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A Global Producer Who Found His Right Path to Success - Broadcasting & Cable

A Global Producer Who Found His Right Path to Success

Televisa CEO Emilio Azcàrraga Jean, whose career was forged in crisis, has built the company into an international programming powerhouse
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For Grupo Televisa chairman and CEO Emilio Azcárraga Jean, the road to getting this year’s Brandon Tartikoff Legacy Award reached a turning point in 1997 with the sudden death of his father, Emilio Azcárraga Milmo.

Founded in the 1950s by the Azcárraga family, Televisa was a powerhouse in the Mexican TV industry and Azcárraga Jean has worked in the family firm since 1989, but he was only 29 when he took charge of Televisa after his father’s passing and found himself charged with guiding a firm that was suddenly in danger of financial collapse.

“The foundations of the company were pretty strong but the financial situation was very bad,” Azcárraga Jean recalls. To address that, Azcárraga Jean quickly moved to cut expenses, sell off non-essential assets and strengthen the company’s focus on its content.

Through the several years that followed, those efforts, combined with increased pay-TV investments, would lay the foundation for a remarkable turnaround. Televisa’s content sector, which includes broadcast, pay-TV networks and its program export and licensing business, has nearly doubled from 17.7 billion Mexican pesos ($1.33 billion at current exchange rates) in 2003 to 32.9 billion pesos ($2.48 billion) in 2012.

Meanwhile, its cable, telecommunications and satellite operations hit 30.1 billion pesos ($2.27 billion) in 2012, way up from 11.0 billion pesos ($830 million) in 2007. Overall, Televisa has about 70% of the broadcast market in Mexico and it serves 56% of the country’s pay-TV subs.

Much of this has been built around the company’s extremely successful production and programming efforts. While Televisa is best known for its telenovelas, which are hugely popular around the world, it also creates a wide array of other programming. “What we have been doing in the last 17 years as a production powerhouse in broadcast is to adapt that production of content to different platforms, first to cable and then satellite and now to the Internet,” says Azcárraga Jean. “That helped us to overcome the financial issues we had in 1997 and turn the company into one of the largest producers of content in the world.”

Those production and programming successes are one reason why Azcárraga Jean so richly deserves the Brandon Tartikoff Legacy Award he will receive at this year’s NATPE convention, says Randy Falco, president and CEO of Univision Communications.

“I had the very good fortune of knowing Brandon and saw !rsthand the influence he had on the TV industry,” Falco says. “I liken the great impact that Emilio has on Mexico, the U.S. and around the world to what Brandon achieved. Televisa is a worldwide leader in content because of Emilio’s vision and commitment to audiences.”

Looking forward, Azcárraga Jean is applying that same commitment to the U.S. market, which is particularly important for Televisa’s future, according to its CEO.

Televisa helped found operations that evolved into Univision in the 1960s and it has supplied programming to the network for many decades. The relationship grew contentious, however, in the mid-2000s when the two companies went to court over the programming deal and Univision was sold to Haim Saban and a group of private equity investors.

But a 2010 agreement resolved those disputes and laid the groundwork for an even closer working relationship. As part of that deal, Televisa agreed to invest $1.2 billion in Univision for a 5% stake, which could be increased in the future, and its exclusive programming agreement was extended with higher royalty rates. In 2013, Televisa expects to get $270 million in royalties from Univision, up from $138 million in 2007.

“Just in the last three years, we have added a total of nine new Spanish [language] networks and that wouldn’t have happened without Emilio’s vision and support,” says Falco. The strengthened alliance has also allowed Univision to expand their digital and online efforts and push into the English-language markets with Univision’s joint venture with ABC for the Fusion Network and its partnership with Roberto Rodriguez for the El Ray Network.

Beyond his work in the industry, Azcárrago Jean has other concerns that get the bene!t of his great commitment. “Like Brandon [Tartikoff], Emilio is passionate about giving back,” Falco says. The Televisa Foundation has long been active in a number of causes, including a long-running effort to help children recover from serious illnesses and disabilities, which has funded 23 rehabilitation centers. In 2012 that work was expanded to the U.S., with a telethon on Univision that has raised some $30 million in the last two years.

Azcárraga Jean also stresses that they regularly use their popular telenovelas to promote environmental or social causes. “We’ve learned that you can work with the writers to put issues into plots without losing ratings,” he says. The gains, of course, are immeasurable; then again, Azcárrago Jean has made a career out of !nding a good route to a winning course.

TELEVISA: AT A GLANCE

Revenue (2012): 69.3 billion pesos ($5.2 billion)

Revenue by sector (as of Q3, 2013): Advertising 33%, cable and telecom 23%, Sky 21%, licensing and syndication 8%, network subscription revenue 5%, publishing 4%, other 6%

Assets:

Broadcasting: Mexico’s largest broadcaster, with four major networks

Pay-TV programming: 22 pay-TV brands reaching 36.8 million homes worldwide.

Program and syndication production: Created more than 90,000 hours of programming and exported content to over 50 countries in 2012.

Cable: Mexico’s largest cable operator, with 2.5 million video subscribers, 1.6 million fixed data subscribers and 871,000 voice subscribers.

Satellite TV: DTH platform Sky (59% owned by Televisa and 41% owned by DirecTV) has 5.9 million subscribers.

Publishing: 197 titles with a circulation of 30 million in 20 countries.

Source: Televisa company reports. Data is for third quarter of 2013 unless otherwise indicated.

For Grupo Televisa chairman and CEO Emilio Azcárraga Jean, the road to getting this year’s Brandon Tartikoff Legacy Award reached a turning point in 1997 with the sudden death of his father, Emilio Azcárraga Milmo.

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