TV Europe DISCOP 2011

DISCOP EDITION

Special Report:Novelas in

Eastern Europe

THE MAGAZINE OF EUROPEAN TELEVISION JUNE/JULY 2011

TVN Group’s Markus Tellenbach

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Caracol Television experienced a considerable increase indemand for its productions in Central and Eastern Europelast year, reports Camila Reyes, the sales executive for theregion. “We believe this is based on Caracol’s constantgrowth and success throughout the last few years, both inthe Latin market as well as on the international arena.”

At DISCOP, highlight offerings include the series TheWitch, about a school teacher who finds she has mysti-cal powers, and Yellow Team, focused on a group of cab-drivers. Reyes is also looking forward to talking to herclients about Caracol’s new co-production with SonyPictures Television, Love and Fear. The English Teacher isa new telenovela that Caracol is showcasing at themarket. Rounding out the list of highlights is the dramaseries Confidential.

• The Witch• Yellow Team• Love and Fear• The English Teacher• Confidential

The EnglishTeacher

Caracol Televisionwww.caracolinternacional.com

“We believe DISCOP will be a great platformfor us to create new demand, close new dealswith our current customers and increase theinternational awareness of our productions.”

—Camila Reyes

A division of the Argentinean media conglomerateGrupo Clarin, Artear built its international sales businesson the back of novela hits like Gypsy Blood. But the com-pany has been letting buyers around the world know thatit has much more to offer.

New at DISCOP is the 26-part series The Social Leader,about a community activist. Artear will also continue toshowcase the series Left on the Shelf, about three spinstersisters who lean on each other following the death oftheir harsh mother, and Be Kind to Me, about a couple’sstruggles to stay together after 22 years of marriage.

On the unscripted end, meanwhile, Artear has the 13-part documentary Methods, charting the creative processesof artists, musicians and writers, and Tasting Notes, with 57half-hour episodes entirely focused on the world of wine,hosted by the Argentina Sommelier School’s director,the renowned expert Marina Beltrame.

• The Social Leader• Left on the Shelf• Be Kind to Me• Methods• Tasting Notes

Artear

The Social Leader

IN THIS ISSUE

Novelas Flying HighLatin Americannovelas remain strong across CEE 6

InterviewsTVN Group’sMarkus Tellenbach 14CME’s Adrian Sarbu 20

www.artear.comLeft on the Shelf

by visiting www.tveurope.wsGet daily news on European television

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4 TV EUROPE

With its broad catalogue, Imagina International Sales coversa wide range of genres for the buyers at DISCOP. “Highproduction quality, original concepts and great audiences inSpain make it easy to choose from [our productions],” saysBarbora Susterova, sales executive. Leading off the slate is TheBoat, which Susterova describes as “a mixture of adventure,mystery and drama, set on a 70-square-meter deck of a boat.With an average of 20-percent share [in Spain], this originaland brand-new concept makes the series attractive to manybuyers across all Europe.” Imagina also has high hopes forErmessenda: The Queen of Kings, a historical drama. Fish &Chips is a game show, while 25 in 25 is a quiz show. Otherhighlights include the clip series The Gonzalez and the fea-ture film 3 Meters Above the Sky. “Imagina International Saleshas established contact with most of the CEE buyers duringits existence; we are working with TV channels directly aswell as with production companies all over the world.”

• The Boat• Ermessenda: The Queen of Kings• Fish & Chips • The Gonzalez• 25 in 25

The Boat

Imagina InternationalSales www.imaginasales.tv

“The goal for this market is to establish newcontacts, strengthen existing relationshipsand promote our catalogue in each one ofthe territories.”

—Barbora Susterova

• The Power of Destiny• With You, Without You• Double Life• Little Giants• Legacy of Revenge

Televisa Internacional

A prolific provider of telenovelas to Central and EasternEurope for years, Televisa Internacional has recently foundsuccess in the region with an entirely different genre: lightentertainment. Its variety format Dancing for a Dream hasbeen adapted in several markets, including Romania, whereit is in its eleventh season. Televisa hopes to follow up that success with Little Giants,

another variety format, this one focused on talented kids.“This will be one of our big bets at DISCOP,” says ClaudiaSahab, director for Europe. “It’s a big entertainment formatfor prime time. It’s great for the whole family. The [ratings] inMexico have been amazing—every week it’s growing.”The novela, however, is still Televisa’s bread-and-

butter business in CEE, and Sahab will be showcasingThe Power of Destiny; With You, Without You; and Legacyof Revenge, among others. She will also be introducingDouble Life.

www.televisainternacional.tv

Little Giants

“We are very enthusiastic. For us, DISCOP hasalways been a great market; we have time to be withclients, to get to know what their needs are.”

—Claudia Sahab

Ricardo Seguin GuisePublisher

Anna CarugatiEditor

Mansha DaswaniExecutive Editor

Kristin BrzoznowskiManaging Editor

Morgan GriceEditorial Assistant

Simon WeaverOnline DirectorPhyllis Q. BusellArt DirectorCesar Suero

Sales and MarketingManager

Terry AcunzoBusiness Affairs Manager

Alyssa MenardSales and Marketing

Coordinator

Ricardo Seguin GuisePresident

Anna CarugatiExecutive VP and

Group Editorial DirectorMansha DaswaniVP of StrategicDevelopment

TV Europe© 2011 WSN INC.

1123 Broadway, #1207New York, NY 10010

Phone: (212) 924-7620

Fax: (212) 924-6940

Website: www.tveurope.ws

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At the heart of almost every good telenovela is a story ofstruggle and redemption. So it’s fitting that the companiescharged with selling these Latin American soap operas haveencountered their fair share of obstacles—and have emergedunscathed. The genre has managed to secure inroads acrossAsia, the Middle East, Africa and much of Europe, and whileit may occasionally fall out of style, the novela has provento be a resilient programming staple on broadcasters acrossthe globe.

Central and Eastern Europe (CEE) is no exception. Sincefirst taking hold in the region’s early days of commercialbroadcasting, when new channels were anxious for cost-effective content, the Latin American telenovela has remainedon local buyers’ wish lists, both as completed programmingand as formats.

“Last year we saw huge growth in [our business in]Europe,” reports Claudia Sahab, the director for Europe atTelevisa Internacional. Stressing the production values of


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Despite stiff competition, Latin American distributors are still finding avid interestin telenovelas across Central and Eastern Europe. By Mansha Daswani

Telefe’sSuperclumsy.

Novelas

Flying High

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Televisa novelas, Sahab notes, “In some cases there were twoor three clients competing for the same title.”

Having secured first-option output deals in virtually everymarket in CEE, Televisa has recently inked second-optionpacts with networks in Croatia and Hungary, a trend Sahabis optimistic will continue. “There are more channels now;almost all the main channels have smaller DTT channels.They will need more content. For us, that’s good news.”

THE COMEBACK KIDAdela Velasco, who handles sales to Europe and Africa atComarex, is similarly upbeat. “These regions are all movingback again to acquiring and broadcasting telenovelas, whichof course is our ‘star’ product,” she says. “We are fortunate tohave [had] a constant presence in this region.” She lists theAzteca novelas Morena and Daniela as among the company’shits in this part of the world. “These novelas, with theirunique scripts, offer universal themes such as family values,love and revenge, which people can identify with. Audienceslove the romance and intrigue.”

Nevertheless, it’s been a challenging few years for content sell-ers of all stripes in CEE, with the downturn in ad budgets hav-ing put the squeeze on broadcasters’ programming spending.

Michelle Wasserman, the head of international sales, pro-gramming, formats and international production services atTelefe International, concedes that there has been a slowdownin the acquisition of completed telenovelas in some EasternEuropean markets. “They are still buying from us, but not asmuch as they were in the past,” she says.

Televisa’s Sahab says that the genre has been absent from theCzech Republic for several years, and she’s eager to crack themarket again with a DISCOP slate that includes The Power of Des-

tiny; With You, Without You; Legacy of Revenge; and the upcomingDouble Life, which launches in Mexico on Televisa’s flagship ter-restrial channel this summer. History has shown, Sahab says, thatthe novela is more than capable of making a comeback.

“Hungary has been incredible. The telenovela genre wasout of the market for about four years. For the last two years,you can’t imagine how [much] we have been growing there.We started with pay TV, from there on other [broadcasters]started to see that the telenovela was successful. So they startedto demand our products, and now we’re all over Hungary.”

Hungary is also on Caracol Television’s hit list of growthopportunities in the region, says Camila Reyes, sales executivefor CEE at the company. Poland, Romania and the CzechRepublic are also territories she’s targeting, while buildingon a strong business in Serbia and Bulgaria.

“We have seen a considerable increase in demand for ourproducts,” Reyes says, listing hits like The Cartel 2, Mafia Dolls,Family Secrets and Mariana & Scarlett. “We believe this is based onCaracol’s constant growth and success throughout the last fewyears, both in the Latin market as well as in the internationalarena. Also, the high quality of our productions, our world-renowned cast and the high profile production partners withwhich we collaborate, such as Sony Pictures [Television], are justsome of the factors that have contributed to this increase.”

Globo TV International has clinched a number of deals inCEE recently, including on the new version of the telenovelaThe Clone, which was picked up in Lithuania on TV3, TV4 inHungary, Pink TV in Slovenia and Serbia, TV Puls in Poland,and RTL in Croatia. India: A Love Story aired this year on MTVin Hungary, Mreza Plus in Bosnia and BNT in Bulgaria. Newnovelas from Globo at DISCOP include Cat’s Cradle, Writtenin the Stars, Passione and The Buzz.


Lady in waiting:Love and Fear, a co-production withSony Pictures Television, is among Caracol’snovela offerings for DISCOP.

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A passionate period: Band is showcasing its lineup of Braziliancontent, including the telenovela Forbidden Passions.


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While celebrating CEE’s renewed verve for novelas, LatinAmerican content sellers are keeping a keen eye focused onthe new competition—notably daily dramas from Turkeyand, to a lesser extent, at least for now, Korean soaps.“There is a high demand for Turkish series, which are very

successful, especially in Kazakhstan, Bulgaria and Macedonia,”says Melissa Pillow, the sales director for CEE at Tele mundoInternacional. “These series are not labeled as tele novelas;however, the broadcasters consider them similar to the tradi-tional Spanish-language counterpart. These series are not newand have been on the market for more than two years. How-ever, in the past year, broadcasters in more countries, such asHungary and Croatia, have begun experimenting with them.These series do not seem to be replacing the slots of theSpanish-language titles. However, we are seeing that the timeslots have been moved in some cases to make room for theTurkish series as well.”“There is no small competitor,” asserts Televisa’s Sahab on

the rise of the Turkish soap. “We have to be very consciousabout this. We are paying a lot of attention to what they’re doingand how they’re doing it and why those titles are working.”

SURVIVAL OF THE FITTESTFaced with new competition, Latin American distributorsare employing a variety of methods to keep their CEE busi-ness on track. Comarex’s Velasco stresses the need to deliver“quality content with new and innovative themes thatengage audiences.”The DISCOP lineup includes the Azteca novelas Empress,

Within My Soul and Under a Red Sky. “We are expecting tosecure good deals, finalize sales, network and establish con-tacts [with] the new DTT and cable channels,”Velasco says.Caracol will be showcasing the Sony Pictures Television

co-production Love and Fear and The English Teacher, amongothers, at DISCOP. Flexibility is important, as is the ability

to offer up both a canned production and a format, saysReyes: “We focus on providing clients with exactly what theyneed. Each territory is different and, according to budgets,production capabilities and many other factors, we helpclients acquire what fits their need best. Either it is the fin-ished products or the format rights.”Indeed, it’s the format market in CEE that has proven to be

particularly lucrative for Telefe, reports Wasserman. “The request for the formats had been growing a lot while

the ready-mades have been on hold for a while,” she says. “Wehave just produced The Successful Mr and Mrs Pells for Russiaand are now getting into the adaptation of A Year to Remember.We are still working hard in Hungary; we are doing a lot ofdevelopment in Poland. We are starting preproduction for TheSuccessful Mr and Mrs Pells [in Poland], and we are in the adap-tation process of Don Juan and His Fair Lady. We have moreprojects in terms of production rather than ready-mades.”There are, however, several completed productions that are

generating business for Telefe, including the teen-targetedseries Superclumsy and TeenAngels.Telemundo also emphasizes its ability to offer both com-

pleted programs and novela formats. “However, in most ofCentral and Eastern Europe, sales of completed telenovelasare still our main business,” says Pillow. “Our title Beauti-ful but Unlucky has aired all over Central and EasternEurope in the past year, and has been an absolute hiteverywhere it has aired, especially in Bulgaria, Serbia,Croatia, Romania and Lithuania. Other news has been theimmense success of Marina in Hungary on the nationalbroadcaster TV2, where the title achieved shares of 28 percent.

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Cutting through clutter: Among the shows being sold by Artear is Gypsy Blood.

Lady in red: A long-time distributor to CEE, Comarex heads toDISCOP with Empress.


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Elena’s Ghost began launching all over Central and EasternEurope last fall, including in Albania, where this teleno -vela beat a very popular telenovela in the same slot on acompeting channel, and in Serbia, where the telenovelagenerated a share of more than 15 percent on Prva, attract-ing even a large male audience. Finally, our successful co-production with [TV Globo], The Clone, has proved to bewell loved by audiences in Central and Eastern Europe,most recently in Croatia, Bulgaria and Poland, where thetelenovela gained shares well above those traditionally gen-erated by the genre.”

THE NEXT STEPWith a slate that includes the U.S. hit The Queen of the South,along with My Heart Beats for Lola Volcan and Behind ClosedDoors, Pillow is keen to consolidate Telemundo’s business inRomania, Serbia and the CIS countries, while also pursuingnew growth areas. “Now that the crisis is subsiding and ad mar-kets are growing once again, we see opportunities for growthin Russia’s format market, where broadcasters are once againsoliciting production of new series instead of relying on theirlibraries. Another area of growth is in the digital-media mar-ket of Central and Eastern Europe, where our digital-mediadepartment has been closing numerous small but interestingdeals with channels that now actively want to operate VODand IPTV platforms.”

Sahab at Televisa sees co-productionsin CEE as being a potential futuregrowth area, but she doesn’t expectthat the business will really maturefor another few years. “We’re talkingwith some of our main clients aboutit. We are willing to co-produce.We’re starting in Western Europe butwe will come to Central and EasternEurope as well.”

What has boosted Televisa’s busi-ness in CEE is its ability to offerlight-entertainment formats. Dancingfor a Dream has been adapted across theregion, including in Romania, whereit’s in season 11. Sahab sees big thingsahead for the new show Little Giants.“I think this could be the secondgreat entertainment format successfrom Televisa.”

Bandeirantes CommunicationGroup sees its hook as being able toreflect Brazil’s “exotic and coollook” to the world, says Elisa Ayub,the director of international contentat Band TV International. “In someways, our culture, our landscapes areso different from Central and EasternEurope, and that makes our produc-tions so much [more] interesting. Ourtelenovelas and other TV shows offera [distinctive] kind of innovation.”

Band will be offering at DISCOPthe telenovela Forbidden Passions,adapted from a work by Portuguese

writer Camilo Castelo Branco, along with a mix of come-dies (Angels of Sex), reality (The League) and more.

Globo will also have a diverse portfolio, complementingits lineup of novelas with the drama series Starting Over Againand Miracle Hands, the mini-series Fifties Club, the nine-partGloboDOC and even some kids’ specials.

Artear, meanwhile, has the novela Gypsy Blood to offer upto broadcasters, along with the series The Social Leader, Left onthe Shelf, Be Kind to Me and More Than Partners; and the fac-tual shows Methods, Tasting Notes and Fantastic Biographies.

Across the board, distributors appear upbeat about their out-ing to DISCOP this year. “For us, it has always been a great mar-ket,” says Televisa’s Sahab. “Even though in some years there werefewer people, the quality of the meetings [has always been]really good. We have time to be with clients, to get to knowwhat their needs are. It’s really useful for us. And for them, too.”

Wasserman says she is keen to “introduce our new shows,especially to the stations that didn’t go to MIPTV. We havehigh expectations especially for The One, Superclumsy and AYear to Remember. We expect to consolidate the relationships[we have] and to try to make adaptations of the new seriesin European markets.”

Caracol’s Reyes says, “We believe DISCOP will be a greatplatform for us to create new demand, close a series of newdeals with our current customers, and increase even morethe international awareness of our productions.”


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Man of the hour: Televisa’s top property for DISCOP isThe Power of Destiny.


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Poland is arguably the most dynamic of the media markets inCentral and Eastern Europe. All have experienced rapid growthsince deregulation began in the ’90s, when foreign investmentpumped in by Western companies ignited an entrepreneurial spiritthroughout the media sector, but Poland has demonstrated agreater vibrancy than other countries. Among the very early Polish entrepreneurs were Jan Wejchert

and Mariusz Walter, who in 1984 founded the ITI Group, one ofthe first privately owned companies in the country. ITI initiallyconcentrated on the consumer-electronics import-export busi-ness, then set up an advertising agency and home-video opera-tion, and later diversified into the snack-food business. Butbetween 1995 and 2002, ITI divested itself of all nonmedia activ-ities. In 1997, it set up the commercial station TVN, which

quickly became the market leader in Poland.TVN24, Poland’s first all-news channel, followed in2001, and in rapid succession the TVN Grouplaunched other free-TV channels, including TVNMeteo, TVN Turbo, TVN Style, iTVN (for Poles liv-ing abroad) and TVN CNBC Biznes, developed incooperation with CNBC.The success in the free-TV arena spurred the

TVN Group to make its foray into pay TV—in 2006the N platform was launched and today offers seventhematic packages—and into new media, whereOnet.pl is the leading Polish Internet portal.Markus Tellenbach joined the TVN Group in

2009 as president and CEO, having previously beena member of the TVN supervisory board. He hasalso been CEO of SBS Broadcasting, managingdirector of the German TV station VOX, and, sinceJuly 2010, the deputy chairman of the supervisoryboard of Sky Deutschland AG. Tapping into hisextensive experience in both free TV and pay TV,Tellenbach now oversees TVN Group’s three majorbusinesses: television broadcasting and produc-tion, digital satellite pay TV, and online. He talksto TV Europe about the strategies that have madethe TVN Group so successful.

TV EUROPE:What factors have contributed toPoland’s being a vibrant media market?TELLENBACH: To put it in a bigger perspec-tive, Central Europe has very dynamic mediamarkets. The ten-year period before the financialcrisis was fueled by privatization and economicgrowth. Poland, in particular, was experiencingthe same pattern. However, it did not suffer fromthe financial crisis as badly as the other CentralEuropean markets, and, in fact, is the only countryin the E.U. that has not had a recession. It’s quiteremarkable. And although we saw the advertisingmarket contract, the recovery was very steep andlast year we got back on a growth path.Looking at why Poland is in such a unique

position—well, the economic strength helps, butit’s also a highly competitive market, a highlyinnovative market, and Poles are, in general, TVlovers. They also embrace technology and inno-vation and are ready to buy the latest equip-ment. So Poland is a fantastic environment for the

media business in general, and on the pay-TV side, it is one ofthe most competitive markets, with three satellite platforms, fullymature cable operations, and DTT and IPTV taking off.

TV EUROPE: On the free-TV side, how has TVN found abalance between original productions, successful formats andimports, particularly from the U.S.?TELLENBACH: TVN is a slightly female-skewing [family]station with a strong news component. That is a bit unusualpositioning in this part of Europe, but a very successful one.Three-quarters of the schedule consists of locally producedcontent and the remainder is acquired licensed product. Topfeature films from the U.S. are of interest in Poland. CertainTV series, of course, are [also of interest], but generally, the

By Anna Carugati

MarkusTellenbach


TVN Group’s

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thirst for American programs has decreased over the last fewyears with the building out of more professional productionfacilities and Polish viewers’ taste for local content. As we havesuch a high local production percentage on the main channel,we are very much in control of our schedules, which means wehave typical TV seasons, spring and fall, in which we launch, asother markets do, our locally produced shows in prime time.We do run features later in the evening, usually after 10 p.m. It’sa local-production-driven market but still it will continue tolicense a significant amount of U.S. product.

TV EUROPE: As the Polish market is one of the most maturemarkets in CEE, on the free-TV side, do you still see roomto grow your audience share and your advertising share, or atthis point are you just consolidating the position you have?TELLENBACH: We have more than 150 Polish-languagechannels in this country—so it’s quite a competitive landscape.The TVN Group as early as 2001 started to launch alongside itsmain TVN channel a bouquet of thematic channels. Today weoperate eight thematic channels that counterbalance the effectof fragmentation.

Currently, we have about 23 percent of the peak-timeaudience share in Poland and about 32 percent of the televi-sion advertising market, so we are a world-class companywhen it comes to power ratio [the measurement of a mediacompany’s revenue performance in comparison with its audi-

ence share], which is about 1.5. So in the next couple of yearswe believe we are going to see growth in the advertising mar-ket, mainly as a function of growth in GDP. Forecasts call fora 4-percent growth in GDP in 2011 and as a rule of thumb,for a country like this, I would say the advertising marketwill do about double that. So it’s not yet double-digit, but a 6-to 8-percent ad-market growth for electronic media shouldgive us continued momentum to improve and see audiencegrowth on the thematic channels. Out of our 23-percentaudience share, about 19 percent comes from the main chan-nel and 4 percent comes from the thematic channels, which iswhere I see substantial audience growth possible.

TV EUROPE: What factors have been driving your pay-TVbusiness? The N platform is doing quite well, isn’t it?TELLENBACH: The N platform is nothing short of a roar-ing success. We started only four years ago and today we havemore than 800,000 post-pay subscribers [customers who,upon signing a contract for a given package, pay a monthly fee]and about 300,000 customers with prepaid cards [similar tomobile phone prepaid cards]. So together we already have 1.1million customers. We are forecasting that the post-paid sidewill grow from 800,000 to 900,000 subs, while the ARPU isincreasing. The reason is that the Polish consumer is very tech-savvy. We have embraced that particular characteristic and sofar we are the second-largest high-definition platform in

Keeping current: TheTVN Group has a strongnews component, withnews on its flagshipTVN channel as well asa 24-hour newsnetwork, TVN24.

15TV EUROPE


Europe, only behind Sky U.K. We offer not only the largestnumber of full HD channels today (27 full HD channels), butmore importantly, all our 800,000 post-paid subscribers are fullyequipped to receive full high definition already. Four years ago, high definition was not yet a clear win-

ning proposition. We then made a brave move with initiallyquite expensive boxes to deliver the best technology andmore channel offerings, and Polish customers [embracedthem]. Our first effort involved innovation and technologyleadership. We have expanded that position with variousmeasures. Recently we were the first to launch a 3D channeland PVRs. Our customers have PVRs with 500 gigabytehard disks—it’s the latest convenience you can offer on satel-lite—and a full-blown VOD offering. So generally the threeplatforms compete, but they have a different attitude when itcomes to technology, and we have clearly taken the lead.

TV EUROPE: How have the prepaid cards helped drivesubscriptions?TELLENBACH: I’ll be honest, initially it was a test; we werenot absolutely sure it would fly. But the first differentiation isthe price: post-paid customers have the obligation of the con-tract, and packages start in Poland at around 50 zloty(€12.70). Our average ARPU is around 60 zloty (€15.20). Sowe started with a low price offer on prepaid, which is basi-cally a card that you can top up over the phone or over theInternet, or at almost any retail shop or fuel station in thecountry. So it’s extremely convenient. People take the cardto their holiday homes and use them as a second or thirddecoder, for example for the kids. It’s a convenient proposi-tion, even with less features—it doesn’t have a PVR or VOD,but it’s a good offering. We have extended this prepaid offer-ing to high definition, where in Poland you can buy a cardthat is 20 zloty (€5.10) and receive 12 HD channels. This isa popular proposition that is relatively inexpensive becausethose boxes don’t need hard disks. Prepaid has been wellreceived. The consumer feels in control of his expenditure, hespends the money when he wants to use it. Altogether wehave close to 300,000 active customers with little marketing,which is a convincing response from the consumer side.

TV EUROPE: Do you plan to launch more channels for N? TELLENBACH: On the expansion front, we have two focuses.One clearly is expanding and embracing the technology side

and launching or converting more channelsinto high definition. On the pay-TV side,movies are hugely popular, and to thatextent we are strengthening our movieofferings at a good pace in order to havethe best of the best.

TV EUROPE: Are online and new mediaalso growing parts of your business?TELLENBACH: Yes. We are not in searchand social, but we are the number oneportal in this market with 13.5 millionusers, and we’re the number two domainin this country with about 73-percentreach. The interesting bit on the onlineside is the dynamic growth from theadvertising perspective. The last ten years

there were few dollars in online, but we are already seeingdisplay advertising increasing massively. We forecast that in2011, display advertising in Poland will increase and willcontinue to do so for the next couple of years. So webelieve the online advertising market is going to see strongand continuous growth, primarily as a shift from offline toonline budgets. Onet—that’s the name of our portal—enjoys this leadership position to a certain extent becauseit’s part of a media group. Onet is leading when it comesto news, sports and business news, so all the verticals of theOnet domain have a very strong market position and with


TV EUROPE16

A fresh beat: TVN hasbeen airing a local version ofBBC Worldwide’sDancing with the Stars,Taniec z gwiazdami,since 2005.

Model behavior: A second season of Poland’s version of Top Model is set for TVN’s fall schedule.


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that also a verygood position tocompete for addollars.

TV EUROPE:Are your viewerswatching onlineas well as on lin-ear channels?TELLENBACH:Absolutely. Polesare techno lovers.Hybrid TV sets,also known asconnected TV,are being em -braced by con-

sumers. Sony, Samsung and Panasonic are putting out the latesthybrid sets. The telcos are moving quickly to establish broad-band and new IPTV offerings. There will be web platforms—hopefully our own will succeed. This will become a compet-itive environment where Google and Apple and othercompanies will also make their [imprints].

Convergence is happening at a fast pace on the tech sideand ... the TVN group has entered into a unique and long-term partnership with Telekomunikacja Polska TP. We havejust started to launch bundled services, such as broadband andpay TV or pay TV and mobile. There are many combinationsthat we will put on the market, with the goal of having themost competitive offer on the one hand but, on the otherhand, to also develop devices that are particularly customerfriendly. I think that is a key focus: to provide technologyin customers’ living rooms that is manageable. We areembracing that by jointly launching decoders and solutionswith user interfaces that make the whole in-home experi-ence easy and enjoyable.

So online viewing willbecome more and more anissue as broadband penetra-tion increases, but remem-ber, only about 54 percentof Polish households havebroadband connection. Andbroadband here doesn’tmean much more than twomegabytes. In fact, high-definition streaming todayis not possible, but it willbe tomorrow. So we arefully aware that conver-gence is a challenge for amedia company, and withthis partnership agreementwith TP we made the firststep [towards] the begin-ning of convergence. Hav-ing said that, at the end ofthe day, content remainsking. It’s been said a mil-lion times and is still true.

Regardless of how fancy the devices are, Poles will look forPolish-relevant content. The DNA of our company is to bethe leader in news and produce the best Polish entertainmentcontent. So we are not scared; we look to convergence as anaccelerator for our market position.

TV EUROPE: As you look forward 12 to 24 months, whatare the major opportunities and challenges you see for theTVN group?TELLENBACH: Convergence and fragmentation—thoseare the issues that we have to master, and I believe we arewell prepared to take momentum both on convergence andfragmentation with just one or two frequencies on digitalterrestrial. So we are developing that. We are entering part-nerships with hardware manufactures to stay ahead on theconnected-TV side. More interesting medium term is for usto continue to expand our production capabilities. That is akey both on the free and pay sides, as well as for our onlineportal Onet, where we continue to have the best Polish pro-gramming available. Looking further out, I think the consol-idation in the market will be a challenge. A further boost willcome from the analogue shutdown in 2013, providing uswith digital terrestrial television with national reach.

On the thematic-channel side, we are going to seemobile services coming off special interest channels suchas news. We have the leading news service in this countryand it is gearing up to produce apps for all mobile devices.The iPhone does not yet have much penetration in thismarket, but smartphones in general will grow very fast.On the mobile-content side we want to get a solid slice ofthat pie.

There are plenty of challenges ahead, as for any mediacompany, but at the end of the day, we are a content house; thatis where our DNA is. We look at the future with a platform-agnostic approach ... to make sure our programs and brands tra -vel on all devices and all platforms and reach the Polish user.


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Driving forward:TVN24 uses outsidesatellite broadcastingvans to provide thelatest breaking news.

Keeping in control: The TVN Group operates a handful of channels, including TVN Meteo, Poland’s firstdedicated weather channel; TVN Turbo, geared toward males; and the female-skewing TVN Style.


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Until the fall of the Berlin Wall and the end of communism, view-ers in Central and Eastern Europe had a very meager diet ofbroadcast news and entertainment. Each country in the region, infact, only had state-run television. All that changed thanks toRonald Lauder, who in 1994 founded Central European MediaEnterprises (CME). Lauder, who had a vision for providing view-ers with independent news coverage and high-quality programming,started setting up commercial TV stations whose advertisingbusinesses helped stimulate local economies and offered infor-mation and entertainment never seen before in the region.Today, CME is a vertically integrated company with three main

divisions: Broadcasting, MediaPro Entertainment and NewMedia. Broadcasting has 23 channels reaching an audience of50 million consumers across six Eastern European markets, withan estimated combined television advertising spend of over $1 billionin 2010. MediaPro Entertainment, which CME acquired in 2009,is one of the leading producers and distributors in CEE. In fact,in 2010, MediaPro delivered 2,771 hours of content to CMEbroadcasters and licensed 2,058 hours of content internationally.New Media operates more than 60 TV and video-related websites,which attract more than 2 million unique users every month.CME’s net revenues in 2010 were $737.1 million.Adrian Sarbu, CME’s president and CEO, has spearheaded the

company’s three-pronged strategy: producing and broadcastinghigh-quality local programming and independent news; buildinggroups of channels in each key market (five channels in Bulgaria,four in the Czech Republic, three in Croatia, seven in Romania,four in the Slovak Republic and three in Slovenia); and sharingknowledge and skills between its locally managed teams.This strategy has paid off. CME has market-leading channels in

each country it operates in. Time Warner has recognized the merits ofCME’s positioning for the future, so much so that the U.S. mediagiant acquired a 31-percent stake in CME in 2009, and increased itto 34.4 percent earlier this year.Sarbu talks to TV Europe about the successes of each of

CME’s divisions.

TV EUROPE: Tell us about Doma TV, the channel yourecently launched in Croatia. Are you looking to launch morechannels in other countries?SARBU: Doma, which means “at home,” is a concept wedeveloped in Romania 12 years ago, [at this time it was]named Acasa. Why? Because we thought, and we still think,that women are our most important target group, not only forus, but for the advertisers present in the region. We need tooffer quite a large range of programs to women of differentages. For the last 12 years we have been expanding this chan-nel concept, first into Slovakia, then in Croatia, and we haveit on the shelf for all our other markets. Today competitors tryto copy us. But Doma/Acasa is not the only format we haveprepared for the coming years. As recovery progresses in ourmarkets, new projects will start to air.

TV EUROPE: What are the advantages of having severalchannels in the same country?SARBU: Today we have more than 20 channels in six coun-tries. The multichannel strategy is a normal evolution of tele -vision. You experienced it in America in the ’80s and ’90s.The development of distribution platforms—cable, satellite,IPTV and others—requires a more diverse offer from anybroadcaster who wants to maintain audience share. So, in effect,we are looking to maintain our share by diversifying our portfo-lio of channels. We are aware that if we do not do this, our com-petitors will eat away at our audience. However, from now onwe are looking to diversify our revenues and increase the sub-scription fees, which we get from the cable or satellite operators.

The multichannel strategy was a choice and also a mustfor us ten years ago. We understood the need, we understoodthe expectations of the audience, we understood the way weshould evolve our operation. And the result is that we areleaders in audience.

By Anna Carugati


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Central EuropeanMedia Enterprises’

Adrian Sarbu

Newsworthy content: CME’s TV Nova is the largest commercialstation in the Czech Republic, with news as a top offering.

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TV EUROPE:The overall GDP in the CEE region is expectedto reach about 3.2 percent this year. That’s two percentagepoints higher than GDP in the Euro Zone. What impact willthis have on the television industry and on advertising? SARBU: Analysts and investors have been expecting thisrecovery for more than a year. We see our markets graduallypulling out of the economic crisis. GDP is an important indi-cator. In a normal economy, an increase in GDP would trig-ger a trickle-down increase in the advertising market. Butfor the first months of this year, and probably for the wholeyear, we’ll still have to wait and see what the impact of thisexpected rise in GDP will have on consumer spending andTV ad spend.

We enjoy a position that we’ve built up over the years,which gives us a very high operating leverage. Our marketshare in all our countries varies between 41 percent to over70 percent. Our audience is stable and strong, so from everydollar spent more than 50 cents will come straight to our bot-tom line. We expect all of our markets to recover this year.

TV EUROPE: MediaPro is the leading studio in the region.How important is it at this point to develop an internationaldistribution business?SARBU: It’s very important, because we have quite a richslate. MediaPro produces more than 1,000 hours of contenta year for our broadcasters as well as for our home-video andtheatrical-distribution arms. So having an international salesdepartment is a normal evolution for MediaPro. Today we sellour products in more than 15 countries.

TV EUROPE:What does MediaPro have to offer studios andproducers in the West?

SARBU: First of all, MediaPro can be a co-producer ofmovies, TV series and romantic drama novelas, which sell verywell worldwide. Secondly, it offers production services forlarge American and international projects which are set andshot in CEE, and thirdly, it offers its services in cofinancinginternational productions as well distributing internationalproducts throughout CEE, which is its area of expertise.

TV EUROPE: What benefits has CME derived from theTime Warner investment?SARBU: To have a strategic investor like Time Warner is thedream of many media companies in the world. Time Warner is astrong content company.We are a strong content company in ourregion, and there are a lot of affinities with respect to the way wesee the development of our businesses. We think we can shareexpertise and resources. We are a buyer of Time Warner content,not only for television, but also for theatrical and home-video dis-tribution. We also have several projects in development withWarner Bros. A lot of investors ask me what the benefits are ofTime Warner’s investment. The first benefit of having Time War -ner as a shareholder is the fact that it’s Time Warner. The secondis the way we can structure CME in the future and harmonizewith Time Warner’s strategy for content, which is similar to ours.

TV EUROPE: What are your plans for digital? And at thispoint what type of content do you provide online?SARBU: As you know, in the last ten years, there isn’t a sin-gle digital strategy coming from a television company or evena large media operation that has proved to be the right one orthe only one.

Here at CME we are more in line with the philosophy thatwas expressed by Time Warner: TV Everywhere. We see theInternet as a new distribution territory. We see our productbeing used by various groups of consumers on all possibledistribution platforms and devices, and we are working onproviding as much of our content as possible. In the first stageof our digital development, our brands were available on theInternet and we had a very strong presence in our markets. Sobasically we moved to the Internet first with a news portaland various types of sites, which were financed by advertising.

In the fourth quarter of 2010, we launched Voyo in theCzech Republic, which has similar characteristics to boththe BBC’s iPlayer and Hulu. Voyo will offer our channelsonline and will also be a platform for video on demand andcatch-up TV. We will aim to be the same leading provider ofcontent through the Internet in our markets as we arethrough our television stations.

TV EUROPE: Are advertisers responding well to growthopportunities on digital?SARBU: Generally advertisers and ad agencies are movingquite fast in expanding their presence in new media. In ourmarkets, advertisers are choosing the Internet mostly at theexpense of print media while the share of television adver-tising is still growing. So advertisers are willing to get a com-plimentary Internet advertising offer from us on the top ofwhat we give them through television.

TV EUROPE: Are you optimistic about the future of CME?SARBU: I was always optimistic, but now I am more opti-mistic than at any point over the last two years.


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Embraced by all: The popular Romaniantelenovela In the Nameof Honour fromMediaPro Entertainmenthas been bought bychannels inLatin America.

TV EUROPE

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