Portugal Gears For First Private TV Web

Portugal is on the verge of awarding its first private tv licenses, which will probably mean the bowing of a new channel in early 1992.

The state-run Radiotelevisao Portuguesa, with two national channels, holds a monopoly on broadcasting.

Though two private webs have been authorized by the government, probably only one of these will receive a franchise.

A new commercial channel is considered to be an iffy proposition, since maintenance costs will be high and ad revenue modest when divvied among three channels. Only one new channel will be able to effectively cover the whole country, even if two are franchised.

Candidates must put up a guarantee of $3.5 million each. The government will then study the projects for three months. Once franchises are awarded, contenders have 15 months to start up broadcasting.

Observers here opine that initial startup capital required would be about $70 million, including cost of transmitters.

Four candidates

Of the bevy of earlier applicants for a private web, only four have remained. One is SIC, a group of newspaper enterprises (best known are O Jornal and Expresso) led by former Premier Francisco Pinto Balsemcao. Considered the prime candidate, Balsemcao, who is close to the ruling Social Democrats, is presently searching for a foreign partner (whose share may not exceed 10% of capital). Licenses will be awarded for 12 hours. Each Portuguese group’s share may not exceed 25% in a given channel.

Another newspaper group, Presslivre, is a distant second contender. Third group is Radio Renascenca, the Catholic radio network that is itching for a channel. A fourth possible is the multimedia Lusomundo group, already the major player in Portugal in theatrical distribution and exhibition and in homevideo, presided by Luis Silva. Lusomundo last year acquired the largest daily newspaper in Oporto.

Main snag in a new channel is the paucity of spot ads on television and the large overhead, which includes using the government’s ground booster network to transmit the signal. Some observers believe local cable tv stations would be more profitable than a national channel. Indeed, these may prove an alternative for those wanting to get into the tv game who are not awarded a franchise.

Tv revenue in Portugal presently totals about $75 million a year. About 30% of this comes from direct fees to household owners of tv sets. These fees are about to be abolished. The new webs would be limited to broadcasting 12 minutes of commercials each hour, and 10% of airtime would have to be produced in Portugal.

In addition, 50% of programming would have to be of “Portuguese expression,” which would include programming from Brazil. Remaining unclear is whether features and programs dubbed into Portuguese would qualify for the 50% quota, since at present all non-Portuguese programming is shown with Portuguese subtitles.

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