Sportel America – Wednesday’s (LatAm special) Miami wrap-up

18 March 2015 | Posted in SportsPro Blog | By David Cushnan | Contact the author

Sportel America – Wednesday’s (LatAm special) Miami wrap-up

IMG Media had a small contingent pacing the ballroom-cum-exhibition space in Miami this week, but, as usual, sport’s pre-eminent agency was a hot topic of conversation. 

Fuelled in part by IMG | WME co-chief executive Ariel Emanuel’s thoroughly entertaining appearance last week at SportsPro Live, much of the corridor gossip here was about the future of IMG’s international joint ventures. The subject came up during a fascinating session on Latin America’s sports broadcast market, steered expertly by TV Sports Markets’ Frank Dunne, on Wednesday afternoon.

IMG Media’s senior vice president of LatAm, Mexico and US Hispanic Felix Alvarez-Garmon took the opportunity to quash the longstanding speculation over the agency’s Brazilian JV, IMX, which IMG launched in 2011 in partnership with prominent Brazilian business leader Eike Batista’s EBX Group. Batista has since endured a torrid and dramatic fall from grace, which has seen much of his empire crumble. Alvarez-Garmon, however, insisted that with new investment from Mubadala, the Abu Dhabi investment fund, it is very much business as usual for IMX in its post-Batista era.

“With any joint venture, any partnership,” he said,  “you hope that both parties have equal say, equal weight and equal relevance. In Brazil, that was slightly different – obviously the personality of our partner at that time, Eike Batista, was very predominant; he was very relevant in certain circles. That was a very beneficial thing at the time of the launch of the joint venture.

"Since his demise, for lack of a better word, we’ve realised that we still have a very strong ongoing business and we’ve also realised that the business was our business, the events business, the sponsorship and, to a degree, media business and that obviously kept going through our involvement.”

Alvarez-Garmon added: “For us, in Brazil, everything we do tends to be a bit more for the long-term; it’s not opportunistic. You have a number of people who have come into Brazil and tried to reap the benefits of the World Cup and the Olympics, and then they’re gone. We’ve been there for at least 22 years – that’s how long I’ve been involved with it – and I hope there’s many, many more years of it.”

Pay penetration

The LatAm panel also featured the latest challenger in Brazil’s crowded pay television market. Esporte Interativo has been broadcasting, initially as a free-to-air service, since 2007, but truly came to prominence only in October last year when it secured the much-coveted primary package of Brazilian rights to the Uefa Champions League from the start of next season, entitling it to show every game live.

Two years ago, US giant Turner Group acquired a 20 per cent stake in the channel; in January, it took full control, joining the likes of Fox, ESPN, Globosat’s SporTV and the all-powerful free-to-air Globo in a decidedly-crowded sports broadcast market. Felipe Aquilino, Esporte Interatvo’s director of acquisitions, said he doubted the channel could have take the prized UCL rights, the bulk of which remain in the hands of ESPN until the end of this season, without Turner in its corner.

“It was a turning point,” he explained. Such is Globo’s dominance in Brazil, however, free-to-air still dominates, but Aquilino believes there is a “huge potential” in the country. “We started as a free-to-air channel, big on digital as well,” he said. “But moving to a pay-TV market – only 35 per cent of Brazilians watch pay TV. I’m pretty sure that in a couple of years our main source of revenue will be in pay-TV carriage rather than the current ad sales. Our whole business will change from now on.”

Telco or not telco

Whether it’s BT in the UK or Telefonica in mainland Europe, the emergence of telco operators as major players in sports broadcast rights bidding is one of Sportel America’s overarching themes: the phrases ‘triple’ or even ‘quad play’ have become part of the patter for any self-respecting delegate here in Miami.

In Latin America, America Movil made its entrance into the sports rights market by acquiring Olympic rights across the continent, excluding Brazil, back in 2013. It remains its most significant rights acquisition to date. IMG Media’s Alvarez-Garmon suspects more telcos may follow in the region, complicating matters still further in a hyper-competitive rights market. And when they do, he expects them to be swift about it.

“In a funny sort of way Latin America has always, not necessarily lagged behind the rest of the world, but been able to catch up a lot quicker,” Alvarez-Garmon noted. “Whether it’s in Asia or Europe, we see these things up there or out there, we look, we understand and then when we implement it locally we actually side-step various facets that they had to go through so we can get there quicker and sometimes more innovatively.”

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