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BRAZIL | ABTA 2012  
Aftermath of the New Law
 
Will production cost less? Will content quality decrease? Will the middle class remain the leader in entertainment consumption? The debate reached fever pitch during the second day at ABTA 2012.
 
By SEBASTIÁN TORTEROLA, from São Paulo, Brazil.
Manoel Rangel, director-president of Ancine; Anthony Doyle, VP at Turner Brazil; and Paulo Saad, VP at Grupo Bandeirantes.
 
Those who believed Ancine's president and director Manoel Rangel would stay under the radar during the second day at ABTA with a calm misdemeanor -which was expected from the head of an organization that stands by the new pay TV law-, "were let down," said the executive himself during the "Impacts of the new regulatory framework" discussion panel.

Instead of addressing short-term issues, Rangel gave an outlook on the Brazilian telecommunication industry and its potential. He said TV's focus will veer from advertising to the consumer, predicting a 50% pay TV penetration by 2015 (30 million subscribers), and also spoke about the uncertainty still surrounding the new pay TV law (12.485).
 
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"The idea that content will lose its quality is mistaken. And it's mistaken because I have faith in the programmers' ability to choose the best content for their channels, as well as the operators' capacity to include the best products in their offers," he said, while also explaining pay TV's growth lays in the middle class' buying power, which "is far from running out."

At a certain point, tensions grew in the discussion panel, as Rangel addresses the requests Ancine is receiving to certify "qualified Brazilian networks" as the new law demands. The executive insinuated there might me channels that claim to abide by the minimum national content quotas, yet don't pass the organization's inspection. "What motivates us isn't papers, it's the truth: meaning, the quality of the service provided. That's why we'll proceed with the upmost rigor," he said.

ANSWERS
An interesting debate came about between programmers Anthony Doyle (Turner Brasil), Paulo Saad (Bandeirantes), Fernando Ramos (Globosat); operator Rodrigo Marques (NET Serviços) and producer Luis Antônio da Silveira (Conspiração Filmes), who discussed Rangel's statements. They all agreed on one thing: Ancine's deadlines to meet the law's many requirements are simply too short.

"The more I try to understand the law, the more doubts I get," said Doyle, stating that in order to launch a new channel, it must be imported, and such short deadlines makes it very complicated. "We must also address the money issue, and not think programmers must stay on top of the quality that's expected, and think about finding resources for it in the market itself, such as public funds (FSA)."

Meanwhile, Saad said: "The FSAs have never worked: they basically allow people to produce rubbish with government funds," he said, and added: "Though they have improved; and the goal is to do what independent producers do with them." There were several examples given, such as Nickelodeon's Julie and The Phantoms (currently airing on Band), as well as national film Elite Squad: The Enemy Within or TV series Preamar (HBO).

According to Saad, an important topic is "the quality in relation to the costs and economic scenario;" something which he disagreed with Rangel about: "Brazil's economic scenario is not as auspicious as it was last year, and the middle class' buying power is running out."

The executive also stated "production costs have doubled;" to which Silveira -as a producer- answered: "Production isn't more expensive since it's a fact that when the amount of production grows [in this case, due to the law], prices drop."

While Ramos affirmed all vehicles and nodes in the value chain are subordinated to the quality of content; which he believes must be taken into consideration, Rangel concluded: "Depending on the changes we see, we'll be as patient as needed. We are not keen on penalizing and pushing people. We have a long-term outlook on this: either we worry about the strategic aspects, or we get lost."


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