Strong Latin American participation expected at Cable-Tec Expo 2009 in Denver
The CableTec Expo convention, hosted by SCTE, the Society of Cable Telecommunications Engineers of the U.S., has been for many years one of the major meeting points for the Latin American technology executives and advisors that follow as closely as possible the major technical developments concerning broadcasting, pay television, satellite delivery and telecommunications.
To the Latin American pay television industry, the Cable-Tec show is, with NCTA's Cable Show, the most important convention of every year; therefore, it doesn't come as a surprise that delegations from every major Latin American market and individual participants from the other territories convene at the show, this time in Denver, Co, on October 28-30.
Latin America has been one of the regions in the world that has best weathered the financial crisis of 2008, with some of its nations -Brazil, Chile, Peru, Colombia and Argentina among them- watching the local effects of the worldwide squeeze being increasingly balanced by the internal market in some cases, commodities exports in others. And, being television a business based more on expectations than on reality, the need to upgrade existing equipment and adhere to new technologies has not faded away; “cautious optimism” might be the right definition for the currently prevailing state of mind among many of the Latin American participants to attend the Cable-Tec Expo this year.
The upbeat attitude is reinforced in many cases by the drive towards local production at practically all the major broadcasters and many medium-sized outlets and independent producers: it happens that during the past five to ten years, regional and pan-regional distributors of Latin American programming have been able to open markets in Europe and Asia that accept the fare for usage in their countries but require high technical standards. Therefore, in many cases upgrades or the purchase of new equipment are justified by deals concerning other regions of the world. In the past three years, intra-regional trading deals have added momentum to the trend, with production facilities in Mexico, Brazil, Colombia and Argentina turning out fare that will be exhibited in the rest of the Americas. Hollywood studios such as Fox, Disney and Sony have joined this drive and spearhead or are partners in many of these ventures.
Digital TV, High Definition
The adoption of digital television patterns within the region has been somewhat slow and not always coherent. Brazilian President Luiz Inácio Lula da Silva, through diplomatic and commercial lobbying, has been able to convince Argentina, Chile, Peru and Venezuela about adopting Japanese standard ISDB-T, with some alteration requested by Brazilian experts and accepted by the original developers. Uruguay and Colombia have chosen DVB, while Mexico opted for the ATSC standard. With the exception of Brazil, where some broadcasters started with HD in December 2007 and the issue is hot among high-end pay television subscribers, the transition to digital and HD will be sluggish; the analog switch-off is being scheduled around 2020 if not later.
On the other hand, pay television -both terrestrial and satellite-delivered- thinks that high definition television may soon become a valuable marketing instrument. The perception is based on the growing sales of large-screen plasma and especially LCD television sets, even through the crisis; regional analysts believe that the owners of these (often expensive) receivers will soon become impatient about just watching the same scene on a larger screen. While a good portion of the programming being currently shot is already captured and processed by High Def equipment, there will be demand for compatible hardware concerning transmission, delivery and storage.
New outlets, Internet access
In addition, Latin America is watching the emergence of new broadcast and pay transmission outlets, sometimes related to digital television developments, as it happens with HiTV -a TV Azteca venture- in Mexico, or the launching of a HD version of Channel 13-Santiago de Chile through cable MSO VTR.
The 500-channel universe envisioned by the pay television industry about a decade ago is not coming to life exactly in the way it was expected at that time, but the digitization of cable television does offer opportunities, and many regional entrepreneurs are joining the fray with news channels from, say, Uruguay or Colombia. There is also additional room for specialty product such as travel channels -often sponsored by nations promoting tourism-, educational -such as channels by universities- and religious ventures.
It is interesting to observe that this drive towards more channels -technically, linear prepackaged programming- does not appear affected by the use of Internet as a means to distribute television signals. It is true that certain industry analysts believe that Internet-delivered television will at some time in the future capture a significant part of the entertainment market. But, until now the Internet access speeds in the region are not allowing a degree of image quality that can compete with plain television. On top of this, concerns about piracy regarding copyrighted content and about the exchange of huge files are working as efficient deterrents, too. As an example, Chilean VTR is offering to its Chilean Internet access subscribers a 15 Mbps service for some $64 per month, but restricts the amount of data transmitted to 50 GB; when the subscriber reaches this limit, the download speed is slashed to 1 Mbps until the end of the month or an additional payment that will allow 10 GB more of high-speed downloads. In Brazil, both Globo and Telefónica are testing high-speed Internet access services in selected areas of Rio de Janeiro and Sao Paulo cities. But, the service comes at a price. In Mexico, Megacable and more recently Telmex are offering 4 Mbps speed as its high end product. In Argentina, 2 Mbps to 3 Mbps is what most customers may obtain, and very often there are strings attached: the upload speed for such services is mostly in the 256 Kbps to 512 Kbps range.
There is no doubt that the Internet access providers are aware about these limitations and many of them would like to catch up with what is happening in Asia, Europe and, to a lesser degree, in the U.S. But they face the barrier of high interconnection costs, and this depends on the satellite and underwater cable industries. At the same time, certain governments are applying pressure to lower Internet access retail prices; in most cases, the vendors agree to increase the access speed without raising prices, but are reluctant to offer low-cost access. In Chile, Telefónica launched a package that offers free access to local websites and prepaid access to foreign sites. In Uruguay, the government is giving away laptop computers to every elementary school student. Still, to millions of Latin Americans the way to connect to the Internet is by stopping by at a “locutorio” -pay telephone and Internet access store- or a cybercafe.
