Exclusive Interview: Globo’s Roberto Irineu Marinho

March 23, 2011 World Screen

PREMIUM: Organizações Globo is a media powerhouse in Brazil with free and pay television, radio, newspapers, publishing and film. The country’s booming economy, growing advertising and consumer spending are all benefiting Globo’s businesses, as president Roberto Irineu Marinho tells World Screen.

 

WS: Brazil’s economy has been quite strong. How has economic growth stimulated the advertising industry in Brazil and how has this benefited Rede Globo?
MARINHO: The Brazilian advertising market showed excellent results in the last few years, especially during the second half of 2009 due to the growth of the economy and of consumer spending. In 2009, the ad market reached R$22.3 billion [US$13.3 billion], which represented 0.70 percent of Brazil’s GDP.
 
In 2010, advertising grew by 20.6 percent from January to October, compared to the year before. Free TV strengthened its position as the country’s dominant medium, growing its audience share and capturing 63.2 percent of advertising expenditures. Naturally, as market leader, TV Globo had excellent results.
 
WS: How has the strong economy stimulated the growth of pay TV in the country?
MARINHO: The last few years have been excellent for pay TV in Brazil. After a long period of sluggish growth, which lasted till the beginning of this decade, several factors contributed to the growth of the pay-TV subscriber base: the growth in infrastructure, the entry into the market of new DTH operators, the growth in families’ disposable income, the greater participation of the C Class in the market and the perception of pay-TV as an aspirational product.
 
Today in Brazil, there are nearly 10 million pay-TV subscribers, with a penetration of 17 percent of Brazilian homes and there is still much room for additional growth.
 
Consumers have demonstrated a strong preference for Brazilian content and quality programming, a trend that strongly benefits our Globosat channels. We reached first place in pay-TV viewership with SportTV and we have nine of the 20 most-watched channels.
 
WS: What is Globo’s commitment to tele­vision news?
MARINHO: For Rede Globo, its investment in journalism is a priority. We air five-and-a-half hours of news in seven national broadcasts. In addition, each local station airs four local newscasts each day. This amounts to a total of 62,000 hours of TV news per year with a monthly average of 5,100 hours per month. The network has 4,700 journalists, 11 international correspondents and 650 reporting crews divided among its 122 stations. News and information, accurately and clearly presented, are essential components of Brazilian television. TV is the preferred medium Brazilians use to inform themselves about the world, their country and their local issues.
 
Research conducted by the government in June 2009 indicates that 65 percent of Brazilians believe that news is the most important TV genre. This research also demonstrates that Globo’s national newscast, Jornal Nacional, is the most-watched newscast in the Brazil with a 56.4 percent audience share.
 
Brazil is a well-established democracy of which freedom of speech is a main pillar. We believe that government interference in journalism should never take place. Several decisions from Brazilian courts and pronouncements from executive powers reinforce the adherence to this constitutional right.
 
WS: A portion of Globo’s schedule is dedicated to programming targeted to lower-income classes and offers job training or basic information about health issues. Why is this important for Globo?
MARINHO: Because of the deficiencies that still exist in Brazilian society, as a mass medium, with its wide reach and relevance, Globo believes it has a very important social commitment.
 
One of the ways it exercises this commitment is its responsibility to inform well, which I already talked about. The other is to bring to the forefront not only in news programs but in all its activities topics that are crucial to Brazilian society.
 
Among commercial broadcasters around the world, Rede Globo is a pioneer in inserting pro-social campaigns into the context of its programs, mainly in its novelas and series. For this innovative practice, in 2001, Rede Globo won the Business in the Community Award of Excellence, one of the most highly regarded social responsibility awards in the world.
 
I can cite examples of three such initiatives and their practical results. The telenovela Laços de Família (2000), which dealt with organ donation, resulted in an increase from 20 to 900 pledges per month in the nation’s registry of bone marrow donations. The telenovela O Clone (2001), which dealt with drug addiction, resulted in an increase from 900 to 6,000 phone calls per month to the National Anti-Drug Department. And the telenovela Cami­nho das Índias (2009), which raised mental health issues, resulted in twice the number of requests for treatment at the Psychiatric Association of Rio de Janeiro and its related entities.
 
In addition, Organizações Globo [parent company of Rede Globo] also runs the Fundação Roberto Marinho [FRM], a non-profit organization geared toward education on several levels. FRM, together with other partners, operates the educational channel Canal Futura and produces the program Telecurso, which awarded diplomas to millions of Brazilians through televised educational courses.
 
WS: What is your strategy for increasing international expansion?
MARINHO: For more than 30 years, Globo TV International has been distributing programs to more than 130 countries. Its catalogue offers more than 300 drama titles. In 2009, it sold 65 productions to 83 countries in 21 languages. We licensed more than 25,000 hours and we’d like to highlight sales to the U.S. and to South Korea, which aired 16 different programs, and Ecuador, which aired 15 programs.
 
This revenue is small compared to Organizações Globo’s total revenues but our international business will continue to grow.
 
International co-productions set locally are a new business for us. Significant examples are the international launch of the co-production O Clone in Spanish, produced with Telemundo; Laços de Sangue, with the Portuguese broadcaster SIC and Entre El Amor y el Deseo, with TV Azteca in Mexico. We believe that such partnerships are a great opportunity to expand our presence in the international market.
 
In addition, we distribute channels with Portuguese content around the world. TV Globo International is the first 24-hour Brazilian channel transmitted digitally overseas via satellite, cable and IPTV. Launched in 1999, the channel has 550,000 premium subscribers in 115 countries on five continents. Its programming consists of live newscasts, sports, novelas, mini-series, children’s programming [and] variety shows, in addition to exclusive events such as Dia da Amizade Angola-Brasil and editions of Brazilian Day produced from New York, Toronto, Tokyo, and London.
 
We also have an exclusive premium Brazilian football channel, PFC International, which already has more than 200,000 subscribers in 22 countries.
 
WS: How is Globo preparing to cover the FIFA World Cup in 2014 and the Olympics in 2016?
MARINHO: For Globo, the FIFA World Cup and the Olympics are not two isolated events. They are reference points to what will happen in Brazilian sports throughout the next decade. They will trigger expansions in the program schedules in our free TV, pay TV and events business throughout this entire period. But more than this, they will be symbolic of Brazil’s new presence on the world stage, and also provide opportunities to cover related topics, such as ecology and diversification.
 
Consequently the role of Organizações Globo in these events transcends the role of its teams of sports journalists—more than 1,000 professionals at TV Globo and Globosat, and more than 200 additional professionals hired from independent production companies to help cover these events. Coverage of these events involves our entire group and all its divisions: new technologies, new ways of covering events and promoting them, a special focus on journalism and new digital products. The World Cup and the Olympics represent for Globo more than two events we will be broadcasting. They represent our overall arc for this decade, with all the business opportunities connected to them.
 
WS: Do you consider the Internet to be a threat to television?
MARINHO: To the contrary, in my opinion, TV—both free and pay—and the Internet form a perfect symbiosis. The Internet enhances the TV viewing experience because it adds interactivity and it allows social networking communities to be formed around programs. It also provides exposure to more in-depth original material linked to the program, without the limitations associated to the linear schedule. And finally, the Internet offers portable content, which can be enjoyed on any platform. The Internet offers television an enormous range of possibilities, strengthening its position as the public’s preferred medium. That’s why globo.com, with its role as a complementary platform to the TV channels, is the market leader in news, sports and entertainment on the Internet in Brazil.
 
WS: Can product placement and product integration help combat the habit of skipping through commercials when watching shows recorded on DVRs?
MARINHO: It’s important to remember that free TV is now, and will continue to be for a long time, the dominant media platform in Brazil. This fact is reflected by the audience dominance of free-TV networks, as well as cable and satellite channels. Despite forecasts to the contrary, this dominance was reinforced in the last two years.
 
Live TV events will continue to be very relevant, both in news and in sports. Advertising will continue to be an integral part of these events. Other forms of integrated advertising are already being used in telenovelas, mini-series and reality shows. The creative efforts of advertisers and producers of content will take integrated advertising to an even higher plateau. Given this picture, I believe that any mechanism designed to curtail the exposure of advertising will have a limited impact in the Brazilian market.        

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