Telemundo-Univision competition gets `Ugly’

Jul 16, 2001  •  Post A Comment

Telemundo, the No. 2 player in the hot-as-salsa Spanish-language television arena, may go to court over the loss of “Betty La Fea” (“Betty the Ugly One”) and its sequel to bigger rival Univision.
Rights to “Betty,” the phenomenally popular telenovela that helped vault Telemundo past Univision in key time periods in large markets, were part of a recent output deal that Univision reached with Colombia’s RCN Television, the telenovela’s producer, which now is reportedly also shopping the English-language format rights to “Betty” in Hollywood.
Under the recent output deal, Univision will air “Eco Moda,” the sequel to the Cinderella story of the ugly secretary who wins her handsome boss, and will have the rebroadcast rights to “Betty” itself.
“I am frustrated,” said James McNamara, Telemundo’s CEO, who has been widely credited with turning the network’s ratings around to the point where it is perceived as a valuable acquisition target. “Let’s put it this way: Because we’re still looking into possible legal action, I’m not going to get into the details of how it transpired. But I am disappointed that the seller has entered into this arrangement with Univision.”
Citing lawyers’ constraints, Mr. McNamara declined to name the target or targets of a potential lawsuit, though they are obvious, and he declined to state the grounds of such a suit. Asked directly whether Telemundo itself believed it had options on “Betty” or its sequel that weren’t honored, Mr. McNamara said only, “Could be.”
On other, non-“Ugly” topics, Mr. McNamara was positive about Telemundo’s present and optimistic about the future of Hispanic TV.
Despite this year’s mostly underwhelming upfront marketplace, Hispanic-language TV continues to attract increasing dollars and new advertisers. “We are doing just fine [in the upfront],” Mr. McNamara said. “I think we’re going to be up 20 [percent] to 25 percent in terms of dollars, and our [costs per thousand] are going to be up.”
Last year, Telemundo had approximately 110 advertisers that spent about $175 million during the upfront, Mr. McNamara said. This year it expects to conclude the upfront with around 130 advertisers. “I think we’re going to do $215 [million] to $225 million,” Mr. McNamara said.
This year’s increases come mostly out of English-language TV ad budgets, he said.
Mr. McNamara pegged this year’s total upfront take for the Big 2 in Hispanic-language TV at $750 million to $800 million, with the majority of dollars going to ratings-dominant Univision. Nonetheless, the issue that unites both Telemundo and Univision, he said, is getting a more proportional share of the U.S. ad dollar.
Hispanic-language TV still gets only 1.5 percent of advertising dollars, he said, though it accounts for around 5 percent to 6 percent of the total viewing audience.
Despite the widespread speculation that Telemundo soon will be acquired by another media company, Mr. McNamara thinks Sony and Liberty Media, two of the owners of the privately held company, are not anxious to sell.
“The reality is … our owners are very pleased with the business, very pleased with the turnaround we’ve made,” he said. He confirmed that during the past 15 months “basically everybody,” with the exception of AOL Time Warner, has expressed an interest in Telemundo.
“I mean everybody,” he said. “Fox, Viacom, ABC/Disney, Telefonica, Televisa, TV Globo.”