In the Press
International Herald Tribune - Where the passion is hot and the marketers follow - July 12th, 2005
By Doreen Carvajal
Against all odds, four Argentine boarding school students - Manuel, Marizza, Pablo and Mia - yearned to perform in their own pop band over the 318 episodes of the television show "Rebelde Way."
But they never dreamed they would emerge as unofficial ambassadors for the globalization of the telenovela, the quintessential Latin American daily melodrama that grips viewers with Cinderella-like triumphs and all-conquering love.
For all their heartbreak and hand-wringing, contemporary telenovelas are not just prime-time fantasy but an international business model with the promise of revenue from CD sales, live concerts, product-placement advertising and merchandising that includes pencil cases and hair gel.
The dramas have ignited fierce competition between traditional Latin American telenovela powerhouses and new contenders from Russia, Israel and South Korea, which in some cases are willing to give away programs to television stations free to hook an audience with cliff-hangers.
"Rebelde Way," which has aired in almost 40 countries from Romania to Mexico, is a telenovela hybrid with credits spanning the globe. It is owned by a nine-year-old Israeli company, Dori Media, which started trading on the alternative investment market of the London Stock Exchange in March.
Dori made the show in Argentina to take advantage of low production costs and then sold the format rights in Mexico and India for versions with local actors. The original Argentine version aired with subtitles in Romania, Russia and Israel. This month, MTV Networks acquired rights to "Rebelde Way" for a version dubbed in German.
"Telenovelas are not a fad, and it's not something that is going away, because it has advantages," said Nadav Palti, chief executive of Dori. "It's a story where the good guys always win. It just takes time."
The roots of Latin American telenovelas date back to Cuban radio shows of the 1930s sponsored by U.S. soap manufacturers like Colgate-Palmolive and Gessy-Lever. Today's telenovelas differ from the American soaps in that telenovelas are a defined series of episodes that come to a climactic end. Aired during prime time with an average run of four months, shows can be made for as little as $18,000 an episode. The industry average is about $48,000 a show.
Globo in Brazil, Televisa in Mexico and Venevisión in Venezuela are longtime masters of the genre. But Dori is trying to make inroads by internationalizing telenovelas. The founder, Yair Dori, is an Argentine national who decided to introduce the concept to Israel in the 1980s and then expanded into co-production in Argentina during the economic crisis there in 2001.
Last year, Dori posted earnings of $1.8 million on $10.5 million in sales, and it is now making plans for an international strategy to conquer the world with love. Its goal is to give countries a taste for telenovelas - as it did in Israel - and then develop subscription channels dedicated to the genre, like Dori's Israeli channel, Viva.
A similar dedicated telenovela channel is starting this year in Malaysia on MiTV, with programming organized by Telefe International, an Argentine unit of Telefónica of Spain.
Eastern and Central Europe have emerged as ripe territory for telenovelas. Romantica, which is
owned by the British company Zone Vision, is a pan-European subscription channel that 24 hours a day beams largely Latin American fare to its core group of mostly female subscribers, who number 5.7 million and are concentrated particularly in Hungary, Poland and the Czech Republic.
The region is primed because historically, East European television stations with meager resources relied on low-price telenovelas to fill air time.
"After you start watching, you're committed for 150 episodes," said Kathy Fairbairn, the head of programming for Romantica.
"I see it very much as romantic fiction of television," she said. "And women have a need for the emotional involvement. It's escapism. It's fantasy. They can identify with the characters."
Romantica's programming is dominated by Latin American series like "Cuando Seas Mia" and "Rebeca," a show that allows viewers to vote on one of three possible endings. Fairbairn said the channel tended to avoid homegrown East European productions because Latin American shows were more generally accepted in a region divided into relatively small countries.
"If we take a Polish telenovela or Romanian, it's not going to work in other territories," Fairbairn said. "Latin Americans are more universal. The genre is quite well developed, and they also have extremely good-looking actors and very exotic locations."
That doesn't slow down the Koreans, who are so intent on cracking the East European market that they are willing to give away or discount programs with the expectation that ratings will take off and a payoff will come later.
Arirang TV in South Korea was so convinced that "All In," its show about a gambler and a love triangle, was a ratings winner that it offered free episodes to stations in Turkey and Macedonia. Ratings were tepid in Turkey, but the show will press onward this year in Romania, Serbia-Montenegro and Croatia, according to T.J. Kim of Arirang TV, who said the strategy was helping viewers become accustomed to Korean programming.
The discounts have prompted complaints from competitors, according to Anna Carugati, editor of World Screen, a 20-year-old trade publication that covers the international television market. But she said the most important trend in the market was that "major companies like Sony and Fremantle and Disney are either producing, co-producing or distributing novellas."
In Germany, producers have been trying out the telenovela concept. Fremantle International Distribution, a subsidiary of RTL Group, is now handling international sales of "Bianca," a popular show about a young woman who recovers her life after being imprisoned for a crime she did not commit. It was produced by Grundy UFA TV, which also made "That's Life" or "Verliebt in Berlin," which is based on the Colombian hit, "Yo Soy Betty la Fea" or "I Am Ugly Betty."
This year, Univision started broadcasting the Mexican version of "Rebelde Way" to Hispanic viewers in the United States. An average of 10.1 percent of Spanish-language viewers watched the afternoon show, according to the Nielsen rating service. In Mexico, the results were more dramatic: an average of 22.8 percent of Mexican households watched the show in prime time.
