any attack against the media is a reversal of technological and historical progress of the region and the world. It’s an example we must keep present. We must fight so it doesn’t happen anywhere else and so that RCTV to be given back its rights.