Broadcast Television in Latin America
Television signals are electromagnetic waves that are sent from a transmitter to one or more television receivers. Since television sets are produced at factories by different manufacturers in order to receive signals coming from different broadcasters, there has to be a television standard. All electromagnetic waves travel at the speed of light, but they can have different wavelengths and frequencies. Television signals have been assigned by international accord to certain ranges of the electromagnetic frequency spectrum.
First of all, there is the VHF (Very High Frequency) band of frequencies. There are twelve VHF channels, which are numbered 2 through 13 respectively, and they occupy the frequency range between 54 MHz and 216 MHz (where MHz means mega-Hertz or millions of cycles per second). Each channel is 6 MHz wide, with 4 MHz used for transmission of video images and 2 MHz for audio and other data.
With the exception of Channels 4 and 5, and Channels 6 and 7, the VHF channels are adjacent to each other. Adjacent channels interfere with each other through signal leakage, and so adjacent channels are not assigned in the same city. This means that the maximum number of VHF stations is seven in any city. At the same transmission power, a lower numbered channel can reach a larger area than a higher numbered channel.
To increase the number of television stations in a market, the UHF (Ultra High Frequency) band was introduced. There are 56 UHF channels, which are numbered 14 through 70, in the range of 470 to 806 MHz. The channels are 6 MHz wide with no unused gaps in between. Due to interference, adjacent channels are not assigned in the same city. In theory, there can be as many as 28 UHF television channels per market. In practice, there are seldom more than three or four UHF stations in even the largest cities. At the same transmission power, the high-frequency UHF stations reach a much smaller area than the low-frequency VHF and they are therefore less economical to operate.
The above description provides the theoretical capacity for the number of broadcast television channels that can be received. In practice, there are some constraints. For example, Buenos Aires, Argentina is situated across the river from Montevideo, Uruguay. Frequencies in one city will interfere with those of the other. This explains why the allocations are channels 2, 7, 9, 11 and 13 in Buenos Aires and channels 4, 5, 8 and 10 in Montevideo to minimize interference.
In the graph below, we show the actual number of national broadcast television channels received by Latin Americans, according to the Los Medios y Mercados de Latinoamérica 1998 study.
The average number of national broadcast television channels that can be received by Latin American households is 5.29 channels.
Perhaps the more important issue is not so much the number of channels that can be received, but the actual number of channels that are being regularly watched. In the following graph, we show the actual number of national broadcast television channels watched by Latin Americans during the week.
In a typical week, the average person between the age of 12 and 64 inclusive watches 3.36 national broadcast television channels. This means that Latin Americans will watch only 100 x 3.36 / 5.29 = 64% of what they can receive. The following table show the cross-tabulation between the number of channels that can be received and viewed in the last 7 days (each row adds up to 100%, within rounding).
Number of Channels Viewed Last 7 Days
Received Zero One Two Three Four Five Six Seven Eight Nine
One 10% 90%
Two 1% 27% 72%
Three 4% 18% 30% 48%
Four 2% 9% 22% 28% 38%
Five 2% 8% 17% 21% 26% 26%
Six 1% 6% 14% 23% 16% 17% 23%
Seven 1% 4% 16% 18% 21% 13% 14% 14%
Eight 0% 5% 10% 17% 16% 19% 13% 11% 10%
Nine 2% 3% 8% 24% 15% 11% 16% 6% 10% 4%
Total 7% 9% 17% 22% 18% 13% 8% 4% 2% 0%
The fact of the matter is that not all television channels are equal. These differences arise due to a number of factors ---
Due to a set of path-dependent historical developments, some stations with long histories have developed viewer loyalty and dominance whereas the newly licensed stations have yet to develop brand identities
When there are many broadcast television channels in a market, it may be necessary to have product differentiation. The typical broadcast television channel offers a programming schedule of telenovela reruns in the middle of the day, cartoons in the early afternoon, first-run telenovelas in the early evening, news in the late evening, cartoons on weekend mornings and sports on weekend afternoons. But when there are nine broadcast television channels in a market, it makes no sense for all of them to run the same types of schedule, because counterprogramming is more productive and profitable, especially for the lesser players. Sometimes, this works as just juggling around programs. Other times, the entire channel is positioned as a niche product (e.g. Rock y Pop in Santiago, Chile; Puma TV in Caracas, Venezuela; TV Cultura and TV Educativa in Brazil; Canal 11 and Canal 22 in Mexico City, Mexico).
Signals come at different strengths, wherein we have noted that the quality of the signals depends on the positioning in the spectrum. Obviously, viewers prefer to have clear pictures.
There are differences in the sizes, positions and shapes of the coverage areas, wherein the reach of national broadcast channels depend on the number of retransmitters, satellite coverage and cable carriage.
The television channels are in different financial conditions, wherein television channels with good financial backing can afford to invest in production, distribution, promotion and sales, and to reap the benefits.
The competitive environment is a function of both the size of the market as well as the current macroeconomic conditions. To put it simply, a small market may be able to profitably support a couple of television channels. The smaller television channels will probably be caught in a path-dependent downward spiral --- small audiences mean less revenues, which mean poorer programming either produced by themselves or purchased from the outside, which mean even smaller audiences.
Whilst it is desirable to offer consumers more viewing choices, the matter is not simply one of opening up the television spectrum to more competitors. It is also necessary to create suitable environmental conditions to permit the television channels to survive and flourish. Now that is a much more difficult proposition.
Reference: Competition in the Broadcast Television Marketplace in Latin America Research paper published on Zona Latina (8/17/98)