ABTA Wraps on High Note

SÃO PAULO: Competition posed by over-the-top services like Netflix and the impact of Law 12,485 imposing quotas for Brazilian content on pay-TV programmers were key issues at the ABTA Expo & Congress, which wrapped in São Paulo yesterday.

Speaking at the closing of the event, the president of Brazilian media regulatory authority ANCINE, Manoel Rangel, praised the commitment and effort of all operators, programmers and producers to comply with Law 12,485, also known as the SeAC Law, which was passed in 2011.

According to Rangel, the new demand for local productions will result in a larger cable TV market that will contribute to the growth of broadband services as well. “Other audiovisual services come into motion and tend to expand as well,” he said.

One of the main issues discussed in most panels was the competition between pay-TV and over-the-top services. One panelist, for instance, referred to Netflix as "Voldermort, he who must not be named."

Pay-TV representatives called for equal conditions to compete with these entrants, which often operate in other countries and, therefore, are unregulated. “We believe that these services can coexist. They compete but coexist,” said Rangel, who said he was willing to regulate them as well.

According to TV columnist Cristina Padiglione, at the newspaper of record O Estado de S. Paulo, Netflix had no comment about whether it has an office in Brazil—and consequently if it pays taxes in the country as its competitors do. “We will not compromise any service distribution of audiovisual content. These services coexist and mutually strengthen each other, intensifying the habit of consuming audiovisual content and helping strengthen audiovisual production.”

Rangel and his regulatory agency seem to be aware of the impact these new services are having in the Brazilian market, and he said that the agency will correct distortions and ensure healthy competition. However, he made sure the audience understood that the more ways to distribute audiovisual content, the better.

The repeats on Brazilian programming grids in order to meet the quota imposed by the SeAC Law were also mentioned in a panel on content. “The repetition is of concern to all, but it is also part of the dynamics of pay TV,” said Fernando Medin, VP and Brazil country manager at Discovery. “I do not believe that any large channel is over-repeating. We all depend on the audience.”

Rangel believes that programmers need to keep investing in content of a greater value. “Ultimately, the loyalty of viewers occurs primarily through the quality of audiovisual works. The added value will have a longer cycle of operations in the market and it helps foster its development.”

Medin suggested a change in the law requirement that local productions cannot use foreign formats. “The momentum that these productions bring to the market is fantastic and positive for domestic producers. We will have several ‘first times’ and several opportunities to work and learn with these kinds of production.”

In response, Rangel said that foreign formats may promote international experience to Brazilian producers but the spirit of the law is to foster the generation of value. “These kinds of productions give good returns only to the holders of their formats.”

Camila Viegas-Lee is the editor of World Screen’s Portuguese-language publication TV Brasil.