Having fired up total revenues to €1.0 billion ($1.1 billion) in 2016, its biggest annual sales ever, Spain’s 27-year-old Atresmedia is looking abroad for further growth.
On Friday, the TV network group, one of Spain’s two largest, celebrated a 50 million overseas household reach for Atresmedia Internacional, its three-channel international bouquet beamed to North and Latin America (outside Brazil), the U.K., France, Netherlands, Switzerland and Australia.
That figure makes Atresmedia the non-U.S. operator with most subscribers in Latin America, as well as Europe’s private-sector broadcaster with most international channels, Atresmedia said in a statement.
Now it wants more. Currently, sales on Atresmedia Internacional stand at €13 million ($14.6 million) to €15 million ($16.9 million) a year, Javier Nuche, Atresmedia Diversification director general, said Friday at an Atresmedia cocktail at its H.Q. in the north Madrid suburbs. The goal is to double roughly that figure to €25 million ($28.15 million) by 2020, he added.
That may not seem huge incremental earnings. But as Nuche pointed out, since the three channels – Antena 3 Internacional, an international feed of Atresmedia programs; Atreseries Internacional, showcasing the group’s TV dramas; and celebrity/lifestyle service Hola! TV – broadcast largely already-created programming, profit margins are high. Atresmedia’s net income last year was €129 million ($145.2 million), EBITDA €202 million ($227.5 million). Judged by such bars, Atresmedia Internacional’s revenues take on a new relevance for the broadcast group’s bottom line.
Firing up its international reach, Atresmedia Internacional can benefit from several tailwinds. One is its recent growth, which is far from over. From September 2013, when Hola! TV launched, Atresmedia Internacional has quadrupled homes reach, Hola! TV, a joint venture with the magazine, now achieving an around 20 million household penetration in just four years. A new agreement in the U.S. will raise from 75% to 80% Atresmedia Internacional’s penetration of U.S. Latino cable packages, Nuche said.
Second, Atresmedia Internacional can look to the still-building market for cable TV in much of Latin America, not so much as its middle classes swell but as cable TV is made available to lower-income households at accesible prices, Dish Mexico’s Jorge Tatto said at the cocktail.
Then there’s Atresmedia Internacional’s offer itself. Its households and audiences have grown “hugely,” said Gabriel Pelerm Cruz, Liberty’s VP sales, media & marketing in Puerto Rico.
One reason:“Velvet” (pictured), the inspired Bambu Producciones-Atresmedia retro musical which persuaded Netflix to tap Bambu for its first TV series in Spain, “Las chicas del cable.” Production strategy at Atresmedia will not be set by its new international agenda. That said, like TV networks all over Europe, it is transforming from a broadcaster-content distributor into a content creator. Going forward, its original fiction ambitions are likely to grow, not decline.
Atresmedia is considering carrying third-party shows on its international channels, said Nuche. Netflix and other digital platforms could offer a news source of revenues, he added. In such a context, Spanish broadcast group’s main challenge looks likely to be competition for the key showrunner talent capable of really firing up audiences overseas in a new digital marketplace.