During an interview with Nextv News Latin America, Bruno Pruneda, General Manager at the Mexican DTH StarTV, expressed himself on the main challenges of the pandemic for the company and for pay TV consumption in Mexico; as well as the recent start of StarTV’s operations in Mexico City (CDMX); the plan to continue strengthening the company’s offering with new OTTs and programming packages; and the challenges ahead for the industry in Mexico and the rest of Latin America.
What challenges has the pandemic set in terms of TV content consumption on StarTV, as well as at the day-to-day level of the company?
2020 and the beginning of 2021 have been full of challenges and contrasts, and StarTV has not been an exception. In March 2020, as we all know, we began a hard social distancing period in Mexico, which kept us in our homes. At first, the measure led pay TV to become a key element of entertainment for all families who were at home. Children’s and news channels had a significant audience growth and our sales improved by 5%.
Unfortunately, over the months, the temporary or permanent closure of many businesses led Mexican families to decrease or lose their income, and this brought us a hard blow, not only on our sales (new customers), but also to reduce the churn of subscribers who were already within our satellite TV platform. We are currently living a very difficult time and, at least for the first six months of 2021, the situation will be similar. Customers who stay active are trying to move down from an extended package to one with the basic contents.
Days ago, StarTV announced it has started operating in Mexico City (CDMX), since last March 1. What are the objectives of the company in that region?
We will go calmly and step by step. Mexico City is highly contacted via fiber (FTTH), where double and triple play are essential, so we will focus on rural areas and further away from the city, areas that fix with our market niche and the type of technology we have. Likewise, in fiber areas (FTTH), we will also have a certain opportunity for households with double play (telephony and internet) to join StarTV as a complementary offer, and save money.
In which Mexican regions is StarTV currently operating? Are there any intentions to continue expanding the company’s operations in the future?
We are already throughout the country and available in 82% of Mexican municipalities. Our aim now is to strengthen the areas with less penetration of our brand. Another one is to find new distributors for the north of the country, where we have States with a large amount of territory, and very small, remote and poorly communicated rural communities.
One of the bets that StarTV is implementing has to do with adding OTT platforms to its offer. Is StarTV working in negotiations to add more SVOD OTTs to its programming packages?
Yes, continuing adding OTTs will be a key issue for StarTV. We are holding conversations to add another sports OTT, strengthen the SVOD Premium offer and add other platforms with more Mexican content. Although DTH technology is focused on bringing pay TV to poorly connected communities, we cannot ignore the way in which content has been consumed for some years.
How are the StarTV programming packages made up? The most recently launched is Supernova Kids, with 80 channels, and access to content from Noggin and Stingray. Is StarTV planning to add new packages to its content offering?
Within our sales levels and our target, it has been a success. By combining linear packages with platforms, we tripled their sales and accesses. I think Viacom should be very proud with the results with Noggin, so on April 5th we added the same idea, but now with Paramount+ in a new package called ‘Universo Platino’, which will allow clients to access to all Premium SVOD platforms, as well as HBO and Star (formerly Fox) linear channels.
Are there any intentions for StarTV to partner with Internet Service Providers (ISPs) in order to offer broadband to its subscribers?
Without a doubt, it is something we have been looking for, we are close to Altan Redes and some other internet providers. I hope something can be done in 2021.
According to your view, what are the main challenges that the industry will face in the coming years in terms of pay TV operators in Mexico and the rest of Latin America?
I will be direct and a bit critical with channel owners and their affiliate sales areas. They must help us to continue growing together. For more than 30 years, pay TV operators in Mexico and Latin America have given them great income through the rates we pay them. Today, with the launch of their SVOD platforms, we need three key elements: joint synergies with these SVODs, that channel owners strengthen them with better content (fewer channels but stronger ones), and that they reduce advertising in spots within these to improve the ratings. I am not asking them to stop selling advertising, but for it to be only for an integrated product and not for spots that break content, or for infomercials that last 2 or 3 continuous hours.
Today, it would be fair for the price an operator pays for linear channels to decrease. The launch of its own OTT platforms and the rating drop in linear consumption fully justifies it.