Televisa Expects Big Increase in Univision Royalties

1:49 PM PST 02/21/2014 by John Hecht
Stephen Lovekin/Getty Images for Univision
Univision CEO Randy Falco

The Spanish-language content producer said it expects fees from the network to reach $350 million this year.

MEXICO CITY -- Televisa, the world's largest producer of Spanish-language content, on Friday said it expects programming royalties earned from Univision to soar to $350 million this year.  

Televisa provides the bulk of primetime content to its U.S. partner Univision. In 2013, Televisa earned $273 million in royalties from Univision, and the number is set to increase as the network adds more content.

Televisa sees the U.S. Hispanic market as its most attractive growth opportunity. The company already dominates Mexico's broadcast and pay TV, with estimated 70 and 60 percent market shares, respectively. However, pending telecom and TV reform legislation is likely to cut into profits this year as the government pushes to open the industries to competition.

Under the reform, networks are required to offer their broadcast TV channels free of charge to pay TV outfits, meaning the television duopoly of Televisa and TV Azteca can no longer profit from selling those channels to competitors. Additionally, the government plans to tender two licenses for digital TV, which allows new players to crack the market.

Televisa is also boosting film production and distribution in the U.S. under a partnership with Lionsgate, dubbed Pantelion. Targeting Latino audiences with bilingual films, Pantelion calls itself the "first Latino Hollywood studio." Last year's release of the Eugenio Derbez comedy Instructions Not Included became the highest-grossing Spanish-language film of all time in the U.S.

 

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