“The market tends to concentrate, small operators must create alliances”

José Luis Jacquet Matillon, CEO of El Cuatro, a pay TV operator from Jujuy, in northern Argentina, participated in the recent edition of NexTV CEO Latin America, where he offered his vision on new opportunities in pay TV and stressed the need to partner with other small operators to face the high costs and new challenges.
According to the executive, the key for an independent operator to compete with big players is to offer “efficiency and excellence”. In this context, he indicated that “cost efficiency and improving profitability in order to face investments” is important, as well as “improving response time” and offering “a very good service”.
Jacquet Matillon said that operators must generate flexible business proposals, with products that can be contracted separately and in bundles.
However, the executive considered that the offer of pay TV signals has been concentrated and “this gives little choice to small cable operators that have limited bandwidth to offer more signals in their networks, and the TV networks are always pressing to include more channels packaged, but the network has a limited capacity”.
“The market tends to concentrate; small operators must create alliances, increase the negotiation power and reduce the costs of implementing new technologies.”
According to the executive, suppliers must understand that the way is to stop charging a lot to a few operators but go to start charging little to more companies. “The offer becomes very wide and the client does not have the capacity to buy all the products. It is necessary to generate added value and avoid the search for alternative solutions. Today there are very low-cost pirated products that become the space in which customers go when they cannot access services because of the high value involved.”
“We should ask ourselves if the suppliers have understood the new complexity of the business and if they take into account that the operator is their sales force, it is a joint venture,” he added. The executive pointed that there are new costs related to the installation of the set-top boxes, the wiring and its connection to the Internet. In addition, “VOD services have expanded the bandwidth consumption; providers are not offering local caches to minimize these costs, which are paid by the operator. Costs are growing significantly and there is no understanding on this issue by operators, which claim a charge for each consumption option that is offered to the subscribers without taking into account the costs of the new complexity of the business.”
Regarding the OTT offer, Jacquet Matillon indicated that these services should be integrated into the cable operators’ offer and add the local sales force and the knowledge of the customers. In turn, operators can be empowered by participating in the sale of their products and they can grow in number of customers. “Today they are the only ones that are offering local caches to collaborate in the reduction of the costs that the consumptions of contents VOD implies”, he concluded.