HBO, Omnivision Pact

Home Box Office and Venezuelan pay-tv company Omnivision have agreed to share 50-50 in the launch and operation of a Spanish-language pay-tv service in Venezuela. Service is expected to reach most of Latin America (excluding Brazil) and the Caribbean.

The venture, to be called HBO Ole, is planned as a 24-hour network featuring recent hit movies, sports, children’s programming and concerts.

The move catapults Omnivision, until now a local over-the-air service in nine cities in Venezuela, into a high-profile position.

Turner Network Television already provides Latin America with mostly foreign-originated programming (dubbed or subtitled into Spanish), but HBO Ole would become the first to provide such product without commercial interruptions.

At NATPE, Omnivision president Rafael Urbina and managing director Hernan Perez Belisario estimated that the “vast majority” of foreign programming acquired by the new service will originate in the U.S.

HBO Ole is expected to launch during the second quarter of ’91 on Pan-Am satellite throughout Latin America and the Caribbean – the same satellite used to beam such ad-supported services as CNN, TNT and ESPN. HBO Ole would become the first pay service on board.

Home delivery would be mostly via cable, but satellite masterantenna and direct-broadcast services to backyard dishes also will be used.

As when pan-European pay-tv services started up several years ago, U.S. studios will have to untangle current agreements with local Latin American pay-tv providers and theatrical, homevideo and free-tv sales agents to carve out a pay-tv window.

Unlike the complicated European situation, however, there are no significant programming quotas limiting foreign-produced shows on new services in Latin America and there is only one major language group to address.

Supplying the service will be Warner Bros. and HBO Intl., said Steven Rosenberg, senior v.p., HBO Intl. Discussions also are underway with other potential providers.

Sources said the partners are likely to spend between $50 million and $100 million to get the service up and running. That’s considerably less than the recently merged Sky Television and British Satellite Broadcasting individually spent to get their pay-tv movie channels operational two years ago in Europe, but it is in keeping with startup costs for French pay-tv service Canal Plus.

Subscription fee for the service probably will range between $8 and $15.

The company is HBO’s first venture into Latin America.

Omnivision operates from Caracas as a local pay-tv service and will continue its operating after the launch of HBO Ole. As a cable operator, it also will be offering programming on MMDS frequencies in Venezuela.

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