Main trends and perspectives of AV markets in Peru, Venezuela and Colombia Research carried out by Germán Rey Media Observatory, Colombia * The information available to prepare this study has not always been desirably organized or up-to-date…

Peru, Venezuela and Colombia : Shared trends Tensions between “national” vs “foreign” affecting production distribution and exhibition of AV products; State and private sector participation in the AV industry; Marketing and commercialization of AV products; Changes in cultural & AV consumption patterns; A first trend involves relationships between national and foreign, own and outside, as expressed both in production processes, the industrial infrastructure of each subsector and opportunities for distribution and circulation of audiovisual product.

Tensions : national vs foreign Dominance of USA films in local screens (95% of films shown); Cinematographic diversity is practically non-existent in terms of geographical origin, and even in film genres, where Hollywood-style action films prevail. Most movies theatres concentrated in Lima, Caracas and Bogota; Domestic film production: an average of 4 feature films per year; Distribution channels concentrated in a handful of companies which control the film exhibition market. Dominance of USA films (95%); Movies from other countries are quite hard to find in commercial theaters, including those produced in Latin American. Each of the three countries averages no more than four movies filmed a year, which places them at a huge disadvantage compared to other industries, particularly the United States, which supplies most of the region’s cinema. The 3 coutries are seeking to set policies to encourage national production, creation, circulation of products in national and international theaters, participation of local efforts in international festivals, and international cooperation. Concerning the distribution of videos: in alll 3 countries there are major circuits for illegal distribution of videos, through street peddlers, who represent the most significant illegal market.

Tensions : national vs foreign TV segment shows higher levels of production with export potential (LA soap-operas - telenovelas - and mini-series); Relatively developed domestic industry, Low cost of programs, Television consumption traditions AV policies developed and implemented over the the last years Cable television programming is essentially foreign, with not-so-numerous local productions. Music industry Local music is important (salsa, baladas, boleros) Some “Indies” subsist side by side to majors; Industry devastated by piracy. Radio Extremely broad coverage, reaching even very remote geographical zones; Outstanding proportion of local programming & much of the music broadcasted . The most important television product in all three countries is telenovelas.

State and private sector participation in the AV industry Film sector: very limited private participation TV: important private sector participation Public, cultural and educational TV on the decline Radio: strong presence of private sector, with radio groups forming local networks and predominance of FM stations; Remarkable role of community radios Radio and TV laws include the creation of AV regulatory Councils or Agencies; In cinema, private participation is quite slim, and often creators themselves embark themselves in production adventures, usually losing plenty of money.

Commercialization of Av products TV captures higher percentages of advertising revenues. Venezuela : 60% TV vs 20% printed press Perú: 40% TV advertising investment Colombia: 62,2% TV advertising investment TV production generates revenues through telenovela exports in international markets International distribution of national films is deficient; producers often seek recognition in film festivals as an argument to sell in other countries A third trend involves processes of marketing audiovisual products. Domestic market do not have the capacity to completely absorb the amounts of investment required, for example, to make a 200-Chapter telenovela, although television in these 3 countries is the medium receiving the highest advertising percentages. Venezueala stands out with advertising investment of over 60% in television, versus a much lower percentage in the press. Peru has nearly 40% television advertising investment Columbia reached 62,2% in 2002.

Changes in consumption patterns of cultural & AV products “Culture comes through the media” : the most widely consumed cultural products are TV, radio and music products; Cinema consumption at its at lowest levels (moves from the public to the private space); Music in the main expressions of cultural consumption, mainly over the radio.

Challenges and opportunities The way forward Challenges and opportunities

Cinema A strong effort to be made in production distribution and exhibition Need a combination of private initiative and efficient participation by governments; Modern and updated legal frameworks and clear development policies (ie Colombia). Support is required for training, encouragement for young producers, directors and scrip writers; Exhibition: Need for policies that develop diversity, combining screen quotas with support to distribution of films from different origins; Necessary to deconcentrate the supply from capital cities

Television Digital technologies and the use of internet will renew the TV landscape in the coming years; Private companies are making efforts to consolidate their capacity in producing and selling their products in international markets (Especially Colombia and Venezuela); Essential to explore other genres than telenovela; Key : National production has an interesting future in these three countries, closely linked to strengthening production, seeking markets outside their domestic options, increasing quality and maitaining legal measures provided growth. FTAs and decisions in the WTO environment will be crucial.

Television Neccessity to consolidate Public TV (which is still weak in terms of identity and social impact); TV by subscription may grow if they diversify their supply and provide inter-media convergence services for users (e.g. broadband Internet Access); Challenge to regional and local channels which are central players in the 3 countries: they could interpret regional identities and contribute to developing decentralized television industries; Need to increase autonomy of TV Councils.

Radio and music Radio’s technological transformations, such as digitization and reception over Internet, will help extend its coverage and reach international audiences; Community radios still to play a key role; Music Face the piracy challenge; However, at the same time, there is a very rich and diverse array of musical genres with potential to expand to whole LA. Music is one on the cultural expressions people in the three countries identify most with.