Local production has been booming in Brazil’s pay TV sector ever since quotas were introduced, but how are producers approaching the telenovela-laden free-to-air sector? Richard Middleton reports.

Brazil’s television industry has been booming in recent years, with unprecedented growth across not just pay TV but also free-to-air (FTA) networks.

Advertising spending in FTA TV amounted to nearly US$28bn in 2013 and pay TV ticked up nicely to US$4bn, according to analyst Ibope. While those figures might impress, it’s the rate of growth that has really drawn attention, with spending on FTA up 16% and an 8% rise in pay.

You would imagine Brazilian producers rubbing their hands with glee, eagerly eyeing up a proportion of that increasing income to create their latest shows. But while prodcos have enjoyed the benefits of local programming quotas in pay TV, FTA nets have faced no such changes.

The “King Midas” of Brazilian TV, as one production executive put it, is TV Globo, dominated by telenovelas and with 90% of its shows produced in-house, local producers face a battle to get the sort of exposure its FTA channel offers. Producers in Brazil and abroad are well versed in its genre-spanning output – and are equally aware of the high-quality content that emerges daily from its vast production facility on the outskirts of Rio de Janeiro.

The issue, of course, is that as long as such a major network chooses to focus much of its efforts in-house, those outside are left to fend for themselves. “Globo is continuing on its path. Even if it buys formats like Big Brother it makes them itself,” says Andrea Olcese, chief creative officer at MediaLeisure and CEO of Einstein Group.

He believes Globo should be seen as the equivalent of a major US network and adds that because it has just one ‘open’ channel, competition among local producers is intense. “It’s not like the BBC or Mediaset, where there are many channels. The spaces at Globo are very limited for external shows,” Olcese explains.

Globo argues that it has spent the past decade working hard to support the Brazilian industry, partnering with independents as a coproducer. One of its latest shows, scripted miniseries Felizes Para Sempre, was produced alongside O2 Filmes and the broadcaster admits that while its FTA schedule is “finite,” it is seeking to offer further opportunities through its online, movie and pay offerings.

Intriguingly, it’s the pay TV industry that now seems to be driving further changes on the FTA front. With the pay sector now required by law to fulfil quotas for local productions, FTA broadcast executives are beginning to see what independents can do and are taking note.

“FTA broadcasters are still doing shows in-house, or buying from other countries, but they are certainly looking at pay TV and at what other producers are doing,” says Rachel do Valle, executive manager at local TV producers’ trade body ABPITV.

“Some pay TV shows have created a buzz and, of course, the FTA execs are listening to that. They’re certainly not closing their eyes and thinking they’re doing everything on their own, so it’s fine. They are looking for new talent and stars, and even though it’s modest compared with what’s happening on pay TV, it happens.”

This subtle but important shift has also been noted by Rodrigo Gava, CEO at Gava Productions. Gava, who is behind animated series such as Nautilus and What’s Up With Mr Turkey?, and is also producing a number of pilots for pubcaster TV Brasil, agrees that using pay TV as a billboard for the independent sector is piquing FTA interest. “They’re figuring out that independent producers can do a lot, and that sometimes they can do it better than in-house, because of the results they see on pay TV,” he says.

Most producers admit that Globo is increasingly warming to the idea of more local independent productions, but there are other FTA broadcasters such as TV Brasil and TV Record that have already embraced the idea.

The latter is currently working with Rio-based producer Visom Digital on drama miniseries Guardian Council (Conselho Tutelar), which has been extended for a second run. Such shows are cementing relationships and helping to introduce new ideas and talent across genres.

“With the growth of pay TV channels – and the independent content on those networks – we are getting a lot of possibilities from Brazilian producers to fill some of the spaces available on free TV,” says Marco Altberg, president of ABPITV.

However, there remain obstacles for the local independent scene, despite the impact pay TV regulations have had. Producers themselves admit that competing with giants such as Globo – which can pump out regular glossy and popular programming – means competition is tough.

“With the new regulations, the Brazilian market is feeling the absence of experienced professionals,” says Ralf Cabral Tambke, director at Rio’s Plural Filmes. “The big issue is how to quickly create writers, directors, gaffers and make-up artists. Since Globo has kept all its talent and know-how for itself, the independent production market is like a black hole, even for the channels, because they also have to learn how to deal with independent production companies.”

Plural Filmes has already enjoyed success in the FTA market, producing a 13-episode documentary series about folk musicians called Visceral Brazil, which aired on TV Brasil. And Tambke expects FTA interest, particularly from the largest players, to continue growing.

“Either FTA channels start opening their minds or they will suffer as their talent turns to the independent market,” he says. “If the sector grows, FTA broadcasters will start coproducing or hiring independent producers. Some small or regional broadcasters have already noticed this.”

Fernando Dias, director at Emmy-nominated Grifa Filmes, agrees. He points out that it can, in some cases, be more cost-effective to produce externally and adds that Globo “understands” independent producers can increase diversity and introduce new talent. And it’s a point on which Globo itself agrees.

“Our main goals in such partnerships are the constant search for content innovation and diversification, besides broadening the relationship with artistic talent,” says a Globo spokesman. “We are always in search of good ideas that may come from the audiovisual market, besides our own talent. It is important for us to be open to that.”

While the drift of talent may force some FTA networks’ hands, two other factors are also set to accelerate the current changes. The creation of financial support mechanisms such as the Fundo Sectorial de Audiovisual – offering US$350m in 2013/14 – and similarly generous regional offerings including the Rio Filme fund are designed to support local productions and have created subsidies available to suitable projects.

These are accessible to local producers but not directly to the FTA channels, making the option of using a third-party production outfit increasingly attractive. The cherry on the cake for producers is that the schemes tend to ensure they retain the rights – an important factor given the similar protection that producers working in the pay TV sector receive. It might reduce the model’s attraction to channels but, equally, it makes international coproduction more likely.

Yet this latter avenue is rarely explored, says Do Valle, as the “time and patience” required is often at odds with broadcasters’ plans. But there are signs this is also changing, she adds, with firms such as Visom attending this year’s Rio Content Market with potential coproductions. Grifa Filmes, meanwhile, has been working with outfits in Canada and Europe for several years and Dias says such arrangements – using funding pots in Brazil but also elsewhere – can help to make up for budget shortfalls.

Dias is currently developing New Species, a 1×90’/2×43’ series about scientists exploring the Amazon Rainforest, with coproduction partners including Gebrueder Beetz Filmproduktion in Germany, Welsh prodco Cwmni Da and Brazil’s Globo Filmes, and distribution by Elo Company. Globo has recently coproduced comedy series Sweet Mother with Casa de Cinema do Porto Alegre, and the show is now being seen around the world as part of Globo Internacional’s sales catalogue, highlighting the importance of its global reach and golden touch for local producers seeking international sales.

Such partnerships could be the future for the country’s local production industry, along with international copros, but gathering global partners together remains a tricky business. In the meantime, the shows that FTA execs are watching on Brazilian pay TV seem to be creating the real opportunities for local producers.