Market Insight

Telefónica builds TV and cinema production with creation of new studio

September 30, 2013

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Telefónica, Spain's leading telecoms and pay TV provider, will launch Telefónica Studios, pushing its national and co-production output to new levels for both cinema and TV. The Studios, announced at San Sebastian Film Festival, will see Telefónica's production entities Telefé, Telefónica Producciones Media Networks and Telefónica España consolidated and strengthened in output. The new entity will produce 25 films in two years, as well as an increased number of TV series.

The Studios will produce and co-produce extensively in Argentina, a territory in which Telefónica has a major television and telecoms footprint. There is also the possibility for further co-productions with other Latin American countries such as Brazil and Peru. New and returning TV shows already announced are Amar en Tiempos Revueltos and Isabel. Cinema productions already announced include Tadeo Jones 2, a follow-up to the animation release which topped the 2012 box office in Spain.

This year, Telefónica made 13 feature-length movies and two major TV series. That number will be at least matched and possibly bettered because of the new studio's two-year commitment - a welcome guarantee of investment in markets bearing the brunt of the recession. IHS Electronics and Media data shows that 163 Spanish productions and co-productions were made in 2012, down from 180 in 2011. Original programming spend in television fell to €1.11bn in 2012, from €1.23bn the previous year. FAPAE, the Spanish audiovisual producers' association, spoke at San Sebastian to appeal for better state audiovisual funding in the face of production, employment and revenue declines.

The leading example of telcos investing in content is that of France Telecom. Studio 37 (now Orange Studio) was created in 2007, with a similarly large upfront commitment to produce 10-15 projects annually, with expenditure of €15m over three years. The TV series made for Movistar - Telefónica's pay TV provider and consumer telecoms brand - promise to be, in the words of Telefónica's announcement, 'premium quality', with high international sales potential boosted by Telefónica's distribution channels in Latin America. Looking at France Telecom/Orange and its achievements - Orange Studio is still running after five years, and 2012's The Artist cleaned up at awards both nationally and internationally - Telefónica will be hoping for a similar success story.

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